Activity is returning unevenly across the property market. The strongest opportunities link demand with a clear plan for delivery, asset improvement or business operations.
Across Newsteer’s work in Q3, the focus has been on testing what can progress: whether a development can secure funding, an asset can support a different use, or an estate can meet changing business needs.
Development: opportunity is there, but viability still determines what moves
A more supportive planning backdrop is encouraging a reassessment of sites, particularly around transport nodes, brownfield land, Grey Belt and growth sectors such as logistics, data centres and advanced manufacturing.
But viability, construction costs, funding, land assembly and demand still determine what can progress, particularly on larger regeneration and housing schemes.
This is particularly evident across the living sector. Underlying need remains clear across private housing, affordable housing, student accommodation, co-living and build-to-rent, but activity is weighted towards operational or stabilised assets rather than a wave of new development. In London, private housing remains slow, affordable delivery is behind target, and student housing and co-living continue to face strong demand but difficult funding and planning conditions.
Two Newsteer projects illustrate the point: Convent Way in Hounslow, a major estate regeneration opportunity, and Woolwich Exchange, a significant town-centre redevelopment scheme. Both show how housing ambition, land assembly, planning, viability and delivery have to be considered together.
For developers, the priority is to resolve land assembly, policy requirements, costs and funding together, so that housing need can be translated into a viable delivery plan.
Occupiers: property decisions are being shaped by growth and operational need
Occupier demand is changing rather than disappearing. Office requirements remain part of the picture, alongside the wider operational and portfolio decisions businesses now face.
Businesses are assessing increasingly varied property requirements against growth, operational change, portfolio efficiency and future needs. Quality, flexibility, sustainability and location remain important within those decisions.
Occupier advice increasingly extends beyond acquisition to the ongoing operation of an estate. Newsteer’s Occupier Advisory work illustrates both sides: in Bristol, Hargreaves Lansdown expanded its occupation at Welcome Building during 2026, taking an additional floor following its 2025 relocation and increasing its Bristol HQ to over 116,000 sq ft. Elsewhere, the team has advised a global technology business on the operation of a complex central London estate, including running a competitive procurement process for new property and facilities management arrangements.
Different parts of the same business can also need different property solutions. The Occupier Advisory team’s work with DFS includes industrial property requirements alongside its established retail estate, demonstrating how property strategy needs to respond to operational requirements across a business.
We are seeing this particularly clearly in the defence sector. Businesses can move rapidly from research and development towards production as they grow, creating very different property requirements. Security, power, resilience, storage and the ability to adapt or expand can all become fundamental considerations when identifying the right property solution.
For occupiers, the test is whether space, lease terms and estate management support growth and operational change while retaining flexibility and control of costs. Newsteer’s Occupier Advisory team advises exclusively from that occupier perspective.
Investment: the question is increasingly what happens after acquisition
There is capital looking for opportunities, but buyers are increasingly focused on what can realistically be done with an asset after acquisition.
In retail, renewed shopping-centre activity during 2026 cannot be judged from price and income alone. Tenant mix, lease structure, alternative uses, surplus land, redevelopment potential and occupier demand all shape the long-term case.
The same caution is visible in the living sector. Institutional investors and affordable housing providers are largely focused on existing pipelines, while new London residential acquisitions remain selective. Build-to-rent activity is subdued, with interest in lower-rise regional opportunities where scheme-specific risks can be managed.
Joint venture and risk-sharing structures can offer an alternative to traditional forward funding, allowing parties to agree how delivery risk is allocated. Their suitability depends on the scheme, the funding requirements and each party’s capacity to manage that risk.
The due-diligence question is therefore not simply “is this a good investment?” but “what are the realistic routes to creating or protecting value?” Greater activity does not mean greater appetite for risk; it means investors are becoming more precise about which risks they are prepared to take, and why.
Asset strategy: challenged does not necessarily mean broken
The same selectivity is creating opportunity around assets that previously appeared difficult.
Higher finance costs, construction inflation, slower sales and planning delays have left some schemes stalled or restructuring, but a stalled project does not automatically mean the underlying real estate has lost its potential.
The task is to return to the fundamentals: location, consent, development mix, occupier demand, planning potential, capital requirements and likely exit.
For lenders, receivers, investors and owners, revisiting planning, changing the mix, adjusting phasing or repositioning an asset can materially affect the outcome.
Industrial and logistics: operational reality is shaping property decisions
In industrial and logistics, demand, location and land value remain fundamental, but site decisions are increasingly shaped by power availability, grid connectivity, transport, labour, servicing, resilience and planning.
Early assessment of power capacity, grid connection times and servicing requirements can help determine which uses a site can support and when. These constraints need to be reflected in acquisition assumptions and development programmes, not left until an occupier is identified.
For developers and investors, understanding occupier requirements before committing to a site helps align the specification, infrastructure budget and programme with the demand they aim to serve.
Planning is now part of commercial strategy
Planning needs to be tested before acquisition assumptions or asset strategies are fixed. It affects permitted uses, development capacity, obligations and the scope to adapt existing landholdings.
In the living sector, local policy and borough preferences for conventional residential can create barriers for student housing and co-living, even where underlying demand is strong. Housing priorities and affordable housing requirements need to be assessed for the relevant borough and site alongside viability, rather than assumed to apply uniformly across London.
The commercial benefit is an earlier understanding of what policy supports, what obligations may apply and which assumptions need to change before capital is committed.
What does Q3 tell us?
Q3 points to four linked conclusions.
- Confidence is improving, but activity is returning unevenly across sectors and assets.
- Demand alone is not enough: costs, funding and infrastructure determine which schemes can progress.
- Keeping several credible routes forward can reduce reliance on a single use, funding structure or exit.
- The right decision depends on the client’s objective: delivering a scheme, protecting asset value, assessing lending risk or supporting business operations.
Looking ahead
For the final quarter of 2026, the priority is to turn these conclusions into decisions: test delivery and funding assumptions before committing to a scheme, assess alternative uses for challenged assets, and align occupational commitments with business plans.
Viability pressures, infrastructure constraints and uncertainty over policy and funding remain material. A credible strategy needs to identify which risks can be managed, which require a different approach and which justify waiting.
The measure of progress is not simply more activity. It is a viable delivery plan for a developer, a defensible route to value for an owner or investor, a clear view of exposure for a lender, or property that meets an occupier’s operational needs.
Newsteer’s #OurSteer 2026 authors:
Alastair Crowdy, Managing Director
Ross Bettridge, Director, Development Consultancy
Jessica Wilson, Director, Planning
David Felman, Director, Occupier Advisory
Simon Martin, Director, Asset and Transaction Advisory
