Splashing out almost half a billion pounds on a shopping centre in the North West could be described as a bold move.

ONE big opportunity: Landsec took its stake in Liverpool ONE to 92% in 2024 as it pivoted to investing in major shopping centres

But property giant Landsec isn’t just standing by the logic of the acquisition of Liverpool ONE in 2024 – it is already seeing the benefits.

“Our leasing performance has been ahead of expectations since we bought Liverpool ONE,” says Pablo Sueiras, head of retail and hospitality leasing at Landsec. “It has been ahead of estimated rental value, ahead of the expectations that we had in the business case. On every performance metric, we will be able to reference better-than-expected results at the end of the year.”

Landsec paid £455m upfront to majority owners Abu Dhabi Investment Authority and Grosvenor to acquire a 92% stake in Liverpool ONE. A further £35m payment was deferred for two years.

The centre, which opened in 2008, attracts more than 20 million visits a year, according to its website, and has over 170 stores, bars, restaurants and leisure outlets.

Sueiras says the shopping centre didn’t need much intervention. “We inherited a scheme with very, very strong fundamentals that is very much a strong example of the trend that the biggest and best schemes are just capturing more and more market share,” he adds.

Liverpool ONE’s leasing performance has been ahead of expectations
Pablo Sueiras, Landsec

Landsec’s belief in this dynamic is such that it now owns majority stakes in seven of the top 30 shopping centres in the UK, having invested heavily in recent years.

In 2023, the developer acquired the remaining half of Cardiff’s St David’s shopping centre that it didn’t already own, while a year later it took its 49% holding in Bluewater in Essex to 66% with a £120m payment to GIC.

This expansion in the sector was made despite the physical stores facing a difficult few years. Last month, the British Retail Consortium (BRC) published figures showing footfall across the retail sector fell 0.8% in 2025 compared with 2024, while footfall at shopping centres was down 5.1% year on year in December, the crucial Christmas trading period.

Meanwhile, the Office for National Statistics says shopping spending remained below pre-Covid levels last autumn, with online spending growing to 32.4% of all activity in November 2025, the highest it has been outside the pandemic-affected years of 2020 and 2021.

Mersey mission: the local authority is leading the regeneration of The Strand mall in Bootle

But Sueiras’s faith in physical retail remains unbowed. “With the advent of artificial intelligence [AI] and generative AI, there will be dramatic and huge evolution,” he says. “We monitor that very closely – and we still believe in the value of the physical experience, if it is an entertaining, fun, rewarding one.”

He insists that with the right mix of occupiers across the retail, leisure and food and drink sectors, “you can create a multifaceted, interesting proposition that will sustain growth and performance well into the future”.

It isn’t only the biggest, boldest malls that are attracting interest. Less than five miles along the north bank of the River Mersey from Liverpool ONE, a very different shopping centre investment is being made. Avison Young is acting as a strategic partner to Sefton Council on the regeneration of struggling shopping centre The Strand in Bootle, which the local authority bought in 2017.

The scheme is backed by a £20m grant from central government and further support from the Liverpool City Region Combined Authority. Avison Young was appointed in September 2021 and helped achieve planning consent for the overhaul last year.

Stephen Cowperthwaite, managing director for the UK regions at Avison Young, says The Strand “was going backwards and needed intervention”. He adds that as a publicly funded project, the revamp must not just consider retail or even property performance metrics. “Could you start to look at it in terms of having a positive impact on health and wellbeing, for instance, or pride in the community, ambition, housing delivery?” he suggests.

Demolition of the centre began last summer, opening up the site to the Leeds and Liverpool Canal, which runs alongside it, to create opportunities for new food and drink outlets.

Being in a space, trying things on, meeting friends – it’s more satisfying than another hour on a screen
Hannah McNamara, P-Three

A town square will be built in this first phase, as will improved transport links, modern retail and leisure units, business space and community and cultural facilities.

Avison Young hasn’t ruled out attracting private investment at a later stage of the project. “It is a multi-year, multi-phase vision,” says Cowperthwaite. “We’re just starting the conversation with the council in terms of the delivery of the future phases.”

He predicts an increase in redevelopment of struggling in-town shopping centres. “There are a lot of instances where this kind of regeneration is starting to happen and a significant amount of opportunities are to come. You’ve seen yields of up to 20% [for such schemes]. An investor will think it can stabilise the assets, make some investments and bring some different occupiers in.

“You’ve got local authorities taking ownership of shopping centres in town centres as they realise the negative impact if things are going in the wrong direction.”

Retail recovery

Data from agency Savills shows a 2.4% increase in headline retail rents across shopping centres and high streets in Q3 2025. Mall vacancy levels fell by more than a percentage point year on year, while footfall increased by a similar margin – small but significant steps in a retail recovery.

Savills notes “strong investor appetite, resilient pricing and improving occupational fundamentals” for the sector, with deal volumes totalling £874.5m in the first nine months of last year.

Mark Garmon-Jones, Savills’ director of UK investment, believes the sector has emerged from a challenging decade in leaner shape. “We’re now in a position where a lot of the rebasing of rents has happened,” he says.

Cutting edge: leisure experiences such as axe-throwing are broadening shopping centres’ appeal

“And the fit-for-purpose retailers have upped their game.”

Savills recently tipped shopping centres as one of the best property sectors for investor returns over the second half of this decade.

Hannah McNamara, co-founder of P-Three, a consultancy that specialises in creating mixed-use destinations, says one reason for the resurgence is consumers preferring the in-store experience. “After years of scrolling and returning clothes that look nothing like they did online, shoppers are rediscovering the simple pleasure of seeing things in real life,” she says. “Being in a space, trying things on, meeting friends – it’s just more satisfying than another hour on a screen.”

She adds that the best-performing centres are the ones that offer food, leisure, wellness and social spaces in addition to traditional retail. “People don’t just come to buy something; they come to spend time,” McNamara says.

Sam Arrowsmith, director of commercial research at Savills, predicts a wave of repositioning of shopping centres. “We are seeing NHS diagnostic centres coming in. We’re seeing councils having more involvement with taking space for their communities. We’ve seen axe-throwing, bowling, cinema and all that kind of stuff; the all-round offer is there.”

Garmon-Jones expects a breadth of investor interest in high-performing shopping centres. “The ones that have the right strategy and have been invested in correctly are set strongly for growth,” he says. “And that’s why we are seeing more institutional demand.

“A lot of that is coming from the REITs or existing shareholders in a scheme upping their stake. But we’re also expecting to see more institutional demand from those who probably wanted to buy retail warehousing [for example] but think they might actually go and get a shopping centre.”

Students drive change of course at Merrion Centre

The 1m sq ft Merrion Centre in Leeds attracted nine million visits in 2024 – but owner Town Centre Securities (TCS) has innovative plans to increase that.

Associate director Charles Newman says the mall has been resilient and rents have stabilised. But he adds that the world is ever-changing.

“Like any property owner, you’ve got to remain versatile,” he says. “It remains a challenging economic landscape. But the biggest change we’ve seen has been to the physical landscape.”

Several student blocks including Olympian’s under-construction, 633-bed, 45-storey Arena Point are emerging around the shopping centre, altering the dynamic of its customer base and giving its owners some ideas.

“We recently secured planning for our own student development, the first residential space in the Merrion Estate’s history,” says Newman.

This will involve the conversion of a 13-storey office building and the creation of a 37-storey tower in a move TCS hopes will benefit both retailers and students.

“For us, it will be game-changing; we’ll have more than 1,000 student beds accessed via the internal shopping centre. So that enhances our capability and reinforces footfall.

“For students, there are the advantages of accessing their buildings through a covered environment that’s got 24-hour security, cleaners, shops on their doorstep and a Morrisons supermarket.”