Cardiff Commercial Property Market Guide: Office, Industrial, Retail and Development (2026)

Cardiff is the capital of Wales, its largest city, and the centre of a city-region economy responsible for more than half of Wales's total economic output. Its commercial property market is in a period of structural transition: the strongest office take-up cycle in nearly a decade, driven by financial services and technology occupiers; a critically constrained Grade A supply that is pushing prime rents to record levels; and a pipeline of regeneration investment — anchored by the £300 million Atlantic Wharf arena — that will reshape Cardiff Bay and strengthen the city's position as a destination for business, culture, and investment.

This guide draws on data from Knight Frank, Savills, Cardiff Capital Region, Cardiff Council, and the Atlantic Wharf development partnership.

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The Office Market

Current market conditions

2024 was Cardiff's strongest office year since 2016. Total take-up reached 581,643 sq ft according to Knight Frank — more than double the total for the previous 12 months, with 92 deals concluded at an average deal size of 6,322 sq ft, 40% ahead of the ten-year average. A particularly strong final quarter contributed 247,137 sq ft, the highest quarterly return since Q3 2017.

The take-up trajectory through 2024 was consistently strong: year-to-date at Q3 2024 totalled 334,500 sq ft, 56% ahead of the equivalent period in 2023 and the strongest first nine months of a year since 2017.

Rents

Prime office rents in Cardiff reached £28 per sq ft in Q3 2024 — the first increase in prime rents since 2016, and a significant turning point for a market that had been stable at £25 per sq ft for several years. Knight Frank forecasts rents will exceed £30 per sq ft in 2025, driven by the continuing decline in Grade A availability and several live requirements in the 15,000–50,000 sq ft range for which suitable supply is extremely constrained.

Despite this growth, a structural gap remains between Cardiff and other major UK regional cities. By Q3 2024, the average prime rent across comparable regional cities stood at £38 per sq ft, with the highest at £48 per sq ft — making Cardiff's gap with regional peers the widest in Knight Frank's recorded data. This gap reflects both Cardiff's historically lower cost base and the structural undersupply of modern, high-quality space that has only recently begun to drive rental growth.

Key occupiers and notable deals

The financial services and banking sector dominated Cardiff's 2024 office market, with 17 deals in the sector totalling 253,057 sq ft — accounting for more than half of the year's total take-up.

Lloyds Bank — 1 John Street (113,000 sq ft) — the standout deal of 2024 and one of the most significant office transactions Cardiff has seen in years. Lloyds Bank pre-let the entire 113,000 sq ft 1 John Street building at the head of Callaghan Square, a standalone building designed to BREEAM Excellent certification with a roof terrace and fitness suite. The building is due to complete in 2025, with Lloyds Bank expected to complete its move in Q2 2026.

PwC — 1 Central Square (33,166 sq ft) — professional services firm PwC signed for space at one of Cardiff's premier Grade A addresses, Central Square, which has emerged as the city's defining new commercial district.

Aldermore Bank — 2 Central Square (28,098 sq ft) — the digital challenger bank relocated to Central Square, consolidating the cluster of financial services occupiers in this quarter.

Starling Bank — Brunel House — expansion from the digital bank reflected Cardiff's growing role as a fintech and digital financial services hub.

Go Compare — Hodge House — price comparison platform Go Compare relocated to Hodge House, adding to the technology and professional services mix in the city centre.

Welsh Government — Cardiff Gate Business Park (51,411 sq ft) — the largest out-of-town deal, acquiring Centre 7 at Cardiff Gate to create a new hub for the semiconductor industry, reflecting Wales's growing ambition in the advanced technology sector.

The acute supply challenge

Grade A availability in Cardiff has dropped below 300,000 sq ft, and with no new buildings delivered in 2025, the severe lack of prime office space is the market's defining structural constraint. John Street — a speculative development of 107,000 sq ft by JR Smart at Callaghan Square — was the only new speculative office development under construction during 2024 and is now complete. Beyond this single scheme, the pipeline is empty.

The development pipeline in Cardiff remains limited. With several live requirements between 15,000 and 50,000 sq ft in the market, and virtually no new supply coming forward, competition for available Grade A space is intensifying rapidly. Knight Frank's Mark Sutton described the market in January 2025 as one where "the availability of Grade A space will continue to decline" and rents will be pushed "beyond £30 per sq ft this year."

The market is polarising sharply. Buildings with modern amenity, strong EPC credentials, and well-designed collaborative workspaces are generating strong occupier demand and short void periods. Older buildings lacking significant capital improvement are experiencing materially greater challenges and are increasingly candidates for repurposing to residential, hotel, or alternative uses.

What occupiers look for

Cardiff office occupiers consistently prioritise Central Square and the Callaghan Square/Capital Quarter area as the primary Grade A locations; buildings with BREEAM Excellent certification and strong EPC ratings; proximity to Cardiff Central station (with direct services to London Paddington in approximately two hours); access to the Cardiff University and Cardiff Metropolitan University talent pool; and modern, flexible floorplates designed for hybrid working. The average deal size at 6,322 sq ft in 2024 — 40% above the ten-year average — reflects the consolidation trend: occupiers seeking quality over quantity, moving into better, smaller, and more efficient space.

Demand sectors

Financial services and banking has been the dominant demand driver, supported by Cardiff's established position as a major UK financial centre — home to significant operations from Lloyds Banking Group (including Halifax, Bank of Scotland, and Scottish Widows), HMRC, and a growing cluster of digital financial services firms. The semiconductor and technology sector is an emerging demand driver, supported by the Welsh Government's strategic investment at Cardiff Gate and the wider focus on advanced manufacturing and digital in the Cardiff Capital Region's investment strategy.

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The Industrial and Logistics Market

Current conditions

Cardiff's industrial and logistics market serves both the city's immediate hinterland and the broader South Wales economy. The Celtic Freeport — a jointly designated UK and Welsh government freeport covering the ports of Milford Haven, Port Talbot, and associated sites — is expected to be a significant driver of industrial and logistics demand in the wider South Wales region over the coming decade, with customs advantages, tax reliefs, and infrastructure investment incentives attracting advanced manufacturing and logistics investment.

The South Wales M4 corridor provides the primary logistics spine, linking Cardiff to Newport, Swansea, and the wider South Wales conurbation. Key industrial locations include Treforest Industrial Estate (one of Wales's oldest and most established industrial parks), Wentloog (east Cardiff, close to the M4), Cardiff Business Park, and the newer developments in Newport and the Eastern Valley corridor.

Industrial demand in Cardiff and South Wales is underpinned by e-commerce, supply chain reconfiguration, food and drink manufacturing (a significant sector in Wales), and the defence and aerospace industries centred on St Athan and the Vale of Glamorgan.

What occupiers look for

Industrial occupiers in Cardiff prioritise M4 motorway access, proximity to the Port of Cardiff and Bristol Channel ports for import/export logistics, modern specification (eaves height, dock-level loading, EV charging), EPC A or B rating, and access to Wales's manufacturing workforce. The semiconductor and advanced electronics supply chain — supported by the Welsh Government's Cardiff Gate hub — is generating demand for specialist industrial and R&D space alongside standard logistics.

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The Retail Market

Current conditions

Cardiff is the principal retail destination in Wales and one of the UK's top ten retail centres. The city's retail market is anchored by St David's — a 1.4 million sq ft shopping centre accommodating over 180 stores — alongside St David's Dewi Sant, the Queen's Arcade, and the Victorian Arcades that give Cardiff its distinctive retail character. City centre retail sales grew 3% in 2024, according to available data.

St David's holds approximately 48% of Cardiff's city centre retail market share and continues to attract major national and international brands. The centre benefits from one of Wales's strongest consumer catchments: the greater Cardiff city-region population of over 1.5 million, combined with regional draw from across South Wales and border areas.

Retail parks have performed robustly, benefiting from convenience retail, discount operators, and the consolidation of occupiers into accessible out-of-town formats. Cardiff Bay's Mermaid Quay provides a complementary leisure and waterside dining offer.

Strengths and challenges

Cardiff's retail strengths are structural: a young, diverse, and growing population; a significant student population from two major universities; a strong tourism and cultural visitor economy supported by events at the Principality Stadium and national cultural institutions; and a legacy of Victorian-era shopping arcades that give the city a distinctiveness no modern development can replicate.

However, Cardiff faces the same structural challenges as every UK city centre: e-commerce capturing an increasing share of retail spend, a difficulty attracting and retaining occupiers in secondary retail pitches, and the need to evolve the retail offer towards experience-led and leisure uses.

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The Development Market

Atlantic Wharf — the defining regeneration project

The Atlantic Wharf regeneration scheme is the most significant urban development project in Cardiff in a generation. The 30-acre mixed-use masterplan in Cardiff Bay is anchored by a new 16,500-capacity indoor arena for live concerts, family shows, comedy, and sport — the first major new arena to be built in Wales.

Key facts about the scheme:

• Arena capacity: 16,500 seats, delivering approximately 140 event nights per year and an estimated 1 million additional visitors to Cardiff annually
• Developer: McLaren Construction, working with Live Nation and Robertson Property for Cardiff Council
• Construction start: 21 July 2025 (groundbreaking ceremony), with the core structure being installed by January 2026
• Anticipated opening: 2028 — the same year Cardiff hosts the opening match of UEFA EURO 2028
• Total Phase 1 investment: £300 million, having increased from an original £250 million estimate due to construction cost inflation
• Estimated annual visitor spend: £92 million, primarily captured by hotel, retail, and leisure development within the wider Atlantic Wharf masterplan

The arena is described by Cardiff Council leader Councillor Huw Thomas as transformational: "This arena will transform Cardiff's visitor economy in a way nothing has since the Principality Stadium opened in 1999."

The wider Atlantic Wharf masterplan — a £500 million+ regeneration scheme across 30 acres — is structured in four phases:

• Phase 1 (under construction): Arena, hotel, and multi-storey car park. Also includes the Capella — a new 550-seat digital and immersive arts theatre being built alongside the arena as part of a creative production centre linked to the Wales Millennium Centre
• Phase 2: Relocation of Red Dragon Centre tenants and construction of a new purpose-built leisure, food and drink facility, incorporating a new cultural centre, potential National Art Gallery, and a 'This is Wales' visitor attraction
• Phase 3: 150,000 sq m of new office space, delivered alongside an additional hotel
• Phase 4: A new residential neighbourhood with potential for retail and office space, dependent on the relocation of County Hall to a new purpose-built building

The Cardiff Council office building (Plot 18 / Capella) was targeting Q1 2025 commencement, with practical completion by Summer 2026.

Central Square

Central Square, developed by Rightacres and located immediately adjacent to Cardiff Central station, is Cardiff's most significant recent office development — a cluster of Grade A buildings that have defined the prime end of the city's office market since the first phase opened in 2017. Tenants include BBC Wales (which relocated its Wales headquarters to the scheme in 2019), ITV Wales, PwC, Aldermore Bank, and Transport for Wales.

The scheme has reshaped the area immediately around the station and established the template for what Cardiff's best office occupiers now expect. The question for the market is what follows Central Square in the pipeline — and currently, no equivalent new-build scheme has been announced.

Capital Quarter and Callaghan Square

Capital Quarter and the wider Callaghan Square district form Cardiff's other primary commercial cluster, housing the financial services occupiers that anchor the city's office market. The Lloyds Bank commitment at 1 John Street — a 113,000 sq ft pre-let at the head of Callaghan Square, completing in 2025 with occupation from Q2 2026 — anchors this district and validates the continued investment in the area.

Cardiff Parkway Station

The proposed Cardiff Parkway station — a new railway station on the Newport to Cardiff line, adjacent to the Celtic Gateway business park — is a significant commercial property catalyst for the eastern Cardiff business park market. The station would provide rail access to Cardiff Gate Business Park and surrounding employment sites, improving connectivity for businesses and employees in a currently car-dependent location. The project is being progressed alongside the Atlantic Wharf development, with a planned transport interchange connecting to the Metro network.

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Infrastructure Shaping the Market

Cardiff Crossrail and the Metro

Cardiff Crossrail is a planned tram and light rail link between Cardiff city centre and Cardiff Bay, designed to provide frequent, high-capacity public transport along the Lloyd George Avenue corridor. The scheme is an integral part of the Atlantic Wharf regeneration: the arena is expected to generate the footfall needed to support the new line, and the council sees this connection as key to completing the long-planned link between the Bay and the city centre.

More broadly, the Cardiff Capital Region Metro programme — funded partly by the UK City Deal — aims to double the frequency of services across the rail network spine connecting Cardiff to the South Wales Valleys and surrounding commuter settlements, as well as delivering improved bus rapid transit across the city-region.

Cardiff Central station and rail connectivity

Cardiff Central station provides direct services to London Paddington (approximately two hours) and connections to Bristol, Swansea, and the wider South Wales and West of England network. Cardiff Queen Street provides additional city centre access and onward connections to the Valley Lines and the Bay. The proximity of Central Square to Cardiff Central station is a primary reason for its success as a Grade A office address, and rail connectivity is consistently cited as a critical location factor by Cardiff office occupiers.

UEFA EURO 2028

Cardiff will host the opening match of UEFA EURO 2028 at the Principality Stadium — the same year the Atlantic Wharf arena is expected to open and Cardiff Metro improvements are scheduled for delivery. Council leader Councillor Huw Thomas described 2028 as set to be "a spectacular year for the city," positioning it as a year of convergence between major infrastructure completions, a flagship sporting event, and the opening of transformative new cultural and leisure infrastructure.

Celtic Freeport

The Celtic Freeport — one of the UK's freeport designations covering sites in south and west Wales — offers customs and tax benefits designed to attract investment in advanced manufacturing, renewable energy, and logistics. Port Talbot, Milford Haven (including Pembroke Dock), and associated sites are included. The designation is expected to generate demand for industrial, logistics, and manufacturing space in South Wales over the medium term, with potential spillover effects into the Cardiff city-region supply chain.

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Challenges Facing Cardiff's Commercial Property Market

Development viability and the pipeline gap. With John Street as the only new speculative office building completed in recent years, and no equivalent scheme in the pipeline, Cardiff faces a structural supply problem that rising rents alone may not resolve quickly. Build costs in South Wales have increased significantly, and the development viability gap — the difference between achievable rents and the cost of new-build delivery — remains a constraint even as prime rents approach £30 per sq ft. Without further development starts, the Grade A vacancy rate will continue to decline and occupier choice will be severely limited.

The rent gap with regional peers. Cardiff's prime rents, at £28–£30 per sq ft, are materially below comparable regional cities at £38–£50 per sq ft. This has historically reflected lower land and construction costs in Wales, a smaller occupier pool, and lower average deal sizes. As rents converge with UK averages, Cardiff becomes more viable for development — but the gap also represents a risk if development costs rise faster than achievable rents.

Atlantic Wharf delivery timeline. The arena's opening date has already shifted several times, from 2026 to 2027 to 2028, as costs have risen and programme complexities have been managed. For the wider Atlantic Wharf masterplan — including the office phases — the arena is the catalyst: Phase 3's 150,000 sq m of office space depends on the visitor economy and confidence that the arena generates. The later phases are dependent on further public investment and the relocation of County Hall.

Secondary office obsolescence. As in every UK city, Cardiff's secondary office market faces structural pressure. Buildings that do not meet modern occupier expectations for sustainability, flexibility, and amenity are struggling to let. The conversion of redundant office stock to residential use is a partial solution, but risks permanently reducing commercial floorspace in a market that already faces a shortage of quality supply.

Retail structural challenges. Secondary retail pitches in Cardiff — away from St David's and the Victorian Arcades — face the same pressures as every UK city: falling footfall, changing consumer behaviour, and difficulty attracting viable occupiers. The Atlantic Wharf and Central Square schemes are drawing investment and footfall southward and eastward; the consequences for traditional retail pitch hierarchy in the city centre are still playing out.

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Frequently Asked Questions

What is the current prime office rent in Cardiff?

Cardiff's prime office rent reached £28 per sq ft in Q3 2024 — the first increase in prime rents since 2016 — and is forecast by Knight Frank to exceed £30 per sq ft during 2025, driven by the declining availability of Grade A space below 300,000 sq ft and several live requirements in the market. Despite this growth, Cardiff's prime rents remain materially below comparable UK regional cities, which averaged £38 per sq ft prime at Q3 2024.

What was the standout office deal of 2024 in Cardiff?

The standout deal of 2024 was Lloyds Bank's pre-let of the entire 113,000 sq ft 1 John Street building at the head of Callaghan Square — a standalone building developed by JR Smart to BREEAM Excellent certification, with a roof terrace and fitness suite. The building completed in 2025, with Lloyds Bank expected to complete its move in Q2 2026.

What is the Atlantic Wharf arena and when does it open?

The Atlantic Wharf arena is a new 16,500-capacity indoor venue for live concerts, family shows, comedy, and sport, under construction in Cardiff Bay. Construction began on 21 July 2025, with McLaren Construction as the main contractor and Live Nation as the operator. The arena is expected to open in 2028 — the same year Cardiff hosts the opening match of UEFA EURO 2028. At £300 million, it is the most significant cultural and entertainment infrastructure investment in Cardiff since the Principality Stadium. The arena is the first phase of a wider 30-acre Atlantic Wharf masterplan that will eventually deliver over 1.2 million sq ft of mixed-use development.

Why is Cardiff attracting financial services occupiers?

Cardiff is the UK's third-largest financial services centre outside London and Edinburgh, with major operations from Lloyds Banking Group, HMRC, Admiral, Legal & General, and a growing cluster of digital financial services firms including Starling Bank and Go Compare. Cost advantages relative to London, a large graduate talent pool from Cardiff University and Cardiff Metropolitan University, excellent rail connectivity to London (approximately two hours), and a high quality of life for employees all contribute to Cardiff's appeal. The financial services and banking sector accounted for over half of Cardiff's 2024 office take-up.

What is the Cardiff Metro and how will it change commercial property?

The Cardiff Metro is a programme to transform public transport across the Cardiff Capital Region, doubling service frequencies on core rail routes connecting Cardiff to the South Wales Valleys and improving bus rapid transit across the city. The programme is partly funded by the £1.28 billion UK City Deal for the Cardiff Capital Region. The Cardiff Crossrail element — a planned light rail or tram link connecting the city centre to Cardiff Bay — is specifically designed to support the Atlantic Wharf regeneration by providing frequent public transport access to the new arena and the wider Bay development. Cardiff Parkway station, a proposed new rail station in east Cardiff, would improve connectivity for the Cardiff Gate business park cluster.

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Cardiff's commercial property market is at a pivotal moment: the strongest office demand cycle in nearly a decade, a transformative arena and Bay regeneration in active construction, and a prime supply shortage that is driving rents to record levels. For businesses considering a Welsh presence or seeking to understand the city's commercial property landscape, 2026 is a year of genuine momentum — with 2028 set to be the year the investment and infrastructure programmes deliver their most visible results.

If you are looking for commercial space in Cardiff or the wider South Wales region, post your requirement on REmatch — describe what you need, and landlords and agents with matching property will respond directly to your brief.