Investors are cautiously optimistic this year, with 55% expecting investment volumes to rise and 45% to remain level. Most investors don’t expect prime yields to tighten significantly this year: 55% predict prime yields at the end of 2025 will be between 4.5% and 5.0%. Given we currently see prime yields as 4.75%, this implies only limited potential for tightening, with just 29% of investors expecting yields to fall below 4.5%.

Investors remain focused on core locations: South East (80%), West Midlands (63%), East Midlands (61%) and London (61%). By product type, 55% of investors are targeting prime logistics over the next 12 months, 51% prime multi-let, and 63% last-mile logistics.

Pricing aspirations are the most important factor for investors when deploying capital (for a second consecutive year). Since 2022, investment activity has been suppressed by gaps in pricing expectations between purchasers and vendors, and we expect this issue to continue to dominate the market in 2025. Concerns around occupier market conditions and rental growth, which reflect the uncertain environment and outlook, are also top of mind.

When asked about the factors affecting the wider industrial and logistics industry, it’s encouraging to see investors aligned with occupiers. The health of the economy is key, but issues such as power availability and ESG feature prominently.

_{Read the articles within Future Space Report 2025 report below}