According to Ablestoke’s October 2025 review, investment activity in the UK real estate market increased notably during the second and third quarters of the year. The Q2 volume of commercial real estate transactions was the second-highest in the past 13 quarters, while Q3 saw strong momentum in the hospitality sector, with total transactions reaching £1.04 billion, up 28 % year-on-year. Of this amount, £697 million was invested in London, representing a 42 % annual increase. 

The publication reports that international investors accounted for 45.9 % of all transactions in Scotland during the first nine months of 2025. The majority of this capital originated from Europe, North America, and the Middle East. The average transaction value for commercial assets in central Edinburgh and Glasgow rose 6 % compared to Q1 2025. 

In the office segment, activity remains limited. Vacancy rates stand at 9.8 % in London and 11.2 % across regional cities. Office development remains subdued, with less than 1.3 million m² under construction — only 2.1 % of existing stock. 

The industrial property sector continues to strengthen. Prime rents on new leases rose 3.4 % quarter-on-quarter, and investment volume reached £2.7 billion, up 9 % compared with the five-year average. 

In the retail sector, transactions for retail parks and high street assets totaled £1.9 billion, while average vacancy declined to 6.1 %. The uptick in activity reflects redevelopment efforts and a reduction in obsolete stock. 

The report also highlights growth in “alternative” sectors. Investments in care homes and life sciences campuses increased 12 % over the first nine months of 2025. Meanwhile, data centre transactions reached £850 million, marking an 18 % year-on-year increase. 

Ablestoke forecasts a moderate rise in investment activity in Q4 2025, led by the industrial and hospitality segments. The total annual investment volume in the UK commercial property market is projected to reach around £50 billion. 

Commentary from M24 Investment Division: 

The Ablestoke data confirm the ongoing recovery of the UK real estate market. The £1.04 billion increase in hotel transactions and continued strength in the industrial sector highlight a shift of capital toward resilient, demand-driven asset classes. Limited new office construction and falling retail vacancies provide a basis for market stabilization heading into 2026.