Investment in central London shops and leisure premises has reached £1.6 billion in the first six months of 2025, more than double the same period last year and already ahead of the total recorded for the whole of 2019, according to research by real estate adviser Savills.

The firm said the figure represents a 130 per cent year-on-year jump and sits 101 per cent above the ten-year first-half average. If current momentum continues, Savills expects investment to exceed £2 billion for the full year, the highest annual tally since 2018.

Investor interest has been strongest in the West End, where second-quarter deals matched the opening three months and lifted half-year volumes on the area’s prime retail streets to £495 million, up 19 per cent on 2024. A more benign debt market and rising occupier demand on Oxford Street were cited as key drivers.

“We are seeing a marked resurgence in investor appetite for central London retail, particularly in the West End,” said Charlie Stoneham, associate director in Savills’ central London investment team, pointing to the appeal of long, landlord-favourable leases and resilient footfall. He added that sovereign wealth funds and private-equity buyers were now “increasingly active”.

One transaction highlighting the shift in sentiment was the off-market purchase of 149-151 Oxford Street for £63 million by Chinese toy group Pop Mart, advised by Royal London Asset Management. Savills said it was the first owner-occupier acquisition on the famous shopping avenue since Ingka Investments, the vehicle behind Ikea, bought 214-218 Oxford Street four years ago.

Marie Hickey, director of research at Savills, noted that recent development work and the planned pedestrianisation of Oxford Street by 2028 were strengthening the street’s long-term prospects. “All of this is creating compelling investment opportunities that will underpin momentum into the second half of the year,” she said.

Market participants say the revival comes after several difficult years in which the pandemic, the growth of online retail and a glut of short-term candy stores dented confidence. The latest data suggest deep-pocketed investors now see value, taking advantage of lower pricing before tourist numbers fully recover.

Savills expects further deals to complete before December, helping volumes comfortably outstrip the £523 million transacted in 2024 and consolidating central London’s position as one of Europe’s most liquid retail markets.

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