The Together report shows that total commercial lending will increase by 32% from an estimated £90bn in 2023 to £118bn in 2028.

And 23% of property professionals are looking to diversify portfolios and expand into new sectors.

Despite the inflation and high interests/mortgage rates, the report shows that the commercial property market is adjusting to this challenging economic environment. The adjustment is attributed to the bullish appetite of commercial developers, investors, and landlords either exiting or diversifying portfolios to mitigate falling yields and revenues.

Among all respondents, almost a quarter (23%) said student housing offered the most appealing property investment opportunity over the next 12 months.

This was followed by housing developments (21%) and luxury residential properties at 19%.

While 29% of property investors surveyed are aware falling property values may make securing lending difficult this year.

However, it’s not preventing the majority from capitalising on emerging growth sectors.

Nearly one in five (18%) of property investors surveyed are most excited to pursue retail projects this year, followed by housing developments (17%) and student accommodation at 16%.

For all respondents, office space (17%), hotels (15%) and industrial or manufacturing sites (13%) trigger the most hesitancy when considering potential commercial market opportunities this year.

A further 44% are planning to de-risk and shrink their property portfolio over the next 12 months.

Around half of those who are planning (48%) will do this in the next three to six months. And about a quarter (23%) are planning on doing it sooner.

While long-standing funding barriers and high interest rates continue to block access to the market for some with 22% of all respondents not confident about being able to access additional finance if they needed to.

However, the Together report makes evident the scale of the opportunity across the UK for property entrepreneurs.

The report also found that 52% of commercial landlords, investors and developers surveyed feel specialist lenders are best equipped to deal with their lending needs.

This comes as over two thirds (69%) of respondents anticipate the amount they must borrow to support their investment strategy will rise in the next 12 months.

Demand is apparent with 23% of all respondents feeling the commercial market is only improving and there are far more opportunities.

And 18% say the opportunity to generate more money is high and 16% that purchase prices have reduced allowing them to snap up deals and new opportunities.

Together group channel development director Chris Baguley said: “As we look at the UK commercial property landscape, the scope and diversity of the opportunities is impressive. Whether its student housing, housing/residential development or repurposing retail and other larger sites, the next few years are going to provide significant growth for the UK commercial property market. The optimism of the sector, combined with the economic recovery, mean those investors that are well poised with the right finance support will ultimately be in the best position to capitalise on these opportunities.”

Mortgage Lenders Association principal researcher Rob Thomas added: “The research we’ve undertaken shows that, while some property professionals are scaling back or exiting the market, the majority are committed to developing their portfolios and many are even taking advantage of the temporary reduction in property prices to expand. When looked at in the round, the scale of the opportunity is significant.”