Capital’s prime workplaces see sharp increase in demand while rest of UK office markets lose ground
Investment in Central London office buildings has risen sharply over the past year, even as spending on offices elsewhere in the UK has fallen, according to new figures from estate agency and property development company BPS London.
The firm’s analysis of commercial property transactions shows that capital committed to Central London offices increased by 45.1% year on year, from £4.79 billion to £6.95 billion. Over the same period, investment in offices across the rest of the UK declined by 28.5%.
Across the UK office sector as a whole, total investment grew by 18.8%, from £7.46 billion in 2024 to £8.86 billion in 2025. This left offices ahead of industrial property, where investment volumes rose by 16.6%. Retail and leisure assets saw investment fall by 25.1%, while the living and mixed‑use segment recorded the strongest expansion, up 32.1%.
BPS London said the divergence between London and other office markets reflects the stronger return to in‑person working in the capital. Office attendance in Central London has, it said, recovered more firmly and more consistently than in other UK cities, underlining investor confidence in longer‑term occupational demand.
Despite the increase in money deployed, the number of office deals has fallen. Transaction volumes across the office sector were down 6.9% over the year, indicating that investors are concentrating on a smaller pool of assets. Activity has been focused on buildings seen as capable of meeting modern occupier requirements, rather than older or secondary stock requiring substantial repositioning.
“The office sector has been one of the standout performers over the last year, but what’s particularly notable is that this recovery is being driven almost entirely by Central London,” noted Mahir Vachani (pictured right), director at BPS London Developments.
“What we’re seeing is a clear link between the return to the workplace and renewed investor confidence in the capital, with London leading the recovery in physical office attendance, which has given investors greater confidence in the long-term fundamentals of its commercial property market.
“At the same time, investors are becoming far more selective. There is a growing focus on acquiring and upgrading buildings that can genuinely meet the expectations of today’s workforce, rather than simply acquiring space for the sake of it.”
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