The latest research by BPS London has revealed that just 18.2% of commercial property opportunities currently listed for sale across London have secured a buyer, highlighting a highly selective investment landscape across the capital.
BPS London analysed current commercial property listings across London, assessing the proportion of available opportunities that have already attracted investor interest, alongside how demand varies across each commercial asset class.
The analysis shows that, overall, just 18.2% of commercial property opportunities across London are currently under offer or sold subject to contract, demonstrating that while investor appetite remains present, it is being deployed far more selectively across the market.
However, this level of demand varies considerably by sector. Leisure assets are currently seeing the strongest investor appetite, with 75.0% of available opportunities having secured a buyer, followed by specialist assets at 54.2%. Build-to-rent opportunities have also seen relatively strong demand at 30.0%, while hospitality assets stand at 23.1%.
More traditional commercial sectors are seeing more measured levels of demand. Retail assets, which account for the largest proportion of available stock at 44.5%, have seen 19.7% of opportunities attract investor interest, while industrial assets stand at 16.0%.
In contrast, office space is currently seeing lower levels of investor demand, with just 14.7% of available opportunities under offer, despite accounting for 33.6% of all commercial stock currently listed for sale across the capital.
According to BPS London, this imbalance reflects a shift in how commercial space is being utilised, rather than any fundamental lack of long-term confidence in the office sector itself.
The office sector is a prime example of this shift in preferences as, while demand for physical workspace continues to return, occupier expectations have evolved significantly, with greater emphasis placed on flexibility, design, amenities and overall workplace experience.
As a result, a large proportion of existing office stock no longer aligns with modern requirements, creating a disconnect between supply and investor demand and presenting a clear opportunity for developers capable of repositioning well-located assets.
BPS London recently acted on this opportunity alongside Purestone Capital, completing the acquisition of a core West End office building on Tottenham Court Road in Fitzrovia. The joint venture between the two private investors marks the first acquisition for their value-add investment platform, with plans to transform the building into a best-in-class workspace aligned with modern occupier expectations.
Commenting on the findings, Mahir Vachani, Director at BPS London Developments, said:
“What this data highlights is just how selective the market has become. Investors are no longer taking a broad approach across commercial property, they are targeting specific sectors and assets that align with long-term demand.
At the same time, the office sector is undergoing a period of transition. It’s not a question of whether offices are needed, but whether the existing stock meets the expectations of today’s workforce, which have shifted significantly in recent years.
Our recent acquisition on Tottenham Court Road reflects our belief that there is a clear opportunity to reposition well-located office buildings to deliver the kind of high-quality, experience-led workspace that businesses now require.”
