Property investment in the UK showed signs of resilience with the office sector delivering its best quarterly performance in almost two years according to Lambert Smith Hampton.

After a record low volume in 2024, the office sector rebounded in Q1, up 10% quarter-on-quarter to £2.4bn. Central London led the recovery with £1.8bn of volume, including six deals over £100m.

Ezra Nahome, CEO of Lambert Smith Hampton, said: “While Q1 clearly reflects a more cautious tone in the market, it would be wrong to equate that with inactivity. Yes, we've seen a pullback from large-scale deals and more caution from institutions, but there’s still a healthy depth of activity, particularly from more agile, opportunity-focused investors.

“In recent weeks, US-backed investors—typically a key driver of UK volumes—have put their foot on the ball. This is a direct response to tariff-driven turbulence and broader geopolitical uncertainty. The flip-flopping narrative makes it difficult for US capital to commit with conviction in the near term.

“However, volatility can also bring opportunity. The recent instability across global financial markets is likely to reinforce the appeal of real estate as a stable, income-generating asset class. And, with growing expectations of accelerated rate cuts, we’re already seeing improvements in debt pricing. This could well create a more favourable environment for a mid-year rebound in sentiment and activity.”

The total property investment Q1 transaction volume reached £9.3bn, representing a 35% decline on Q4 2024’s two-and-a-half-year high, and the lowest quarterly total since Q3 2023, the broader picture remains more nuanced.