Real estate was among the worst-hit sectors for company insolvencies in 2025, with 147 businesses filing for administration, according to analysis by law firm Shakespeare Martineau.

Out of 19 sectors the firm monitors, real estate, construction, retail, hospitality, and manufacturing collectively accounted for 56% of all administrations.

However, total filings declined slightly across all sectors compared to last year, apart from retail, which was the hardest-hit sector by a clear margin with 293 administration filings.

In total, 1,631 UK businesses filed for administration in 2025, down 5% on last year but 22% higher than in 2022. The law firm said UK companies are still facing significant pressures despite some signs of economic stabilisation.

Retail filings surged 24% from 237 in 2024 to 293 in 2025, according to data from The Gazette Official Public Record published by the government.

Greater London remained the region with the most business failures, with 390 administrations in 2025, compared with 393 in 2024.

Andy Taylor, partner and head of restructuring at Shakespeare Martineau, said: “The retail sector remains under significant pressure. Despite a slight easing of inflation and interest rates, consumers remain cautious and price-sensitive. Footfall continues to lag and many businesses have not been able to adapt to the new retail landscape.

“The drop in filings in hospitality, manufacturing, real estate and construction could be the result of earlier failures having already removed the weakest operators. It may also reflect a slowdown in activity, with firms putting investment and hiring decisions on hold due to continued uncertainty.”

Taylor added that with 1,631 filings being made, “we are still seeing more businesses enter administration than in 2021 and 2022, and distress remains widespread across multiple sectors and regions.”

A similar report from the Institute for Turnaround in November 2025 found real estate was one of the most distressed sectors in 2025 and recorded the largest percentage increase in businesses in distress over the year.