Contents

• Resilient consumers, firmer occupational fundamentals

• UK shopping centre investment

• UK high street investment

Resilient consumers, firmer occupational fundamentals

Macroeconomic backdrop: Inflation eases, but risks remain

The UK retail investment market enters the second half of 2026 against a reshaped macroeconomic and political backdrop. Headline CPI inflation eased to 2.6% in June, down from 2.8% in May and below consensus expectations, helped by softer fuel, food and clothing prices. However, this is widely viewed as a temporary reprieve. Core inflation is unchanged at 2.6%, and services inflation has eased only marginally to 3.6% (from 3.7% in May) – a fuel-led headline dip sitting on still-sticky domestic price pressure. The National Institute of Economic and Social Research and the Bank of England (BoE) both expect headline CPI to reaccelerate in the second half of the year as the July energy price cap rise (+13%) and renewed Middle East volatility feed through.

Against this, the BoE has held Bank Rate at 3.75% for a fourth consecutive meeting, with the June vote splitting 7:2 in favour of a hold and two members voting for a hike to 4.00% – a more hawkish split than April's 8:1 and one that has all but removed the prospect of near-term cuts, reinforcing a "higher for longer" outlook for real estate financing costs.

Consumer spending holds up despite weak confidence

The consumer picture is more nuanced than the headline data suggests. Barclays UK Consumer Spend Report recorded a 1.9% year-on-year (YoY) increase in card spending in June – the strongest reading of 2026 so far, up from 0.8% in May – with essential spend rising 2.2% (a 14-month high, boosted by a 14.1% jump in fuel) and non-essential spend up 1.7%, driven by the record June heatwave and the start of the FIFA World Cup.

ONS retail sales volumes similarly rebounded, rising 1.2% month on month in May, the strongest monthly performance in four months. However, in-store non-food sales continued to decline in June (-1.1%), with online non-food up 5.1% and taking a 39.0% share of non-food spend – its highest of the year – as the heat pulled shoppers back to digital channels.

Consumer confidence, meanwhile, has stalled rather than recovered, with the GfK/NIQ Index unchanged at -23 in June and no demographic group – including higher-income households – now recording a positive score.

Geopolitical risks re-emerge

The expected reacceleration in CPI through H2 – which the BoE now sees peaking a little over 3.25% in Q4 – is driven principally by the pass-through of higher global energy prices tied to the ongoing conflict between the United States, Israel and Iran, which began in late February 2026 and has now escalated to sustained US strikes on Iranian targets. Following the collapse of the interim ceasefire, the Strait of Hormuz – through which around 20% of global seaborne oil and LNG typically flows – is once again effectively closed to commercial shipping, with Brent crude pushing back above $90 a barrel.

Flows through the Strait fell almost 30% YoY in Q1 2026 according to U.S. Energy Information Administration (EIA) data, and while a brief reopening in April/May supported the recent easing in inflation, renewed hostilities are already feeding back into higher fuel and energy prices, with the BoE warning that these knock-on effects could contain the pace of any future rate cuts. For UK real estate, the transmission mechanism is well understood: elevated energy prices support inflation persistence, keep benchmark gilt yields higher, and prolong pricing pressure across commercial property – most acutely for assets with refinancing exposure or heavier capital expenditure requirements.

A new political landscape

Domestically, the political backdrop has also been reset. Andy Burnham was appointed the UK's seventh Prime Minister in a decade on 20 July 2026, with John Healey's surprise appointment as Chancellor and a decisively new-look Cabinet signalling a more interventionist economic platform focused on the cost of living, decentralisation and greater public ownership of essential services. Early policy measures include a winter VAT cut on electricity bills and a £2 cap on bus fares, with anticipated action on business rates, employment rights and energy costs – all of which will be closely watched by retail occupiers and landlords.

For the shopping centre and high street investment market, this combination of a fragile global backdrop, sticky inflation, higher-for-longer interest rates and a new government with a distinctly different economic emphasis will shape pricing, liquidity and occupier decisions through the remainder of 2026.

Occupational market: Fundamentals remain resilient despite footfall volatility

Weather distorts Q2 footfall

Against this backdrop, underlying occupational market performance has remained more resilient than headline footfall data might initially suggest. MRI data shows average weekly footfall fell YoY across both high streets (-2.5%) and shopping centres (-0.75%) during Q2 2026. However, these declines were heavily influenced by exceptional weather conditions rather than a deterioration in retailer demand. June was the warmest on record for England and the second warmest for the UK as a whole, with temperatures reaching the high 30s in parts of the country during the mid-month heatwave. On the peak day of 24 June, high street visits fell by 9.4% week-on-week and 12.5% YoY as schools closed, consumers altered shopping habits and transport networks experienced disruption.

The performance divergence between locations was particularly notable. High streets were disproportionately affected by the extreme temperatures, while enclosed and air-conditioned retail environments proved more resilient. Shopping centres benefited from their managed environment, and retail parks were the only retail destination type to record positive footfall growth during the quarter. Indeed, the unusually warm weather had begun influencing consumer behaviour earlier in the period. May's prolonged spell of sunshine supported retail park visitation through stronger spending on grocery, DIY, garden and outdoor living categories, while simultaneously drawing some consumers away from traditional town-centre discretionary shopping trips.

Shopping centre vacancy tightens after Q1 wobble

Importantly, leasing fundamentals continue to improve despite short-term volatility in footfall trends. Shopping centre vacancy increased from 16.3% in Q4 2025 to 16.9% in Q1 2026, reflecting a temporary softening in occupational conditions driven by a seasonal wave of administrations, well-publicised restructuring activity and a sharp deterioration in consumer sentiment following the escalation of geopolitical tensions in the Middle East. However, this proved short-lived. By Q2, shopping centre vacancy had fallen 80 bps to 16.1% – the sharpest quarterly improvement since Q1 2016 – moving beyond the level recorded at the end of 2025.

Several factors have supported this recovery. Geopolitical concerns moderated during much of the quarter, allowing occupiers to progress previously deferred leasing decisions, while supply constraints in the retail warehouse market have increasingly redirected requirements towards dominant regional and super-regional shopping centres. With retail warehouse vacancy remaining close to historic lows, a growing number of retailers are broadening search parameters to include prime shopping centre accommodation.

At the same time, secondary shopping centre space continues to be repurposed for alternative uses including leisure, healthcare and residential, reducing structural vacancy and improving the quality of remaining retail stock. The significant increase in shopping centre investment activity over the past year has also brought fresh capital into the sector, supporting asset management initiatives, active leasing strategies and enhanced occupier engagement.

Rental performance is following a similar pattern of underlying resilience with some near-term softening. Savills analysis of open-market lettings and regears shows average headline and net effective rents in Q2 2026 grew 2.3% and 2.5% YoY, respectively, with net effective growth continuing to run marginally ahead of headline – consistent with a market where landlords are protecting tone through incentives rather than conceding on face rents. On a rolling four-quarter basis, however, headline and net effective rents softened 6.2% and 6.8%, respectively, versus Q1 2026, reflecting the drag from Q1's weaker leasing environment and a more measured stance on rental growth as occupiers rebuild confidence. Taken alongside the sharp Q2 vacancy improvement, the direction of travel on rents remains supportive – but the pace of growth is moderating rather than accelerating.

High streets continue to rebalance

High street performance has remained comparatively stable. Vacancy continued its gradual downward trend during Q1 2026, falling from 13.4% to 13.2%, where it remained through Q2. While footfall has been more susceptible to both weather disruption and ongoing shifts in consumer behaviour, the vacancy data points to a continued rebalancing of supply and demand. Many locations have benefited from the ongoing diversification of occupier mix, with food and beverage, health and wellbeing, convenience retail and service-led operators continuing to absorb available space. As a result, occupational conditions across both shopping centres and high streets remain considerably healthier than headline footfall statistics alone might suggest, providing a solid foundation for investment activity through the second half of the year.

Key consumer & occupational takeaways

• Consumer spending held up in June despite weak sentiment. Barclays card spend rose 1.9% YoY – the strongest print of 2026 so far – and ONS retail sales volumes rebounded 1.2% month on month in May. GfK/NIQ consumer confidence, however, remained pinned at -23, with no demographic group recording a positive score.

• The heatwave reshaped, rather than reduced, spend. Non-essential spend was supported by the record June temperatures and the FIFA World Cup, but in-store non-food fell 1.1% as online non-food captured a record 39.0% share of non-food spend.

• Q2 footfall declines were weather-driven, not demand-driven. MRI data shows high street footfall down 2.5% and shopping centres down 0.75% YoY, but the peak heatwave day of 24 June alone saw high street visits fall 12.5% as schools closed and transport networks were disrupted.

• Shopping centre vacancy has tightened sharply. Vacancy fell 80 bps to 16.1% in Q2 – the sharpest quarterly improvement since Q1 2016 – reversing the Q1 uptick to 16.9% and moving beyond the Q4 2025 level, reflecting the release of leasing decisions deferred during the Q1 geopolitical spike, retail warehouse demand spilling into prime shopping centres, and continued repurposing of secondary space to alternative uses.

• Rents are resilient YoY but softening sequentially. Savills analysis of open-market lettings and regears shows headline and net effective rents up 2.3% and 2.5% YoY in Q2, but down 6.2% and 6.8%, respectively, on a rolling four-quarter basis versus Q1 – with net effective ahead of headline, consistent with landlords defending tone through incentives.

• High streets continue to rebalance quietly. Vacancy held at 13.2% through Q2, extending the gradual downward trend as F&B, health and wellbeing, convenience and service-led operators absorb available space.

• Bottom line for investors: occupational fundamentals are materially healthier than headline footfall suggests, providing a solid underpin for investment activity into H2.

UK shopping centre investment: Quiet quarter, deeper pipeline

H1 volumes: Concentrated activity, deeper pipeline

The UK shopping centre investment market delivered £503 million of transactions across 10 deals in H1 2026, with Q2 contributing just £85 million from four transactions. On the face of it, that represents a 79.7% quarter-on-quarter fall and an 80.0% decline on Q2 2025, leaving H1 volumes materially below the ten-year average. However, the headline understates the underlying position. Merry Hill (£291.5 million) and The Broadway, Bradford (£70 million) together accounted for c. 72% of H1 volumes, consistent with the pattern seen throughout the current cycle whereby a small number of large lot sizes drive the majority of capital deployed.

Contrary to the prevailing narrative of a market starved of product, activity is running more quietly than the transacted figures suggest – and the pipeline has moved decisively in recent weeks. Twelve schemes were under offer at the end of Q2, representing a combined capital value of around £305 million.

Since quarter-end, that picture has shifted materially: the Gateshead Metrocentre (c.£500 million) and a 50% stake in Manchester Arndale (c.£220 million) have both moved under offer, adding some £725 million to the under-offer total and lifting it comfortably beyond £1 billion. A further 20 centres remain actively in the market with a combined quoting value of around £330 million.

Taken together, that represents approximately £1.4 billion of shopping centre stock either under offer or actively being marketed. Processes are being run in a more controlled, disciplined manner than in previous cycles, with vendors and advisers preferring measured off-market or selectively targeted approaches over broad public launches – but the conversion of two of the sector's largest opportunities points to a materially more active second half.

Metrocentre: The defining benchmark

Metrocentre will define H2 – and it is now moving. Formally launched in May at an indicative capital value in excess of £500 million and a quoting net initial yield of 8.15%, the process attracted a deep and varied field spanning global private equity, institutional and REIT capital before moving under offer in late July, with a listed UK REIT entering exclusive talks in excess of the £500 million guide.

Metrocentre is a materially larger and more complex opportunity than Merry Hill, with an active £30–£50 million capital expenditure programme forming part of the ongoing repositioning strategy following the recent £6 million refurbishment and the creation of the 10,000 sq ft 'The Crescent' hub. The fact that a REIT – rather than opportunistic private equity – has emerged as preferred bidder is a powerful signal of confidence in prime, dominant stock, and investors appear undeterred by the outstanding capex requirement, provided asset quality and the underlying business plan support the investment case.

The transaction is set to prove one of the most significant pricing benchmarks the sector has seen in recent years. With a preferred bidder now selected, it is already beginning to answer whether institutional capital will deploy at scale in the current debt environment – and, on completion, will test whether prime shopping centre yields have further compression to run.

A successful close would supply the evidence base the market has been missing and could unlock a broader repricing of dominant schemes.

Other deals and emerging opportunities

Beyond Metrocentre, activity is broadening. M&G Real Estate launched the sale of The Friary in Guildford in May, quoting c. £40 million at a net initial yield of around 10.0%. The asset requires capital investment, but Guildford's affluent catchment, strong comparison offer and limited direct competition have attracted a competitive field of credible bidders, further evidence that pricing, rather than demand, is the primary determinant of transactability. M&G's involvement in the wider North Street regeneration scheme may also influence its capital allocation approach across the town.

The prime end of the market has also moved. A 50% stake in Manchester Arndale - one of the UK's prime city-centre schemes at 1.96 million sq ft and 98% let – has been agreed to a listed REIT for c. £220 million, having been brought to market by the former Intu revolving credit facility investors, with M&G Real Estate retaining the other half. A REIT securing a prime city-centre stake at this scale is a further marker of institutional conviction returning to the top of the market and sits alongside Metrocentre as a defining H2 benchmark.

Lot sizes: The return of institutional capital

Large lot sizes are increasingly dominating headline volumes. In 2016, £100 million-plus transactions accounted for 71% of activity. By 2023 – the low point of the last cycle – the market had fragmented, with volumes dispersed across all lot sizes as institutional capital retreated and price discovery played out. The recovery has been swift and concentrated: £100 million-plus transactions represented 70% of volume in 2024 and 73% in 2025, almost exactly mirroring 2016 and signalling the decisive return of institutional and overseas capital to the sector.

The pattern continues in 2026. While 50% of deals so far (five in total) have been below £25 million, they represent just £40 million of the £503 million transacted. The pricing gap between prime and average is also closing – a hallmark of a market in recovery – with prime yields and capital values psf converging back towards the wider market after the sharp divergence of 2019–2023.

Debt markets running ahead of capital markets

The debt market continues to sit ahead of the capital market and remains the single most important supportive factor for the sector. Lender appetite is robust, with both senior banks and credit funds actively deploying, and recent bond issuance at tight pricing reinforcing a positive credit outlook. Competition among lenders is compressing margins on the best assets, with sponsors increasingly running processes across 30–60 lenders to secure optimal terms. Structure, rather than pricing, has become the primary differentiator.

Larger lot sizes attract better debt terms and greater lender interest, with lenders typically preferring to write £50 million-plus tickets over the £10–£15 million range. This dynamic is helping to reinforce the concentration of activity at the top end of the market. Selectivity remains high, however, with pricing dispersion widening according to location, occupancy risk and sponsor quality. Where debt is accretive – as it is on well-located dominant schemes – it is supporting both pricing and deliverability.

Pricing and yields

Savills equivalent yields remain unchanged for a fourth consecutive quarter at 7.25% for Super Prime, 9.00% for Prime and 10.50% for Town Centre Dominant assets. While pricing sentiment has softened marginally on individual transactions, with buyers seeking to renegotiate at the margins, this reflects opportunistic behaviour rather than any fundamental repricing driven by debt costs or capital availability. Yield movements remain highly asset-specific, with the market continuing to differentiate sharply between dominant schemes and weaker secondary stock. The market is now in a period of price discovery, and the next phase of pricing is likely to hinge on the evidence provided by major shopping centre transactions currently under offer. Nevertheless, the improving occupational backdrop, scarcity of best-in-class assets and continued depth of investor demand suggest any outward pressure on prime shopping centre yields should remain limited.

Outlook: On track, driven by quality not quantity

Despite a subdued Q2, Savills continues to forecast £1.5–£2.0 billion of shopping centre transactions in 2026, with the potential to exceed this figure if the largest processes complete to timetable. With the Metrocentre and the Manchester Arndale stake both moving under offer since quarter-end, that pipeline is already beginning to convert. With a handful of the UK's top 30 shopping centres still expected to transact or come to market over the remainder of 2026–2027, and a significant number of assets or stake interests having already traded or entered the market since 2022, the sector is undergoing a clear structural change in ownership as a new generation of institutional, private equity and overseas capital re-establishes positions.

To recap the three pillars underpinning our constructive view: first, occupational fundamentals have stabilised – vacancy has fallen back below its Q4 2025 level, prime schemes are approaching full occupancy, and spillover demand from a supply-starved retail warehouse market is directly benefiting dominant centres. Second, debt is available, competitive and accretive on quality stock. Third, sentiment is measurably better than at the start of the year, with new capital entering the sector and retail firmly back on institutional agendas.

The risks are more about timing than direction. A new Prime Minister and Cabinet, seven changes of government in a decade, ongoing volatility in the Middle East and continued caution among vendors on aspirational pricing will all influence the pace at which product reaches the market. Andy Burnham's stated intent to reform business rates could offer meaningful support to retail occupiers and, by extension, landlord income, but the detail and delivery timeline remain uncertain.

For well-capitalised owners, refinancing is increasingly being considered alongside disposal, providing greater optionality on execution. For buyers, the window to secure high-quality assets ahead of the next leg of yield compression is narrowing. Expect a quieter summer, followed by a familiar pattern: an active Q4 driven by a small number of large, well-prepared processes landing before year-end. On current pipeline, 2026 volumes remain firmly on track – and, as ever in this cycle, will be defined by the quality and scale of the assets that trade, rather than the number of deals done.

Key shopping centre investment takeaways

• Headline H1 volumes understate underlying activity. £503 million transacted across 10 deals in H1, with Q2 contributing just £85 milion – but the pipeline has since moved decisively: the Metrocentre (c. £500 million) and a 50% stake in Manchester Arndale (c. £220 million) have both moved under offer since quarter-end, lifting the total under offer to well over £1bn and pointing to a materially more active second half.

• Pricing, not demand, is the primary determinant of transactability. The Friary in Guildford (c. £40 million at c. 10.0% NIY) has drawn a competitive field of credible bidders despite a capex requirement, underlining that well-located stock will transact wherever pricing reflects the asset management angle rather than any absence of buyer appetite.

• Debt is running ahead of equity and remains the single most important supportive factor. Senior banks and credit funds are actively deploying, sponsors are running processes across 30–60 lenders, and structure – rather than pricing – has become the primary differentiator. Larger lot sizes attract materially better terms, reinforcing concentration at the top of the market.

• Yields are unchanged for a fourth consecutive quarter at 7.25% Super Prime, 9.00% Prime and 10.50% Town Centre Dominant. Pricing sentiment has softened modestly and yield movements are becoming increasingly asset-specific, with the next phase of pricing likely to hinge on evidence from major transactions currently under offer.

• The sector is undergoing a structural change in ownership. With a handful of the UK's top 30 shopping centres still expected to transact or come to market over the remainder of 2026–2027, and a significant number of assets or stake interests having already traded or entered the market since 2022, a new generation of institutional, private equity and overseas capital is re-establishing positions.

• Bottom line for investors: Savills continues to forecast £1.5–£2.0 billion of transactions in 2026, with upside if the largest processes complete to timetable. Risks are about timing rather than direction – and for buyers, the window to secure high-quality assets ahead of the next leg of yield compression is narrowing.

UK high street investment: Ready capital, conditional timing

Q2 delivers the trading window we flagged

In our Q1 commentary, we suggested a Q2 trading window was likely to open. It did, and pricing has remained broadly stable through the quarter. MSCI RCA data now records £313.8 million of urban retail and high street transactions in Q1 (up from the £155.2 million initially reported, as further deals were confirmed), with a further £224.2 million captured in Q2 to date. That takes H1 volumes to £538 million, 60.3% below H1 2025, but the headline requires context: 2025 was itself an unusual year, with a pronounced Q3 dip followed by a sharp Q4 recovery. Market activity has been constrained far more by stock availability than by any weakening of investor appetite.

Encouragingly, that stock constraint has begun to ease. The back end of Q2 saw a meaningful pick-up in launches – later in the cycle than we would typically expect, but a positive signal for Q3. Investors have taken the view that the current geopolitical and macroeconomic backdrop is unlikely to improve materially in the near term, and are increasingly prepared to transact on that basis. "If you're a seller, you're a seller" captures the tone.

A more diverse buyer pool than any other retail sub-sector

High streets currently offer one of the broadest capital diversity of any UK retail sub-sector – a structural point that has become more visible through 2026. Private investors have accounted for 61.0% of purchases so far this year, up from around 23% in 2025 and reflecting a buyer base that is materially less exposed to institutional investment committee (IC) cycles than the shopping centre or retail warehouse markets. Cross-border capital contributes a further 22.8%, with institutional buyers at 16.2% – a marked shift from 2025, when cross-border activity dominated at 54.1%.

The buyer pool is also structurally differentiated across the market. Larger vanilla assets are attracting institutional and cross-border interest; higher-yielding, more asset-management-intensive stock is finding a home with opportunistic and value-add capital; and prime is being pursued by a distinct group of long-hold private and family office buyers. French SCPIs (Sociétés Civiles de Placement Immobilier) – non-listed vehicles that pool retail investor capital in a syndicated structure – remain an important contributor to liquidity in the £3–£10 million bracket, filling a gap that would otherwise sit awkwardly between institutional and private demand.

The unifying feature across the buyer pool is a preference for income today over the promise of income and growth tomorrow. High streets currently offer that combination better than most alternatives, and it is this income characteristic, rather than any expectation of near-term capital growth, that is underpinning demand.

Sources of supply: institutional reshaping, not retreat

Where will stock come from if buyer demand continues to strengthen? Institutional vendors remain the principal source, consistent with the pattern of recent years. The core point is that disposals are being driven by fund dynamics rather than by any negative view on the high street sector. Defined benefit pension scheme restructuring continues to generate flow, with smaller segregated mandates being either sold down or absorbed through mergers – often leaving behind lot sizes that no longer fit the strategic profile of the enlarged funds. At the same time, many institutional owners are content to hold, with income returns remaining attractive and no overarching "sell the high street" narrative in play.

Supply is therefore being released in a gradual and orderly manner, which is itself a stabilising force on pricing.

This institutional reshaping is also shaping the size profile of tradable stock. As funds grow larger and more cash-rich, appetite skews away from smaller transactions – meaning sub-£20 million lots are more likely to reach the market, while £20 million-plus opportunities increasingly sit on the institutional wish list. Early signs of a return of institutional demand are emerging following a 14.7% share of purchases in 2025, although this has yet to translate meaningfully into recorded buying activity in 2026 year-to-date.

The seller mix has also shifted. In 2025, institutional investors were the largest sellers (38.4%), ahead of cross-border (24.1%) and REIT/listed entities (19.4%). In H1 2026, cross-border sellers have led at 36.2%, followed by REITs (30.9%), institutions (17.5%) and private vendors (11.7%) – a rotation that is helping to broaden the range of stock available to the diverse buyer pool described above.

Occupational fundamentals: better than the headlines suggest

The occupational narrative in the press has turned more negative through Q2, with renewed commentary on restructurings and the return of the CVA. The reality is more nuanced. Rental growth on high streets has continued, and the more high-profile occupier difficulties – most notably TG Jones – reflect the usual churn of retailers that have not modified their store estates or evolved their propositions in line with the market, rather than any fundamental weakening of the underlying sector. If anything, well-capitalised buyers are treating the current occupational noise as a positioning opportunity, acquiring stock into what they view as a structurally healthier market than the headlines suggest.

Pricing and yields: stability with pockets of pressure

Prime high street yields remain at 6.50%, unchanged since summer 2024. The previous downward pressure has eased for the time being, but there is no evidence of a material outward shift. Pricing stability is the defining feature of the current market, underpinned by a buyer base that is less sensitive to investment committee cycles and by an ongoing shortage of best-in-class stock. Pockets of pricing pressure will emerge – typically at larger lot sizes where the buyer pool narrows - but the predominantly private nature of demand at the smaller end of the market is providing a natural buffer against the sentiment wobbles that have moved pricing in more institutionally-owned sub-sectors.

Key high street investment takeaways

• The Q2 trading window we flagged in Q1 materialised. H1 volumes reached £538 million (MSCI RCA) – 60.3% below H1 2025, but the shortfall reflects stock constraints rather than any weakening in investor appetite, with launches picking up at the back end of Q2 to set up a stronger Q3.

• High streets offer the broadest buyer pool of any UK retail subsector. Private investors account for 61.0% of purchases so far in 2026 (up from c. 23% in 2025), a fundamentally less IC-sensitive base than other retail markets that is helping to underpin pricing stability.

• Institutional supply is being released in an orderly, non-forced manner. Disposals are driven by fund dynamics rather than any negative view on the sector, with sub-£20 million lots reaching the market and £20 million-plus opportunities increasingly on the institutional wish list.

• Occupational fundamentals are healthier than the headlines suggest. Rental growth has continued through 2026, with the more high-profile occupier difficulties reflecting the usual churn of retailers that have failed to evolve rather than any weakening of the sector.

• Prime yields remain at 6.50%, unchanged since summer 2024. Downward pressure has eased with no evidence of a material outward shift, leaving high streets delivering what investors want – stable pricing, income-led returns and a diverse buyer pool. The market is poised rather than paused.

Outlook: A stronger H2 in prospect

The high street investment market enters H2 in a stronger position than the H1 volume figures alone suggest. Stock availability has improved, pricing is stable, and the buyer pool is both broader and more resilient to macro and geopolitical shocks than in some other UK retail sub-sectors. Q3 is set up well: the deals launched in the back end of Q2 should feed through into recorded volumes over the coming months, and there is a credible path to a materially stronger H2 print.

A further supportive dynamic could come from vendors seeking to exit ahead of the next shock event – a mindset shaped by several years of repeated disruption (Ukraine, National Insurance and minimum wage changes, fiscal adjustments, business rates reform and tariff-related uncertainty). Where pricing is perceived as stable and execution risk is manageable, capital tends to move quickly, and this opportunistic behaviour is likely to reinforce the Q3 pipeline rather than delay it.

The risks, as with the shopping centre market, are more about timing than direction. A new government, ongoing Middle East volatility and the pace at which institutional vendors release stock will all influence transaction throughput. Andy Burnham's stated intent to reform business rates could offer meaningful support to occupier income and, by extension, high street investment values – but the detail and timeline remain uncertain.

On current evidence, the high street sector is delivering exactly what a broader group of investors is currently looking for: stable pricing, income-led returns, a diverse and less IC-sensitive buyer pool, and an occupational base that is more resilient than the headlines allow. The market is poised rather than paused – and near-term outcomes will be shaped by political clarity and vendor confidence rather than by any weakness in underlying demand.

Further reading

>> Read our latest Spotlight: UK Leisure – 2026 here

>> Read our latest Lucky Seven: Retail & Leisure Occupational Trends 2026 here

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