A rebound in UK's commercial property – should you invest?

UK commercial property's three-year bear market finally appears to be over, says Max King

Commercial property in the City of London
(Image credit: Getty Images)

It has been a long winter for the UK’s commercial property sector, but at last it seems spring is in the air. Savills reports that the vacancy rate in the City and West End of London office property market has fallen from a peak of 9.5% in late 2023 to 7.4%, although it is still comfortably above the long-term average of 5.9%.

The rate of growth in online shopping has slowed to the mid-30s in percentage terms, including food, and shopping centres have learned to adapt. Customers see them as a destination. They want to browse in shops, visit cafes and restaurants, and go bowling. Retailers have learned that returns from online shoppers are expensive to handle, so shops are now not just sales outlets, but also showrooms for buying online.

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Max King
Investment Writer

Max has an Economics degree from the University of Cambridge and is a chartered accountant. He worked at Investec Asset Management for 12 years, managing multi-asset funds investing in internally and externally managed funds, including investment trusts. This included a fund of investment trusts which grew to £120m+. Max has managed ten investment trusts (winning many awards) and sat on the boards of three trusts – two directorships are still active.

After 39 years in financial services, including 30 as a professional fund manager, Max took semi-retirement in 2017. Max has been a MoneyWeek columnist since 2016 writing about investment funds and more generally on markets online, plus occasional opinion pieces. He also writes for the Investment Trust Handbook each year and has contributed to The Daily Telegraph and other publications. See here for details of current investments held by Max.