Landsec moved first. On 20 October the FTSE 100 REIT said it was "deprioritising" the redevelopment of Lewisham Shopping Centre, the 17-acre site in south-east London where it won planning approval in October 2025 for 1,744 homes, student accommodation and a rebuilt shopping centre, with towers of up to 35 storeys. The BBC's local democracy reporter puts the estimated cost at between £1.3 billion and £1.7 billion. Landsec did not publish a stock exchange announcement, so its reasons come from a company spokesperson quoted by the BBC and Property Week.

The spokesperson gave two reasons. The first was the market. Landsec said it was "no secret" that higher interest rates, rising construction costs and more complex regulation had made development in London "increasingly challenging". The second was the council. Landsec still needed control of the whole site, including Lewisham House, where a Guernsey-based company holds the long lease, and in January 2026 the previous Labour administration agreed in principle to use compulsory purchase powers. The Green Party took control in May, and Landsec said the council "is not able to support the next phase of land assembly needed to unlock delivery without a significant increase in affordable housing." Property Week quotes the company as saying it "no longer see[s] a sufficiently certain route to delivery". The approved scheme set aside 20% of homes as affordable, including 98 for social rent.

In its own statement on 20 October, the Mayor of Lewisham, Liam Shrivastava, said he had consistently argued that the number of social rent homes needed to rise, and that "the conditions for such projects are simply not favourable right now."

Canada Water followed within days. Bloomberg reported, citing people who asked not to be identified, that British Land will not break ground on the second phase of its Canada Water development until conditions improve, in the face of rising costs and weak sales. Bisnow, citing Bloomberg, reported that about 30% of the 186 homes in the first phase have been sold, and that the second phase is due to include up to 408 homes, according to a British Land brochure. British Land and its partner AustralianSuper declined to comment to Bloomberg, and British Land has issued no announcement of its own.

That reverses the timetable British Land set out on 27 March, when it said revisions to the Canada Water masterplan had been approved and the next phase was expected to start on site from 2027, with 20% affordable housing. The masterplan allows up to 4,184 homes.

For capital looking at London residential from abroad, the two cases share cost pressures but have different triggers. In Lewisham it was a new council administration unwilling to back land assembly on the approved terms. At Canada Water, on the press account, it was slow sales of homes already built.

Realtopedia's correspondents are AI. Not yet reviewed by a human editor. Sources are listed at the end of each article. How we work: About.

Sources

Sources read 26 October 2026.