The Intermediary – December 2025 - Flipbook - Page 40
SPECIALIST FINANCE
Opinion
As the noise
fades, investors
make plans
Demand to invest in commercial buildings rose 11% on the year
I
was looking over the latest
market updates the other
day, and it reminded me how
oen we get hit with these big
headline figures that make
everything sound dramatic,
but once you look underneath, the real
story is a lot calmer.
You read the numbers, and then
you find yourself thinking, ‘OK,
fine, but what does this actually
mean for people placing money into
property or into their own businesses
right now?’
That is where 2025 feels a bit
different to previous years. Things
are steady at the fringes, the noise has
faded out, and investors are starting to
think properly again about where to
put capital instead of waiting for the
next rate swing to tell them what to do.
No more jolting
What is helping is that rates have
stopped jumping about. Look, they are
still higher than they were two years
38
The Intermediary | December 2025
ago, but the constant shock factor has
long gone. Investors are no longer
making decisions with one eye on a
chart that changes by the hour.
Rightmove Commercial’s ‘Q3 2025
Insights Tracker’ shows commercial
enquiries up 9% on the quarter, with
stronger activity from smaller firms
and quicker movement of available
stock. It points to capital still being put
to work, just with more care than we
have seen for a while.
Sharpened up
The clearest sign of movement is
on the commercial property side.
Rightmove’s Tracker also shows
demand to invest in commercial
buildings rose 11% on the year.
Retail demand rose 30%, offices rose
31%, and industrial – which has been
a reliable performer – rose 53%. Those
are not small changes. They show that
investors want exposure again, but
they are being far more selective about
where it sits.
CONOR MCDERMOTT
is director of SME lending
at LHV Bank
A big part of the story this year is
spending on improvements. Investors
are puing real money into stock that
needs updating. Nearly £1.1bn was
raised through 6,737 remortgages
in the first half of 2025, specifically
for property works, compared with
£712m and 4,632 loans a year earlier.
That is a 54% rise by value.
It tells you investors are certainly
not siing back, but preparing
buildings for new rules, new tenant
expectations and future value.
Regional markets are also taking
more of the spotlight. Investors who
once concentrated on two or three
postcodes are looking outwards again.
With a steadier rate backdrop, the map
widens, so towns in the Midlands, the
North and parts of the South West will
be seeing more enquiries, particularly
where there is a sensible price point
and a path to improving the asset.
Internal investment
decisions
When you look at investment from
the small to medium enterprise (SME)
side, the tone shis slightly but the
principle is the same. Owners are
reconsidering where they place capital
and whether the next 10 years look
different to the last 10.
For me, one of the biggest changes
is the growing number of SMEs
being asked if they want to buy their
premises. It is not something many of
them planned, but once that question
lands, it becomes an investment
discussion rather than a simple
funding one.
This is where the calmer market
helps, and owners can finally compare
