Savills, the property company, is adamant that deals and leases that did not get signed during the turbulent spring will happen later this year — but the stock market is not so optimistic.
After a decent start to 2025 on the back of cuts to interest rates, the London-listed agent recorded a “slowing of transactional activity” from April, which it blamed on “economic and trade policy uncertainty”. The bigger the transaction, the more likely it was to be pushed back, Savills said.
“In the first quarter, commercial transactions were picking up from the end of last year,” Mark Ridley, the chief executive, said. “Then in the second quarter, with all the noise around ‘liberation day’ [tariffs], we ended up in a bit of a sand trap. China was particularly affected. None of [the deals] have fallen away; they just didn’t transact. Some of that hesitation is unlocking already. Momentum has been improving since June.”
Despite the spring slowdown, Savills still expects to deliver the kind of profit that shareholders had been hoping for this year. The consensus is that annual underlying pre-tax profit will rise to £148 million from £130.4 million in 2024.
Savills accepts that it will need a good second half, but stressed that, after the postponements in the spring, it now had “strong pipelines” for the coming months.
Stock market investors, however, are concerned that it might take longer than bosses think for those delayed deals to restart. Zac Gauge, a real estate industry analyst at UBS, said: “The pace of execution is likely to be affected by the unpredictable development of geopolitical events.”
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Savills shares fell 55p, or 5.6 per cent, to 920p on Thursday, their biggest one-day fall in five months.
Founded in the City of London in 1855, Savills has grown to become one of the UK’s biggest property agents. It is thought of by many as a traditional residential estate agent, but that makes up only a tenth of its business. Its agents broker sales of warehouses, find offices for businesses and line up deals for investors. Most of its fees come from “less transactional” divisions such as investment management, property management and a consultancy business.
In the first six months of 2025, the group recorded revenues of £1.13 billion, 6 per cent more than the £1.06 billion it reported in the same period of 2024. There was a marked difference between the first and second quarters, however. Revenues between January and March were 12 per cent higher than a year earlier, while growth dropped to 1 per cent between April and June.
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Reflecting the broader improvement in commercial property markets, interim pre-tax profit jumped 78 per cent to £15.8 million from £8.9 million. Underlying pre-tax profits, Savills’ preferred profit measure, rose 10 per cent to £23.3 million. The half-year dividend was raised by 4 per cent to 7.4p per share.