Beyond the Budget: What should property owners do now? Key takeaways from Property Performance 2026

Despite containing almost 100 individual measures, the Budget did little to alter the UK’s underlying growth trajectory. And for the room of more than 120 industry experts, the message was clear: the market will not do the work for property owners either. 

The Budget did however signal an important change of direction.

Simon French, Chief Economist at Panmure Liberum, described the Treasury’s move on energy policy as a “long-overdue land grab” – one that reflects a growing recognition that sustainable growth depends on reducing energy costs for businesses and households. For asset owners, energy is becoming central to operating performance, infrastructure capacity and future building use.

The wider discussion focused on how property can perform while finance remains expensive and development viability is under pressure. Here are nine key takeaways from the briefing.

1. Use stability as a window for action

The Budget was welcomed by financial markets for providing stability rather than seismic change. But stability alone won't resolve the structural pressures facing the market. Owners should use the breathing space to assess their assets, and act.

As Tim Robinson, Head of Commercial & UK Managing Partner Elect at Knight Frank, observed: “doing nothing isn’t the same as taking no risk”.

Waiting rarely makes a difficult decision easier, he added, and delay can carry an increasing cost. 

2. Build business plans for today’s cost of capital

The cost of capital is significantly higher than it was four years ago, and business plans should not rely on a rapid return to unusually cheap money.

Henrie Westlake, Head of UK Cities, compared the period of free money following the global financial crisis to an analgesic that removed the pain without addressing the underlying problem.

Owners can no longer wait for lower rates or yield compression to restore performance. Income will need to contribute more to returns, requiring business plans built for today’s market rather than the historic one owners would prefer to see.

3. Put energy at the centre of asset strategy

While French pointed out that the Budget marked a clear shift from cleaner towards cheaper energy, for property owners the outlook remains challenging. David Goatman, Global Head of Energy and Sustainability, encouraged owners to consider the three Cs: cost, capacity and carbon.

That means having a strategy to mitigate higher costs, understanding how much power each building can import and export, while planning for its long-term carbon performance. It may involve more innovative procurement, power purchase agreements, on-site renewables, battery storage or connections to local infrastructure, like heat networks.

Energy capacity is increasingly material to what can be delivered at a site. Owners who do not understand their position risk being fully exposed to rising markets, or discovering that their asset strategy cannot be supported by existing infrastructure.

4. Prepare for a more devolved property market

Further devolution could give regions greater control over infrastructure, investment and development. Westlake noted that the UK raises significantly less tax at a subnational level than other major economies, leaving considerable scope for decisions to move closer to local markets.

But this could also lead to greater variation between regions. As local authorities focus more closely on attracting businesses and investment, owners should engage with decision-makers early and understand the funding, infrastructure and political priorities influencing each location.

Private and institutional capital could also play a greater role in delivering regional infrastructure.

5. Start refinancing earlier – and test the whole market

The commercial real estate debt market remains highly liquid, giving borrowers opportunities to secure competitive terms. But lenders are examining business plans, cash flows and underlying assumptions much more closely.

Lisa Attenborough, Head of Capital Advisory, advised owners to begin thinking about refinancing strategies approximately 12 months in advance – twice the lead time she might previously have recommended.

That gives borrowers time to prepare a detailed and justifiable lender pack, test assumptions around re-letting, rental growth, expenditure and exit values, and approach a broad section of the market. With significant liquidity on the table, owners should shop around rather than assume their existing lender will offer the best terms.

6. Treat every property as a business

Property may compete with every other asset class for global capital. Owners therefore need a credible business case for each asset, grounded in its income, costs, operations and future demand.

This can help property compete on a more level footing, while giving investors and lenders the evidence they need to assess its prospects. Greater scrutiny should allow good property to stand out, while weaker assets and assumptions will be exposed.

7. Do the little things well

There is no single solution that will transform asset performance. Drawing on Sir Dave Brailsford’s philosophy of marginal gains, Westlake argued that performance will increasingly come from doing many smaller things well.

Proactive maintenance, new lettings, rent reviews and lease regears, appointing the best property managers, and good value service charges can all strengthen income and improve an asset's liquidity. Lowering an occupier’s total costs can also create greater capacity to pay rent, which reinforces the relationship between operational performance and investments returns.

8. Stop carrying outdated appraisals forward

Development has become harder, more expensive and more risk-weighted. Construction costs have risen sharply, while values have not always kept pace and some traditional sources of development finance have become more difficult to secure.

Nick Parr, Partner, Residential Development, urged owners to be honest about their business plans and appraisals. Rather than carrying forward assumptions created 12, 24 or 36 months ago, they should honestly review where a project stands today and put pen to paper on a new plan.

A new appraisal gives owners a realistic basis for deciding whether to proceed, adapt the plan or direct capital elsewhere.

9. Be bolder about repurposing and repositioning

The opportunity for repurposing and repositioning is there, Parr added, but unlocking it may require owners to consider a wider range of uses than they expected.

Current demand, infrastructure and deliverability should determine the most appropriate strategy, rather than the original consent or business plan. In some locations, that could mean reassessing residential land for industrial or logistics use. Elsewhere, existing infrastructure may support housing, co-living or other alternatives.

Lenders are also supporting some repositioning strategies. These include speculative office refurbishment where assets have been acquired at a rebased price, and the conversion of obsolete buildings such as hotels into co-living accommodation.

The common thread is the need to diagnose problems early, assess the evidence honestly and make a clear decision.

As Robinson concluded: “Diagnose early. Choose clearly. Act decisively.”

Knight Frank’s Commercial Consultancy teams bring together expertise across finance, investment, development, energy, property management and repositioning, helping owners assess their options and act.

Get in touch to find out more about our Commercial Consultancy services and Property Performance insights. 

Read more in-depth insights from the event here.