The collapse of a takeover bid for the shopping centre landlord Intu is the latest sign of the reckoning being faced by bricks-and-mortar retailers as Britons abandon the high street.

A £2.9bn takeover of the Trafford Centre owner was called off on Thursday as uncertainty around Brexit compounded investor concerns about weak consumer confidence and changing shopping habits.

While economic uncertainty was officially to blame, the bidding consortium, which included the Intu shareholder Peel Group, may have been worried about catching a falling knife. There have been growing concerns that the property market has peaked with the asset manager Fidelity International warning large falls in retail property asset values could be on the horizon.

Its real estate investment director, Adrian Benedict, thinks the value of UK shopping centres, retail parks and high street stores could fall by 20 to 70%, depending on the nature and quality of the assets. “Bricks-and-mortar retailers are in a fight for survival,” he wrote in a note to investors.

“Online shopping is transforming retail but at a time when consumption is struggling and the role of consumption in growth is waning,” added Benedict. “The level of rents and amount of floor space are uneconomic for many bricks-and-mortar retailers.”

The crash in asset values reflects the need for substantial rent reductions, Fidelity said, suggesting cuts of 10-40% might be in order to make stores “sustainable and affordable for bricks-and-mortar retailers”. Any correction would signal bad news for the City institutions that invest billions of pounds in commercial property on behalf of savers and investors.

This year’s long list of high street failures, which includes House of Fraser, Evans Cycles, Maplin and Poundworld, has already depressed the share price of listed property firms such as the Bullring owner, Hammerson, and Intu, which enjoyed a brief honeymoon period when the consortium’s interest was confirmed in October.

Analysts have been concerned about the rising number of empty stores in UK towns and cities, with recent figures showing the number of shops, pubs and restaurants lying empty jumped by more than 4,400 in the first six months of this year.

Intu’s property values slumped 9% in the first nine months of this year, losing almost £300m in value between July and September alone. British Land, which owns the Meadowhall centre in Sheffield, recently reported a 4.5% decline in the value of its retail portfolio to £6.3bn for the six months to the end of September.

Intu’s chief executive, David Fischel, sought to soften the blow of a second suitor inside a year walking away (Hammerson withdrew its £3.4bn offer in April) by highlighting new lettings were running 7% above last year.

“If you have got quality shopping centres you are still OK,” said Fischel, adding there was a “clear distinction” between good and bad sites which perhaps had not been recognised by the market.

Benedict was less optimistic though, suggesting the retail sector’s troubles were “only just beginning”. “The focus has been on bricks-and-mortar retailers having to close stores or develop costly distribution networks for new internet channels … but the real story for real estate investors is their need to reduce rents.”

He added: “The [retail] sector’s unprecedented squeeze on profits will lead to a correction in rental income that will unseat retail real estate as the prized, safe asset it once was and lead to a significant adjustment in capital values in real estate portfolios.”