Interest rate cuts are fuelling increased activity across all commercial property in South London and beyond

Posted on 12 August 2025

Investment in retail commercial property is making a comeback as demand rose by 35 percent in the second quarter of 2025 compared with the same period last year. According to Rightmove Commercial, the bounce back is being fuelled by Bank of England interest rate cuts, which are now at 4 percent. 

Research by the commercial property website revealed that high-street retail investment demand – which makes up a large proportion of the retail sector – is up by 56 percent compared with the same quarter in 2024. It is the highest this figure has been since 2021. Demand from businesses to lease retail space is also up by 10 percent compared to last year. 

This upward trend is particularly marked in areas such as Greenwich, Blackheath and Deptford in South London, which are retail and leisure destinations for tourists and other visitors as well as serving loyal local communities. ‘A steady stream of enquiries has come from investors and owner-occupiers for available retail units on streets including Nelson Road in Greenwich, Deptford High Street, Montpelier Vale in Blackheath and Woolwich Church Street in Woolwich,’ said Kevin Bright at Hindwoods. 

Impact of interest rate cuts

Just a year ago demand to invest in the retail sector overall was down by 15 percent compared with the previous year, and investor interest in the sector had been stalled since 2022. But Bank of England base rate cuts in May and August 2025 have helped boost demand for retail property acquisition. Lower financing costs mean both institutional and private investors have greater confidence, especially in established high street locations with consistent tenant demand. 

‘As an example, the streets in and around Greenwich Market are home to properties that have recently been let by Hindwoods to businesses that range from therapy rooms and cafes to clothing boutiques and gyms,’ says Bright. ‘Niche businesses, new entrants and multi-site operators like the quirkiness of the streets and the cachet of the area and want to make a statement about their brand by opening there.’ 

He added that as footfall returns to key local thoroughfares and with ongoing regeneration projects in places like Woolwich town centre, Hindwoods has received increasing instructions from both start-ups and well-established independent brands looking for visible, well-connected retail space. It is a trend that is backed up by Rightmove’s data; the number of businesses wanting to lease retail space is up by 10% compared to 2024.

‘Local businesses appear to be blending online and physical presence, this has led to growing interest in adaptable, smaller format units that can double as fulfilment points for e-commerce collections,’ said Bright.

Demand is also being boosted by a tightening of supply. Rightmove data shows retail investment supply is down by 4 percent year-on-year across the UK. Many landlords with quality high-street sites may be choosing to hold assets in anticipation of further value growth.

Business demand

Demand to invest in commercial property overall is up by 20 percent compared with the second quarter of 2024, according to Rightmove. Demand from investors for office space is 65 percent higher than last year, which was previously down by 13 percent year-on-year. Office space demand is creeping up as organisations work out how to balance remote, hybrid and in-person working. ‘Many businesses want more flexible solutions and we are able to offer that across our portfolio of properties,’ explains Bright. Across London demand to lease office space is 14 percent higher than this time last year. 

The outlook

Looking ahead to the second half of 2025 the expectation is for more demand from investors across all sectors. Bright anticipates continuing competition for high-quality retail and mixed-use units on prime streets in SE10, SE3, SE18, and surrounding postcodes. ‘With macroeconomic signals remaining favourable and local regeneration backed by public and private investment, South London appears well-placed for ongoing growth.’

For investors, timing the acquisition or disposal of assets may be crucial as capital values potentially bottom out and new demand cycles begin. For local occupiers, acting decisively may be vital, as tightening supply could see prime sites snapped up quickly.

Explore Hindwoods properties on Rightmove Commercial