As we head into the 2025 holiday season, the retail real estate landscape is buzzing with transformation. In a recent episode of the CRE with CBC Worldwide Podcast, Dan Spiegel sat down with James Cook, Director of Retail Research at JLL, to unpack the latest trends shaping consumer behavior, site selection, and the future of retail.
Here are a few key takeaways from their insightful conversation:
1. 🛍️ Value Retail Is Thriving
In a bifurcated economy, value-driven retailers are leading the charge. Chains like Aldi, Walmart, TJ Maxx, and Ross are expanding aggressively, catering to budget-conscious consumers hit hardest by inflation. Meanwhile, high-income households continue to spend, but middle-income shoppers are pulling back on luxury splurges.
2. 🥤 Beverage Concepts Are Booming
While Starbucks is retrenching and refocusing on its “third place” roots, newer beverage chains like Dutch Bros, 7 Brew, and Swig are exploding in popularity especially among younger, social media-savvy consumers. These brands are capitalizing on the “Instagrammable” drink trend, offering colorful, customizable beverages that double as social content.
3. 🏬 Retail Space Is Scarce
Despite strong demand, new retail development has lagged since 2009. With vacancy rates hovering around 4.3%, competition for quality space is fierce. This is especially true in well-located centers and secondary/tertiary markets, where demand often outpaces supply.
“We haven’t built significant new shopping centers in over a decade,” James said. “That’s created a real squeeze on space.”
4. 🎁 Holiday Spending: A Mixed Bag
JLL’s holiday survey revealed a 10% dip in overall holiday spending, though gift spending remains steady. High-income households plan to spend 26% more, while lower-income households expect to cut back by 24%. Retail real estate is as dynamic as ever. From the rise of social media-driven site selection to the resurgence of bookstores and the evolution of experiential concepts, the industry is adapting to meet the moment.
Listen to the full podcast here or watch the video on the CBC YouTube channel.
