Scotland’s commercial property investment market is expected to see improving liquidity and growing confidence in 2026, with most major investor groups anticipating stronger activity after a muted 2025.
New research from Lismore, based on its quarterly investor survey and interviews with senior market participants, indicates that easing interest rates and greater policy clarity are set to unlock pent-up demand.
According to the study, 86% of investors are optimistic about prospects for the year ahead, only slightly below last year’s 88%.
Sentiment is strongest among property companies and investment managers, while funds and private equity investors remain more cautious. Improved macro-economic visibility and stabilising debt markets are cited as key drivers of renewed activity.
BUDGET IMPACT
Market sentiment during 2025 was held back by weak economic growth and uncertainty ahead of the November Budget, which slowed transaction volumes and delayed decision-making.
However, expectations of lower borrowing costs and firmer occupational demand have lifted confidence that pricing will stabilise and that bid–ask spreads will narrow across prime sectors.
Sector preferences suggest continued demand for defensive income and structural growth stories.
Retail warehousing and living remain the most favoured asset classes, while industrial property continues to be a core allocation for many institutions. Offices and high street retail are also seeing signs of renewed interest as repricing works through the market.
COMMERCIAL OPPORTUNITY
Nick Peet, Divisional Managing Director, Real Estate Finance at Santander, says: “2026 promises opportunity in UK commercial real estate.
“Resilient market fundamentals, adjusted rents and lease structures, along with clearer tenant trends, position skilled operators to capitalise on pent-up demand and increased transaction activity in the year ahead.”
And Philip Eves, Investment Director of Buccleuch Property, adds: “2026 presents opportunities for exceptional returns.
“With strong advice and careful selection, assets in industrial and retail sectors can continue to benefit from rental growth.
“Having completed several sales this year, we are well-positioned to pursue high-demand, high-potential opportunities next year.”
POSITIVE OUTLOOK
Colin Finlayson (main picture, inset), Director at Lismore, says: “Our view for 2026 is more positive. Central belt logistics, prime retail and retail warehousing will continue to be in demand but we see appetite for offices growing, particularly where capex requirements are not demanding.
“In terms of buyers, private investors and family offices are expected to remain active, providing liquidity, while fund activity grows cautiously.
French SCPIs will continue targeting secure, longer-income assets, sustaining demand across key sectors.”
