Leading commercial property agent CBRE NI has reported a significant resurgence in commercial real estate investment activity during the second quarter of 2025, with total transaction volumes reaching £114 million - the highest quarterly figure recorded since Q3 2023.
The latest figures, published in CBRE NI’s Q2 2025 Commercial Property Market Report, bring the total investment spend for the first half of the year to £150 million. This not only represents a sharp increase on the £29.9 million transacted in Q2 2024, but also exceeds the full-year total of £118 million recorded across the whole of last year.
Retail assets dominated the quarter’s investment landscape, accounting for 78% of total spend, followed by offices at 20%. The strong performance was underpinned by continued resilience in the occupational markets, alongside a narrowing in the pricing gap between buyers and sellers.
Brian Lavery, Managing Director at CBRE NI, commented:
"Overall, we remain cautiously optimistic. The strength and consistency of demand across the retail, hotels, and office markets, combined with a stronger Q2, suggest a market that is steadily regaining confidence - even as global economic uncertainties and cost pressures continue to shape investor and occupier behaviour.
“The rebound in investment activity this quarter reflects muted confidence in the Northern Ireland market and a clear readiness from domestic investors to deploy capital in quality opportunities.
“The fact that investment volumes for the first half of 2025 have already outstripped the full-year figure for 2024 is encouraging, and a clear indication of renewed momentum across the sector.
“That said, investor caution remains a factor, particularly in the context of ongoing geopolitical instability and movements in the UK gilt market. We anticipate a quieter third quarter due to seasonality but expect renewed activity as we approach year-end."
Domestic investors maintained their majority share of the investment spend, contributing 84% of transaction volumes during the quarter with owner-occupiers contributing the remaining 16%. Domestic buyers have therefore contributed 73% of the total investment in commercial real estate during the first half of 2025.
Northern Ireland’s hotel sector also continued its positive trajectory through Q2 2025, bolstered by transactional activity, refurbishments, and new openings.
In Derry/Londonderry, the owners of the Ebrington Hotel completed the acquisition of Da Vinci’s Hotel, while in Belfast, boutique hotel Dukes at Queens was brought to market with offers invited in excess of £3 million.
On the north coast, Marine & Lawn Hotels & Resorts reopened the Adelphi Hotel in Portrush in April following refurbishment, ahead of the 153rd Open Championship taking place at Royal Portrush last week, while Andras House launched the Marcus Hotel Portrush, which is part of Hilton’s Tapestry Collection.
Despite these positive developments, financial pressures persist across the hospitality sector. A recent survey found that approximately 27% of hospitality operators are running at a loss, with a further 20% just breaking even and 6% of businesses reporting higher profits in 2025 compared to 2024 as rising costs continue to compress margins.
The Belfast office market recorded a total take-up of 81,768 sq ft across 10 deals in Q2 2025, an 18% increase on the same quarter in 2024. This brought the take-up level for the first half of 2025 to 139,560 sq ft across 21 deals, indicating steady progress.
The average deal size in Q2 stood at 8,176 sq ft, with the year-to-date average being 6,646 sq ft, indicating a healthy mix of both small and mid-sized lettings. Notably, take-up volumes increased by 41% in Q2 compared to Q1 – however, the number of deals decreased from 11 to 10, suggesting that although there were fewer deals, the transactions completed were typically larger in scale.
A number of new lettings in Belfast city centre have boosted the retail sector, with Donegall Place on track to reach full occupancy by the end of the summer. However, restructuring plans announced by River Island and Poundland across the UK could have an impact on Northern Ireland stores – a timely reminder of the underlying challenges that some retailers continue to face.
Brian Lavery added:
“The retail and hotel sectors continue to see new brand entrants, with both demand and footfall being driven by new lettings, sustained consumer interest, and hospitality events such as the Open Championship.
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“Hotel activity has remained strong, with further transactions, openings, and refurbishment projects reinforcing the appeal of Belfast and the North Coast as key destinations for tourism and investment.
“The office market is underpinned by activity in the serviced office space and sustained demand for best-in-class accommodation. While transaction volumes dipped slightly, the increase in average deal size along with several large active mandates point to a market that is adjusting to evolving occupational requirements with renewed focus on flexibility and quality.
“Our local market continues to secure fewer of the larger public sector relocation requirements compared to other regional UK locations and we would encourage our public sector leaders to continue to lobby for more representation.” View the full report here.
Sync NI's Summer 2025 magazine celebrates women in tech across Ireland as we continue to encourage more women to enter the thriving sector and address the current gender imbalance. Read the Summer 2025 Sync NI Magazine online for free here.
