Rightmove Commercial Property Insights 2026

What does the Q4 2025 Rightmove data show about UK commercial property?

Rightmove's Q4 2025 Commercial Insights Tracker, published January 2026, analysed millions of enquiry and listing data points from the UK's largest commercial property audience. The headline picture is one of resilience. Occupier leasing enquiries remained positive year-on-year in most sectors, and investment enquiry volumes held steady or improved, despite the pause in decision-making that followed the Budget announcement in late November 2025.

The Budget prompted speculation about changes to corporation tax reliefs, capital gains treatment, and business rates multipliers from April 2026. Many occupiers and investors adopted a wait-and-see posture in November and December. This slowed growth compared with the third quarter and the same period in 2024, but it did not reverse the positive trajectory. Demand remained above the same period last year in most sectors, which says something meaningful about the underlying fundamentals.

How is each commercial sector performing?

Industrial: the standout sector. Industrial property, covering logistics, light industrial, urban warehousing, and distribution, led the market in Q4 2025. Leasing enquiries were up roughly 11% year-on-year and investment interest rose approximately 12%, continuing a sustained run of outperformance. The drivers are structural: continued growth in e-commerce, demand for last-mile delivery infrastructure, and sustained SME manufacturing requirements are creating consistent appetite for industrial space.

From a financing perspective, lenders are constructive on well-located modern industrial assets. Commercial mortgages and development finance for schemes in motorway corridors and major conurbations are typically more straightforward to place than other commercial sectors. Rental growth has supported valuations and improved loan serviceability metrics. We are actively seeing this play out in recent light industrial financings in Bristol and the Midlands, where demand from both occupiers and investors continues to track above the national commercial average.

Offices: modest growth, clear quality divide. Office leasing demand grew approximately 2% year-on-year in Q4 2025, and investment demand was up 4%. The headline masks significant divergence. Prime, energy-efficient space with flexible layouts continued to attract demand. Secondary and tertiary offices, particularly older stock with poor EPC ratings, remained harder to let and harder to finance. Prime London locations outside the City and Westminster, including Camden, Hammersmith and Fulham, and Kensington and Chelsea, saw stronger performance and in some cases double-digit leasing demand growth.

For financing, the office quality divide creates opportunity around repositioning. Bridging loans and refurbishment finance can support projects that convert outdated stock into modern workspace or alternative uses such as residential, HMOs, or MUFBs where planning allows. Lenders are increasingly focused on sustainability credentials, and schemes that improve EPC performance often attract more competitive terms than unremediated secondary stock.

Retail: selective headwinds. Retail leasing demand saw a year-on-year decline of around 4% in Q4 2025, continuing structural pressure on certain high street and shopping centre formats. The picture is not uniformly negative. Well-located neighbourhood parades, convenience-led retail, and destination formats continue to attract occupiers and investors. Scotland's retail market saw increased investor demand for the first time since 2015, suggesting potential stabilisation in certain regional markets. Investment demand for retail nationally was up 3%, indicating continued institutional appetite for the right assets.

Lenders maintain a more cautious stance on secondary retail, particularly vacant high street units. Specialist brokers can still secure funding for properties with robust tenant covenants, mixed-use elements, or lettings to essential retail operators. The key is presenting a realistic rental income profile and demonstrating sustainable occupier demand at the proposed rent.

Leisure: patchy. Leisure leasing remained marginal in Q4 2025, with a 1% increase, while leisure investment demand was down approximately 7%. Rising operating costs, including energy and staffing, have created genuine headwinds for certain hospitality formats. Well-run hotels, student-linked leisure near strong university cities, and experiential venues continue to attract funding. These sub-sector nuances feed directly into pricing, leverage, and structure for commercial mortgages and bridging in 2026. Lenders have tightened criteria on leisure properties since 2020 and we continue to see the effects of that in how some lender panels approach the asset class.

What are the regional patterns across the UK?

Beyond sector performance, Rightmove's data reveals diverging regional stories that matter directly for borrowers seeking finance, since lender appetite can vary significantly by location and asset type.

London: two markets in one. Core London office leasing demand, particularly in the City and Westminster, lagged the national trend in Q4 2025. The City of London saw a 24% decline in leasing enquiries, while Westminster recorded an 8% decline. This slowdown reflects occupiers pausing decisions ahead of the Budget and awaiting greater clarity on rates and tax treatment. The fall in demand is concentrated in older stock and large floorplates that require significant capital expenditure to meet modern tenant expectations. Investment demand for London offices overall was strong, with investors positioning for rental growth once the wider economy stabilises further.

Regional markets: stable to improving. Regional markets generally recorded more stable or improving enquiry levels for both industrial and office. The North West, West Midlands, Yorkshire and The Humber, and parts of the South West showed positive momentum. The East Midlands recorded the largest increase in overall investment demand at 43% year-on-year, followed by London at 39% and the East of England at 36%.

Regional strength creates opportunity for investors and owner-occupiers to achieve better yields and more flexible terms compared with central London. Industrial estates, trade counters, and smaller office buildings in strong regional towns and cities often offer attractive fundamentals. Lender risk appetite varies by region and asset type, which reinforces the value of working with a broker that can match a specific postcode and sector to the right lender panel.

What market forces are shaping commercial property finance in 2026?

ESG and asset quality. Lenders are prioritising ESG-compliant, high-quality buildings and applying stricter conditions to older or secondary assets. ESG-compliant properties, those with strong EPC ratings, sustainable construction credentials, or responsible management practices, are increasingly favoured across the lending market. Prime assets in the best locations with strong tenant covenants are expected to benefit from increased lender competition, improving maximum LTV ratios and sharpening margins as banks and alternative lenders become more active.

Green and retrofit finance. Green loans and retrofit finance products are rising to fund decarbonisation and meet tightening energy standards. Green loans are structured specifically to support the acquisition or refurbishment of properties meeting defined environmental criteria, such as high EPC ratings or BREEAM certification. Retrofit loans provide funding to upgrade existing buildings, improve energy performance, and comply with regulatory requirements. These products are available from a small but growing number of specialist lenders and are worth exploring where the works clearly improve the asset's marketability and value.

Refinancing cycles. A significant portion of 2026 market activity is expected to be driven by refinancing existing debt rather than new acquisitions. Many property owners need to manage debt maturities, adapt to evolved lender requirements, and exploit the improved rate environment compared with the peaks of 2023 and 2024. Borrowers who took on fixed-rate facilities at 7% to 9% during that period should model the break-even calculation on refinancing now versus waiting for further base rate cuts.

Interest rate trajectory. The Bank of England reduced the base rate from 5.25% to 3.75% between 2024 and early 2026. Markets expect gradual further easing through 2026. Lower base rates reduce pricing on variable-rate commercial mortgages and make DSCR stress testing more favourable for viable schemes. For development finance, improving rate conditions improve appraisal viability and are beginning to release pent-up demand from developers who paused schemes during the higher-rate period.

What does this mean for commercial mortgage borrowing in 2026?

Relatively stable Q4 2025 demand, combined with a base rate that has fallen from 5.25% to 3.75% and forecasts of further cuts, points to a more supportive backdrop for commercial borrowing than at any point in the last two years.

Owner-occupiers. Trading businesses considering buying their own premises, whether warehouses, clinics, light industrial units, or leisure venues, could benefit from acting as interest rates continue to ease. Long-term commercial mortgages often prove more cost-effective than remaining on escalating leases, particularly for businesses with stable cash flows and long-term operational plans. The own-versus-lease calculation has shifted materially in favour of purchase as commercial rents have risen and mortgage costs have fallen from their 2023 peaks.

Investment property. Investors can use commercial mortgages within limited company structures for multi-let offices, retail parades, HMOs, MUFBs, and student blocks. The Q4 2025 data supports a cautiously optimistic case for medium-term income growth in industrial, selective retail, and quality office assets. The first half of 2026 may see increased transactions as Budget clarity allows previously delayed decisions to proceed. Lenders will still scrutinise tenant quality, lease lengths, EPC ratings, and local demand. Properties with weak covenants, short unexpired lease terms, or poor energy performance will continue to face more difficult terms.

Where are the bridging and development finance opportunities?

Transitional market conditions, steady demand combined with evolving pricing, are well-suited to bridging finance and development funding. The early stages of a rate-cutting cycle historically creates particular opportunities for investors who can move quickly.

Acquisitions with added-value plans. Investors can use bridging loans to purchase under-rented or partially vacant assets, complete refurbishments, improve energy performance, and re-gear leases before refinancing onto a longer-term commercial mortgage. This strategy works particularly well when there is a clear path to enhanced rental income or improved tenant covenant. Speed of completion can be a competitive advantage when sellers are motivated, and bridging provides the capital to close quickly while longer-term funding is arranged.

Office-to-residential conversions. Demand remains strong for finance on permitted development conversions of secondary offices into residential uses, including HMOs, MUFBs, and student accommodation. This is particularly the case in regional centres where Rightmove data shows stable occupier interest. The fall in traditional office demand in some locations creates a supply of buildings suitable for conversion. Lenders supporting these schemes scrutinise planning status, build costs, and realistic GDV assumptions carefully.

Industrial development. Sustained industrial demand and pockets of undersupply in modern logistics space make a strong case for development finance. Lenders favour well-located schemes backed by experienced developers with realistic appraisals. The second half of 2026 may see increased development activity as rate cuts improve scheme viability and release pent-up demand from developers who paused projects during the higher-rate environment.

Practical steps for investors, developers, and trading businesses

The Q4 2025 data and 2026 outlook point to clear actions for different types of borrower.

Action	Detail
Portfolio review	Assess holdings sector by sector against demand trends: industrial positive, retail selective, office quality-dependent
Refinancing review	Review facilities agreed at 2023 to 2024 rates. Model the break-even on refinancing now versus waiting for further cuts
Equity release	Consider releasing capital from stronger assets to redeploy into sectors with better growth prospects
Repositioning	Identify underperforming assets where refurbishment or change of use could improve returns, particularly secondary offices in strong regional towns
Development funding	Secure outline funding terms early for 2026 to 2027 schemes. Stress-test appraisals against slightly lower exit yields but potentially softer finance costs
Owner-occupier calculation	Run the own-versus-lease comparison. Rising rents and falling mortgage costs have shifted the calculation materially since 2023

For developers: industrial and logistics development remains well-supported by lenders, while office and mixed-use schemes require stronger location and tenant demand evidence. The North East, North West, and Midlands offer opportunities where land costs are lower and industrial demand remains robust. Engaging with a commercial finance broker in the early stages of scheme planning helps identify deliverable funding structures before money is spent on design or planning.