Retail is close to finding a floor in the UK, with continental Europe close behind it. In its 2021 Global Outlook report, PGIM Real Estate has said that retail’s sharp value adjustment could soon come to an end in the UK, leading to opportunities to invest in a stabilisation and eventual recovery. Nevertheless, the manager warns that this could still be a “risky play” for many, as there is too much retail space across the continent, meaning that some properties will end up becoming obsolete over the next few months and years.

The correction in retail values began in 2016, with a noteworthy drop in UK retail capital value growth when the share of online retail sales started to climb more quickly. Then in 2017, when that share surpassed 16 percent, valuations began to drop at a faster rate. The manager says that continental Europe is expected to reach 16 percent this year at some point.

“The shift to online spending means that there is too much retail sp