Traditional bricks-and-mortar shopping continues to hold strong appeal for customers despite the continued growth of online retail, with retail parks emerging as an increasingly attractive destination for both retailers and consumers. With online retail having plateaued at just over 28% of UK retail sales, below its pandemic peak, physical stores remain firmly at the heart of how customers choose to spend their money. The question is no longer whether physical retail will survive, but how retailers and landlords are allocating space across different formats. Michaela Walker, a commercial property solicitor at national law firm Clarke Willmott, said: “The retail landscape has changed significantly, but reports of the death of physical retail have been greatly exaggerated. What we are seeing is a more nuanced evolution in the way retailers use physical space, with retail parks increasingly forming an important part of that picture. “Retail parks offer a combination of accessibility, convenience and flexibility that is particularly well suited to the way consumers shop today. For retailers, they can also provide larger units, easier access and opportunities to integrate traditional retail with click-and-collect, returns and other elements of an increasingly omnichannel customer journey.” The strength of demand for retail park space is reflected in current market data. British Land, one of the UK’s largest retail park owners, reports 99% occupancy across its 1,200-unit portfolio. Savills puts available floorspace across UK retail parks at just 1.8%, with 91% of existing occupiers choosing to renew rather than relocate. CBRE reported in 2025 that retail parks had the lowest vacancy rate of any major retail property sub-sector, alongside the strongest five-year rental growth across UK retail as a whole. Savills’ Johnny Rowland has described this as “a structural imbalance between supply and demand”, creating a “highly competitive environment, particularly for well-located schemes”. The shortage of space reflects a combination of limited land availability, high construction costs and challenging development appraisals, alongside the wider covenant strength of the sector. The profile of retailers occupying retail parks is also changing. The traditional image of retail parks as the preserve of DIY, furniture and automotive retailers no longer tells the full story. Food, fashion, homewares, leisure and value retailers are all expanding their presence in these locations. Home Bargains was the fastest-growing retail park tenant of 2025 according to Knight Frank, with 265 units. Aldi and Lidl now each operate more than 100 retail park sites, while Next, M&S and Skechers have pursued out-of-town strategies alongside their city-centre presence. This reflects what Savills describes as a more holistic approach to expansion, recognising the complementary role different retail formats can play in reaching different customer catchments. Michaela Walker said: “Retailers are increasingly looking at their estates as a portfolio rather than making an either-or choice between the high street, shopping centres and retail parks. Each format serves a different purpose, and the strongest strategies are often those that recognise how those locations can work together. “The appeal of retail parks is particularly clear for retailers whose customers value convenience. Easy road access, free parking and the ability to combine several shopping trips in one visit can be powerful advantages. At the same time, larger units can give retailers greater flexibility over how they operate their stores and integrate physical retail with their online offer.” The growth of retail parks should not, however, be interpreted as a story of high streets and shopping centres losing out. Strong demand for retail park space sits within a broader retail property market that continues to evolve across all formats. High streets, shopping centres and retail parks each serve distinct purposes within the customer journey, and retailers are increasingly using a combination of locations to reach different audiences. Michaela Walker said: “This isn’t the death of the high street. It is about retailers understanding where different types of physical space work best for their particular business and customers. “Retail parks are clearly experiencing strong demand at the moment, but that exists alongside continuing investment in town and city centres and shopping centres. The important point for retailers is to have a clear location strategy and to understand what each part of their estate is intended to achieve.” For retailers looking to expand, the strength of demand means that waiting for a suitable retail park unit to appear on the open market may no longer be an effective strategy. Space is often being absorbed before it becomes widely available, making early engagement with landlords and agents increasingly important. For developers, the supply gap presents an opportunity, although the planning process and development economics remain significant challenges, with applications taking nearly two years in some cases. Across the market, the 2026 business rates revaluation is also reshaping the cost equation for retailers operating across different formats, adding another factor to decisions around location and estate strategy. Michaela Walker said: “For occupiers, the message is to think ahead. If a retail park is an important part of your expansion strategy, it is worth engaging early rather than waiting for a unit to become publicly available. “Businesses also need to consider the wider costs of occupation, including rent, business rates and fit-out, alongside the operational benefits that a particular location can offer. With supply constrained and competition for good-quality space high, having a clear strategy can make a significant difference.” The next phase of physical retail is therefore likely to be less about choosing between physical and online channels and more about how retailers use physical space most effectively. For some, that will mean investing in flagship stores in town and city centres. For others, it will mean larger, more accessible and operationally efficient stores on retail parks. Michaela Walker concluded: “Physical retail remains incredibly relevant. What is changing is the role that individual stores and locations play within a retailer’s wider business. “The combination of retail parks, shopping centres and high streets is helping physical shopping remain vibrant and relevant. Retailers that understand how those different formats complement one another will be best placed to make
