In 2025, Leicester was found to be the top UK city for commercial property investment, according to research by the Alan Boswell Group.
The group’s research placed the city first due to low business closure rates and stable retail sales, standing at 100.3% of pre-pandemic levels.
Leicester’s rateable value increased by 3.79% over five years, and crime rates were low with only about six shoplifting incidents per 1,000 businesses.
Bristol took second place, displaying low rates of business closures at 118 per 1,000 businesses and minimal long-term flood risk.
Despite a slightly higher shoplifting rate of nine per 1,000 businesses, these factors contributed to its appeal.
Bristol’s rateable value rose by 2.86% over five years, indicating steady demand.
Derby ranked third with healthy consumer spending reflected in retail sales at 102% of 2019 levels.
The city also had secure property conditions with non-residential burglaries at just one per 1,000 businesses.
Derby had slightly lower empty premises relief compared to Leicester, hinting at better occupancy rates.
Conversely, Cardiff was identified as the most challenging UK city for commercial property investment, scoring just 2.72/10.
The city faced issues such as high flood risks and significant business closures, with 152 per 1,000 businesses.
Declining rateable values by 1.86% over five years further weakened its commercial prospects.
Birmingham followed Cardiff with a score of 2.78/10.
High business closure rates and weak retail sales, which were only 89.5% of 2019 levels, made it difficult for commercial enterprises.
Bradford was also highlighted, scoring 3.34/10, due to high crime rates and struggling commercial conditions.
Business closures were high with 144 per 1,000 businesses, and security was a concern with notable incidents of shoplifting and burglary.
Wendy Burgess from the Alan Boswell Group said: “The UK’s commercial property market is undergoing a complex recovery, with investor interest growing in certain regions, while challenges persist in others.
“The surge in demand seen in Q4 2024 suggests a cautious optimism, yet it’s clear that the outlook varies significantly by location.
“Cities like Leicester and Bristol benefit from strong retail sales and appreciating property values, while cities such as Cardiff and Birmingham face significant hurdles, including high business closures and stagnant property value growth.”
Burgess added: “Cities with higher crime rates may face rising premiums for burglary and theft coverage, while locations at greater risk of flooding, such as Cardiff, will require more specialised flood protection to safeguard assets.
“With fluctuating property values and the potential for higher vacancy rates, property owners must review their insurance policies regularly.
“Engaging proactively with insurers can help mitigate potential risks and ensure that coverage aligns with both market conditions and local hazards.”
