"It’s astonishing how often an owner-occupier can buy their freehold property and still pay less each month than they do leasing the same building"
- Alasdair McPherson - Rangewell
The latest Commercial Property Demand Index from specialist finance firm Rangewell shows owner-occupied commercial mortgage activity is increasingly boosting market performance. Business owners are shifting from renting to buying their premises, reducing monthly costs while securing long-term stability.
Two key factors are driving this trend:
Monthly mortgage payments are now significantly lower than commercial rents, allowing businesses to cut costs while building equity
Full ownership of their premises gives business owners greater control and stability
Rangewell analysed Q2 demand across commercial property types by looking at the share of listed properties already sold. Retail led with 27.8% of total demand, followed closely by offices at 27.3% and industrial/warehouse units at 26.2%.
While overall demand held steady compared to Q1, the leisure and hospitality sector was the only one to see growth, increasing by 0.7%. Specialist subsectors such as specialist care, dental, and children’s day nurseries also showed strong moves from renting to owner-occupied status.
Despite relatively stable buyer activity, Rangewell noted a surge in enquiries and completions for owner-occupied commercial mortgages. Established businesses are seeking to protect operations and avoid rising rents by purchasing premises, ranging from retail units and warehouses to offices and industrial spaces.
Alasdair McPherson, commercial property expert at Rangewell, said, “When business owners realise that mortgage payments can be up to 37% less than rental payments and they’re building equity value in their property at the same time, the case for buying becomes obvious.
“It’s astonishing how often an owner-occupier can buy their freehold property and still pay less each month than they do leasing the same building,"
“The commercial market remains resilient, with retail and office properties proving most attractive to buyers. But what’s really fuelling activity beneath the surface is the increasing number of business owners looking to purchase their own premises,"
He added, “With commercial mortgages tailored for owner-occupiers, many businesses are making strategic decisions to invest in their future, take control of their location, and build long-term value.
“From our perspective, the commercial owner-occupied sector has never been busier, and lenders are lining up to grow their share in what’s fast becoming the most competitive segment in the sector.”
