Worries over the health of the retail real estate sector and the future of traditional shopping centres started in the United States as failing retailers exposed an over-shopped market in light of an increase in e-commerce.

Those concerns have now become increasingly relevant for the European markets as uncertainty increases about future successful locations and retailers, as well as how to adapt to changing consumer behaviour because of e-commerce. This has been visible first in the United Kingdom as retailer bankruptcies and store closures have led to loss of rental income and low levels of liquidity in the retail investment market.

This sentiment is also being felt across continental Europe where more affordable rents are seen as providing some insulation, but there will still be an impact from e-commerce structural changes in the coming years.

ULI interviewed 24 members – including investors, developers, lenders, and valuers – to get their views on what underlying issues are creating this illiquidity and what might be the triggers to unlock the stasis in the market.

The research shows that the complex nature of the structural changes in the retail industry is resulting in the market being in limbo as buyers and sellers fail to agree on pricing.

(Available to ULI members only via Knowledge Finder)

About ULI Europe’s Retail and Entertainment Product Council 

The Retail and Entertainment Product Council is made up of senior executives who are full members of ULI in Europe. From shopping centres, high street shops, and out-of-town retail parks to restaurants, cinemas, and concert venues, ULI Europe’s Retail and Entertainment Product Council examines all aspects of ownership and operation in this sector. Through a programme of events and original content, the council draws ideas from both established best practices and emerging trends to provide members with insights into the retail and entertainment market.