This trend was especially evident in the immediate aftermath of the pandemic, with a peak in capital investment into consumer-facing retail, leisure, and F&B businesses in 2021, reaching £332 billion globally (see figure 13). While the number of deals has declined, the average capital deployed per transaction has increased, resulting in more meaningful investments, and therefore more likely to translate into physical store expansion.

The 2021 investment peak helped drive the improved occupational demand observed across gateway markets globally since 2022. Looking at activity so far this year, capital deployment has already reached £301 billion, 13% above the full-year total for 2024. This momentum is expected to continue supporting robust occupational demand over the next three years.

What segments will be the most acquisitive?

Looking at deals exceeding £5 million since early 2024, the segments attracting the most significant investment include specialty retail (e.g., convenience stores, petrol forecourts, and niche categories like workwear), department stores, fashion, restaurants & bars, and leisure businesses. However, in terms of cross-border activity in gateway cities it will be the latter three – fashion, restaurants & bars and leisure – that are expected to be the most acquisitive. This aligns with the acceleration in investment into these segments over the past two years and mirrors historical patterns of new entrant activity (see figure 8).

While not capturing the same volume of investment, sports & athleisure and health & beauty have seen notable surges in capital deployment up 304% and 169% year-on-year, respectively, across 2024/25. These trends suggest further occupier expansion is likely within these segments, particularly as they align with evolving consumer preferences and lifestyle shifts.

Wellness comes to the fore

An analysis of recent investment verticals reveals a growing investor focus on wellness-related concepts, reflecting evolving consumer preferences. Among capital raises exceeding £5 million since early 2024, 7% of total capital was deployed into businesses with a wellness angle.

Beyond fitness concepts, restaurants & bars and health & beauty concepts accounted for the majority of wellness-related investment, 25% and 20%, respectively. These concepts often carry strong ESG credentials and brand standards, which can influence location strategy, building selection, and fit-out requirements.

US to remain a key source market for expansive brands and concepts, but new source markets are emerging

US brands and concepts continue to be the most well-capitalised globally. Since early 2024, capital deployed into US headquartered business totalled just over £95bn, followed by the UK at nearly £18bn. Within the larger cross-border segments, US restaurants & bars account for the largest share of capital deployed (34%), indicating that the recent acceleration in US QSR (quick service restaurant) expansion across Europe is set to continue.

While the major source markets have all seen increased capital deployment, new entrants have emerged in the top 10 since early 2024. Canada and Japan have moved up the rankings, with investment concentrated in sports & athleisure and leisure segments, respectively. For Canadian brands, the US has traditionally been the primary target for cross-border expansion. However, recent trade and geopolitical tensions are tempering this activity, prompting a strategic shift toward Europe and Asia Pacific.

Italy, France, and Spain will remain significant exporters of expansive fashion brands. However, China is poised to become an increasingly important source market, with 31% of Chinese-focused investment directed toward fashion retailers and brands. A growing number of Chinese fashion brands are pursuing global expansion to diversify revenue streams and reduce reliance on domestic consumers post-pandemic, something that has been observed in the new entrant data. One example is Urban Revivo, often referred to as the “Zara of China,” which operates over 400 stores—primarily in China—and made its European debut in London in 2025, followed by New York the same year. The brand aims to grow its non-China store network by 200 locations over the next five years.

Australia is also emerging as a notable source market for fashion brands. While investment activity over the past two years has been relatively modest—just 3% of capital deployed into fashion businesses—this follows a period of significant activity. For instance, 40% of capital invested into Australian brands across core segments in previous years went into fashion, totalling nearly £200 million. This is already translating into new store acquisitions: since 2022, eight Australian brands have opened their first European sites in London, half of which were fashion-focused. This momentum is expected to continue and broaden beyond London to other attractive gateway markets in Europe.

_{Read the other articles within European Retail Market below}