Emerging sectors in the UK commercial property sector

Where to invest next? With the UK Commercial Property Market suggesting growth into the next financial year, and rumours of stagnation within the residential property market, could commercial property be the next investment you are looking for?

Business Connect Magazine chatted to Reece Suter, Associate Director at PM Property Lawyers, who are a national firm of lawyers offering a comprehensive range of legal services across all regions of the UK. One of their specialist areas is commercial property, and under the established brand of Wilsons Solicitors (based in the Leeds area), Reece has looked at a selection of opportunities very much in line with the analysis from our regular columnist Nick Thorpe. We asked Reece to go into more detail and to further explore these areas of growth, outlining specific sectors that could be part of an expanding commercial property portfolio:

Logistics and warehousing
“Demand for logistics warehousing has grown exponentially with the rise of eCommerce in the UK. As a result, major retailers have acquired large fulfilment centres or have taken space within larger shared fulfilment centres. Meeting customer demand for overnight deliveries has taken priority in business growth strategy, and this means that spaces along the M1 and M6 corridors are highly sought after. But with more than nine pages of Google results for “Warehouse to let M1 Corridor,” is this market already saturated with investors who were early adopters of this movement?”

Data centres and warehouses
“The data economy is growing faster than ever, which means that the demand for spaces to be used as data centres has grown significantly. Businesses are looking for spaces which are secure and have a strong fibre optic network for hosting large quantities of data. These types of spaces could be ideal for your next commercial property investment. It has been suggested that Manchester, London and Birmingham are set to be prime investment hotspots for this type of property.

Medical space and life science
“More than 300,000 people in the UK are already employed within the life sciences industry, and this figure is set to grow further over the next five years, suggesting that the UK is a global leader in biotech and pharmaceuticals. The areas surrounding Oxford, Cambridge and London have become known within the sector as the ‘Golden Triangle’ wherein there is demand for research and lab space. With graduates leaving top universities within these areas every year, biotech firms, medical start-ups and pharmaceutical companies are expected to continue to pop up in the Golden Triangle, seeking high-yield long-term lease agreements.”

Flexible and co-working spaces
“Despite the 2025 return-to-office mandates of some large companies, there is still a lot of UK talent that demands hybrid or remote working as part of their work-life balance, and this has changed the need for office space. Whilst the need for traditional office space appears to be declining, the demand for more flexible and co-working spaces with a range of facilities including coffee shops, gyms and meeting rooms is on the rise. This is particularly prevalent in areas where startups are more common, such as London, Birmingham, Manchester, Bristol and Newcastle.”

Mixed-use developments
“Across the UK, there is a shortage of homes, and whilst the current government are working hard to combat this, it seems that some businesses are favouring mixed-use buildings, which integrate commercial property with residential dwellings. This sector is growing, and it looks like it could be stable, particularly where local authorities support this type of property to aid urbanised growth. For investors, investing in buy-to-let property, and diversifying their existing portfolios into areas that are expected to have high returns, could lead to a long-term success for their business’s growth. And whilst the sectors highlighted in this article are growing, investors should ensure they undertake their due diligence before taking a leap of faith into a new industry.”

Reece and the team from Wilsons are specialists who work hard to stay on top of UK Commercial Property trends. The firm have Commercial Property Lawyers that specialise in all aspects of this sector, from leases to buying and selling commercial property, and the business within it. Reece summed up: “Speak with our team today for all aspects of advice on your commercial property ventures. We will support you through every aspect of your journey.”