Originally published in Green Street News 13.08.25
UK commercial property auction activity is a signal of what’s happening at the grassroots of the market and the first half of 2025 saw its strongest performance since the onset of the pandemic.
One of the most prominent themes through this period was the re-emergence of retail property as a central focus for investors. In Q2, retail assets comprised 63.6% of all auction sales, representing a considerable increase compared to 52.2% over the previous 12-month period and up from 49.1% in Q1 2025.
This shift marks a reversal from the recent past where retail assets had steadily lost ground to other commercial asset types and alternative investments. Investors now appear to be regaining confidence in retail, particularly in smaller, well-located high street units This is being driven by stabilising rental yields and more consistent tenant performance.
The allure of alternatives
Alternative property types such as leisure, healthcare, development land, and mixed-use properties are an increasingly prominent feature of the auction market landscape. In Q2, alternatives attracted nearly 26% of total auction sales, and reflected a broader strategy of diversification and risk mitigation.
London stays in the spotlight
During Q2 2025, assets in London accounted for 41.3% of total quarterly activity. This marks the highest quarterly sales volume for the capital in more than a year, reaffirming the city’s status as a prime destination for both UK-based and international investors. London’s appeal is based on its resilient rental demand, deep pool of investors, and its capacity to weather broader economic uncertainty better than other regions.
Small is beautiful?
The renewed focus on retail – particularly smaller, high-street units – has influenced the size and structure of deals within the auction market. In Q2, the average lot size dropped to £484,560, the lowest level seen in a decade. This shift represents a departure from the post-pandemic trend where larger, institutional-grade assets were dominating auction activity. Notably, only 9% of lots sold in Q2 were priced above £1m – the lowest proportion on record. The 37 higher-value lots that sold in Q2 generated accounted for 35% of the quarter’s total. By comparison, the previous 12-month average for properties above the £1m threshold represented 51.9% of all auction volumes.
This data suggests that investors are currently more inclined toward acquiring smaller, more manageable properties. This may be driven by reduced risk exposure, faster turnaround potential, and broader affordability. However, whether this trend continues will depend on the quality, availability, and pricing of such smaller assets in future auctions and the supply of the larger lots
Success sells
The overall auction success rate rose to 80.4% in Q2 which was just above the eight-year pre-pandemic average of 79.1% and signals a more stabilised market. The modest dip in success rates may reflect more selective buyer behaviour, but also indicates that sellers are increasingly adept at using pre-registration insights and bidder engagement data to determine the most effective sales strategies—whether selling ahead of the auction, proceeding on the day, or choosing to withdraw.
Market drivers and outlook
As we head to towards the Autumn auctions, several key trends are expected to shape the market.
Retail properties are likely to maintain their momentum, especially smaller, well-positioned units with reliable tenants. While alternative and mixed-use assets will remain attractive as investors seek stability and asset management upside.
London is expected to continue its strong performance due to sustained demand and liquidity, but the resilience of the auction market as a whole will hinge on macroeconomic conditions, consumer confidence, and the adaptability of investors and sellers alike.
While the commercial property auction market continues to evolve, its current trajectory suggests a healthy, if shifting, landscape – where informed decision-making, sector selectivity, and strategic agility are paramount.
