UK commercial property investment activity slowed during the first half of 2026, with transaction volumes affected by higher financing costs and continued uncertainty over pricing, according to Cushman & Wakefield.

The firm's latest UK Investment MarketBeat reported that investment volumes totalled £11.3bn in the second quarter, taking activity in the first half of the year to £23.4bn, 34% below the same period in 2025.

Total commercial property returns reached 0.8% during the second quarter, taking 12-month returns to 5.1%. However, Cushman & Wakefield said returns had moderated as higher gilt yields and borrowing costs continued to influence investor sentiment and pricing.

Investment activity remained focused on prime, well-located assets, with investors favouring properties offering secure income and strong occupational fundamentals. Secondary assets continued to face greater pressure, particularly where significant capital expenditure or repositioning was required.

The report said pricing remained sensitive to movements in debt costs and gilt yields, although the market was showing signs of greater stability following the sharp repricing seen in previous years.