Last week, our Growth and Performance Manager, Ben Hammond, attended the Leisure Property Forum‘s Annual Review of 2024 and What to Expect in 2025. These are his top takeaways from the event.
As we step into 2025, the retail and leisure sectors are navigating a landscape that is both challenging and ripe with opportunity. Shaped by economic trends, changing consumer behaviours, and a shifting political environment, the year ahead promises dynamic transformations. Here’s a closer look at the key insights and what they mean for businesses moving forward.
Cash Reserves Exceed Expectations
Contrary to predictions made before the pandemic, UK consumers have more cash in the bank than anticipated. In 2019, forecasts suggested there would be £1.84 trillion in bank accounts by this point. However, the actual figure is £1.93 trillion — a staggering £90 billion more. This surplus can largely be attributed to global uncertainty over recent years, including the pandemic, political turbulence, and ongoing conflicts. When faced with uncertainty, consumers often tighten their spending habits, prioritising savings and delaying discretionary purchases.
For businesses, this means there’s untapped spending potential waiting to be unlocked. With the right strategies, particularly in leisure and dining, brands can capitalise on these heightened reserves by offering compelling experiences that inspire consumers to loosen their purse strings.
A Stable Tax Environment
One piece of good news for 2025: significant tax increases from the government are highly unlikely. This provides a level of stability for both businesses and consumers, allowing more confidence in financial planning and investment. For brands, this stability could encourage expansion plans or refurbishments without the looming fear of unexpected fiscal policy changes.
Leisure and Dining Thrive
The demand for food and beverage (F&B) reached a peak in November 2024, and this momentum is expected to carry forward. Consumer spend on dining out is projected to outpace average spending growth across other categories, showcasing the enduring appeal of social dining experiences. From fine dining to street food markets, the F&B sector remains a cornerstone of consumer engagement.
Complementing this trend, the rise of big-box leisure operators is transforming vacant retail spaces into vibrant, high-footfall destinations. For instance, the new Flip Out at Lower Precinct in Coventry exemplifies how such operators breathe life into previously underutilised spaces. Their ability to attract diverse audiences makes them invaluable assets for shopping centres and retail parks.
Competitive Socialising: The New Anchor Tenants
Gone are the days when department stores were the sole anchors of retail schemes. Competitive socialising venues, such as bowling alleys, escape rooms, and interactive darts bars, are stepping into the spotlight. Acting as mini-anchors, these occupiers not only drive footfall but also encourage dwell time, benefiting surrounding businesses.
Health, Wellbeing, and Sports on the Rise
Health and wellbeing remain a priority for consumers, reflected in the expansion of gym chains like Pure Gym, which opened over 20 new locations in 2024 and plans to add 60+ more in 2025. The appetite for fitness is mirrored in the meteoric rise of paddle — the fastest-growing sport globally. With numerous new clubs set to launch, paddle continues to capture the imagination of health-conscious consumers.
These trends underscore a significant shift towards experiences that prioritise physical and mental wellbeing, presenting opportunities for businesses to align with this growing demand.
The Road Ahead
The economic environment of 2025 presents a wealth of opportunities for those ready to adapt and innovate. By leveraging the untapped spending power of consumers, embracing the rise of experiential retail and leisure, and aligning with health-conscious trends, businesses can position themselves to thrive in this evolving landscape.
The message is clear: success lies in rethinking traditional approaches and embracing the transformative power of change. Whether through creative use of retail spaces or tapping into the booming F&B and health markets, 2025 is poised to be a year of reinvention and growth.
If you’re looking to creatively activate your retail space and harness these trends, we’d love to help. Get in touch today to explore how we can collaborate and drive success in the year ahead.