Investment deals in the Welsh commercial property market reached a combined £220m between January and the beginning of October, up 43% on the same period in 2025, according to new research from property advisory firm Knight Frank.
Following a strong first half, a further £39m of transactions were completed in the third quarter. This was marginally below the £47m recorded in the same period of 2025.
Assets changing hands included Bridgend Industrial Estate, a retail unit on Dunleavy Drive in Cardiff Bay, the Biffa Waste Services facility at Swansea Enterprise Park and Parc Bryn Llywd in Bangor.
Investor activity and market share
Private investors - predominantly property companies (propcos) and high-net-worth individuals - continued to dominate deal activity, accounting for 63% of the market. International investors were the next most active group, with a 16% share of investment, followed closely by institutional buyers at 15%.
With a number of notable transactions progressing and likely to conclude in the final three months of 2026 - including the recently announced deal for the 115,000 sq ft 1 John Street office building in Cardiff and the anticipated sale of Cardiff's Morgan Quarter shopping arcade - Knight Frank said it expects a strong end to the year in Wales.
Notable transactions and outlook
The investment in 1 John Street, which is fully let to Lloyds Bank, was sold by its speculative developer JR Smart to West Wales property investment firm Second Horizon. The value of the deal was not disclosed after the freehold interest in the 10-storey building was marketed with a £38.4m asking price. Lloyds recently took occupancy of the building for up to 2,500 staff, although it is expecting staff to be in office for 40% of the time under hybrid working arrangements.
Gareth Lloyd, capital markets partner at Knight Frank Cardiff, said: "The last three months may have been a bit quieter, but the wider picture in Wales has been remarkably resilient so far in 2026. Even with geopolitical and interest rates uncertainty lingering in the background, investors remain pragmatic and keen to deploy capital before the end of the year, while pricing has become more established outside London."
"There is a weight of money still eager to find a home, with many investors seeing a generational buying opportunity – prime office headline rents are at an early stage of their upward cycle in Wales, supply is tight, and demand for quality space is pushing values forward. Cardiff's appeal is also easy to understand: it is a capital city with three major universities, excellent graduate retention and a competitive workforce, and it regularly scores well on quality-of-life measures."
"Private capital remains highly active in Wales, with a mix of high-net-worth individuals, family offices, and propcos picking up where others have left off, while French investors continue to play a prominent role in the market. A number of significant sales are expected to land in the final quarter, reinforcing the momentum we have seen build in recent months and the sense that Wales, and Cardiff in particular, continues to be an attractive investment proposition."
