A study by debt advisory firm Sirius Property Finance, using data from Rightmove and Zoopla, has found the East of England is presently the most in demand region in Britain for both commercial property purchases and rentals.

The analysis revealed that 24% of all commercial lets in the area have already found tenants.

Sirius Property Finance attributed the high demand to low investment costs and high rental returns.

Across Britain as a whole, the average price of commercial real estate has fallen by 12.7% over the past year, while rents are up 4.9% annually. 

Across the East of England, the average price of commercial real estate has fallen by 9.2% during this period, while the average rent is up by 19.3%.

The South West and South East are also in the top three for both commercial sales and rental demand, while the North East is the least in demand region.

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The average commercial rent has risen 42.8% in the North East, second to the North West where it has climbed by 102.1%. 

The North East has also seen the largest uptick in the average price of commercial real estate, growing 15.9% in the past 12 months. 

“It’s certainly a bit of a mixed picture across the current commercial real estate sector and while a robust level of investor demand remains, upward price growth across some regions has impacted their appetite for investment, even when rental values have also increased notably,” said Kimberley Gates, head of corporate partnerships at Sirius Property Finance. 

“In contrast, there are some regions, such as the East of England, that offer the ideal balance of softening property prices along with strengthening rents, and it’s no surprise that demand in these regions is substantially higher. 

“With the commercial sector having largely recovered from the impact of the pandemic, we expect to see demand continue to return to the sector, although this activity will be largely focussed in areas that offer the best bang for buck in what is becoming an increasingly difficult economic and financial landscape.”

The research highlighted that currently, 34.1% of all commercial property listings on the market have already been purchased by commercial real estate investors (under offer or sold subject to contract), while the cost of commercial real estate investment across the nation has fallen by 12.7% year-on-year.

Pictured above: King’s Lynn, a market town in Norfolk, East of England