Roughly £300m of commercial property was sold by councils last year, according to a new analysis.
Analysis from commercial real estate company CoStar found that in 2025, local authorities sold £540m of commercial property.
2025 also saw councils hit their lowest spend (£245m) on commercial properties in more than 10 years, resulting in a net expenditure of minus £300m. With a large proportion of the assets having been sold in the latter half of 2025, the company said that councils were ‘heavy net sellers of UK commercial property last year’.
According to CoStar, this marks the ‘largest level of disinvestment since the spending spree came to an end during the pandemic’.
The 2016-2020 spending spree involved councils investing in commercial property, facilitated by ultra-low interest rates on long-term loans, with the aim of generating income to combat local authority funding decreases.
CoStar found that Spelthorne Council was ‘the most notorious of the big spenders in the boom period’, with more than £1bn having been spent by the local authority on commercial properties – largely offices.
‘The pivot towards disinvestment will continue in 2026 and beyond as Spelthorne and other big-spending councils retreat from commercial property. This will likely pique the interest of more bargain-hunting investors as and when clarity returns to the investment market in the coming months’, the report reads.
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