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Healys introduction by Jamie Lasaki
As a full-service law firm, the various departments here at Healys work collaboratively. We also have close relationships with other professional advisers supporting business owners and founders. With commercial property being a key element in many of our corporate transactions, teams like those led by Simon Isaacs of Kinney Green are often instrumental in advising clients on what to expect in the market. In this article, Simon explores how business owners can remain resilient while continuing to evolve.
Simon Isaacs, Kinney Green
The London commercial property market is undergoing a substantial recalibration, driven largely by tenants becoming more selective and demanding higher-quality space with better end-of-journey facilities and ESG/EPC-compliant specifications.
A two-tiered market has emerged since the Covid-19 years, with tenants seeking quality stock. The same applies to the investment market, where sentiment remains optimistic, and investors are taking a longer-term view on value-add potential amid short-term uncertainty.
Despite the uncertainty of the past five years—caused by Covid-19, the cost-of-living crisis, and the ongoing battle with inflation—London remains a safe and strong investment choice for both domestic and overseas investors.
The office market is divided between prime, ESG-compliant spaces—commanding record-breaking rents across the City, Midtown, and West End—and older stock, which has stagnated or declined in rental value due to a lack of modern amenities and facilities.
In the industrial and logistics sector, the Greater London market remains strong. Location is key, with accessibility being a major driver of rental growth. Many landlords are now providing more energy-efficient properties that appeal to both domestic and overseas investors.
The retail market continues to struggle, particularly on the High Street. What was once the crown jewel of many investment portfolios is now laden with risk due to tenant defaults, long void periods, and the potential for significant capital expenditure to remedy disrepair. While prime central locations—such as Bond Street, Oxford Street, and Regent Street—retain appeal, prices in peripheral High Streets have declined. However, secondary and tertiary retail parades still attract demand, particularly from smaller investors such as private offices, family trusts, and high-net-worth individuals.
UK PLC: Value-add and strong returns are key
The broader UK property market mirrors trends in Central London. Tenants across the country are more selective about the premises they wish to occupy, reinforcing the emergence of a two-tiered market in cities nationwide.
Tenant expectations around how space is delivered have changed. Whereas pre-Covid-19, tenants would take office space in a Cat-A condition ready for their own fit-out, many landlords are now offering Cat-A+ or Cat-B finishes—enabling tenants to effectively "plug and play" from day one with minimal fit-out time. Hybrid working patterns continue to create uncertainty, with businesses navigating how best to support the work-life balance their employees are seeking. This shift is directly influencing the importance of breakout areas, amenities, and overall office design to attract people back into physical workspaces.
Thanks to Simon Isaacs of Kinney Green for these insights.
To discuss any of the above topics further, please contact:
Kinney Green – s.isaacs@kinneygreen.com | Tel: 020 7643 1500
Healys LLP – Jamie Lasaki | Jamie.Lasaki@healys.com | Tel: 020 7822 4000