Casual dining has increased by 11.6% (2009-2014), while traditional restaurants have declined 11.4% in the same period (NPD Group). With so many small chains appearing in the UK, defining casual dining is not straightforward and is difficult to monitor in such a fast paced sector. We tend to view it as brands that:

■ Have 2+ locations

■ Located in city centres, leisure schemes and in affluent market towns

■ Doesn’t include pub chains, more formal dining options, or independents.

The casual dining sector remains dominated by long established brands, such as Pizza Express, Nando’s and Frankie and Benny’s. In fact, eight brands with more than 100 restaurants in their portfolios represent 44% of all casual dining restaurants from portfolios that were already mature pre-downturn. Yet almost 80% of the market is made up of brands with fewer than 25 restaurants and it is this area that has seen the starkest growth in the last few years. Small chains have increased by 39% in the last three years, versus large chains increasing by 13%.

The increased choice and range has been driven by a surge of investment in the leisure sector at a time when retail continues to have lack lustre growth; 7 out of 10 of the most frequently visited restaurant brands in the UK are Private Equity owned.

Private Equity demands growth through store openings and it is easier to find this growth from smaller portfolios. Hence Franco Manca has doubled its portfolio in 12 months to over 20 locations and Côte have increased their portfolio by 50% to over 70 restaurants in under two years.

New developments in some of the largest UK cities (Grand Central, Birmingham; Corn Exchange Manchester) have highlighted the importance of casual dining at the heart of their retail and leisure offer. However, new restaurant pitches are also becoming more prevalent (Hanover St, Liverpool; Charlotte Street, London), with pitch clearly being a key factor in a restaurant’s success. These developments and ‘quarters’ provide an opportunity for some of the smaller brands, like Wahaca, Busaba and Pho, to get a foothold as a national chain.

^{▲ Corn Exchange, Manchester}

^{Source: Savills Research}

^{Source: Savills Research/CGA Outlet Index}

The UK restaurant market is undergoing a cultural shift in the kinds of food and experience that consumers seek when dining out.

Italian and pizza remain the most numerous and popular of all casual dining cuisines; their combined offer accounting for 45% of all branded restaurants. However, 80% of pizza and 56% of Italian offerings originate from pre-2008.

Since then, there has been a clear shift in trends to North American, burger, and BBQ/Steak restaurants, with an 80%, 71% and 52% increase in restaurants since the financial crisis, respectively.

Dining choices are often synonymous with the desire to seek good quality meat, or fresh and healthy ‘world’ food. Consumers are becoming increasingly adventurous with their tastes, as Caribbean, Thai and Mexican brands have expanded rapidly since 2012, albeit from a smaller base.

There is a clear distinction in food styles between longstanding Chinese and Indian restaurant concepts and the Oriental Wok and Street Tiffin operations that have appeared on high streets in the last five years; two thirds of East Asian Cuisine brands are now Thai and Japanese.

^{Source: Savills Research}

^{Source: Savills Research}