The £40B Short-Term Retail Revolution: Why Traditional Property Models Are Being Disrupted
A deep dive into the seismic shift reshaping commercial real estate and what it means for the future of retail property.
The commercial property world is experiencing its most significant disruption since the advent of online shopping, and while landlords have spent years adapting to e-commerce's impact on traditional retail, a new phenomenon is quietly reshaping the landscape: the explosive growth of short-term retail.
The numbers tell a compelling story: the UK pop-up retail market now contributes an estimated £2.3 billion annually to the economy (Foot Anstey, 2025) (Tecna UK, 2024), reflecting growing consumer demand for agility, flexibility, and experience-driven shopping, while globally, the sector was valued at $50 billion as early as 2016 (AMA, 2017)—and it’s only grown since.
Yet many in the property industry are still grappling with what this shift means for their portfolios and long-term strategies.
what's driving the shift in retail?
To understand the scale of this transformation, look at how both brands and consumers have evolved. Traditional retailers once committed to decade-long leases and standardised formats. Today’s brands are different: they’re agile, data-driven, and experimental. At Lone Design Club, having facilitated over 100 retail activations across Europe, this shift is clear. Brands want to test, learn, and scale gradually rather than make massive upfront commitments. This isn’t just about pop-ups or temporary stores, it’s a reimagining of how physical retail is conceived, managed, and monetised.
On the consumer side, recent research reinforces the case for change. Despite the digital revolution, 80% of purchases still happen in physical stores (Deloitte, 2025). But the way consumers engage has shifted dramatically. 83% are more likely to return after a positive in-store experience (Fast Company, 2023), and 57% want brands to be more sustainable, even though 61% still prioritise price (Nosto, 2022).
This perfect storm of agile brands and values-driven consumers is exposing a widening gap. Traditional retail models are struggling to meet the growing demand for flexibility, discovery, and authenticity, while short-term retail is thriving precisely because it delivers on all three
The potential of this model becomes clear when examining real-world results. One Belgian cashmere brand, starting with a modest concession space through a flexible retail platform, generated 12x return on investment within months. The brand's success wasn't just about sales, it was about building genuine customer relationships and gathering market intelligence that informed their broader UK expansion strategy.
This pattern is being replicated across sectors. Direct-to-consumer brands are reporting significant sales increases, tied to in-store product launches, pop-up shops, and customer events which consistently deliver measurable returns on investment (CommerceNext & Oracle, 2019). The data suggests that short-term retail isn’t cannibalizing traditional retail, it’s creating entirely new market opportunities.
The Infrastructure Challenge
Despite the clear demand, the property industry faces a significant infrastructure gap. Most landlords currently manage short-term retail opportunities through manual processes - email chains, spreadsheets, and ad-hoc negotiations that can't scale to meet growing demand.
The disconnect is staggering. There are brands ready to pay premium rates for flexible space, and landlords with vacant units, but the systems to connect them efficiently simply don't exist at scale. This infrastructure gap represents both a challenge and an opportunity. Forward-thinking property companies are beginning to invest in technology platforms that can manage short-term retail as efficiently as traditional leasing.
One of the most significant developments in this space is the partnership between Ingka Centres and flexible retail platform providers to create permanent destinations tailored for short-term retail. The Local Hero concept in Brighton’s Churchill Square represents a new model: permanent retail space designed specifically to host a rotating line-up of innovative, independent, and purpose-led brands.
Positioned as a testing ground for international brands exploring UK expansion, the space also offers local consumers the opportunity to discover emerging labels typically only found online. Industry observers note that today’s shoppers are driven by discovery, they’re seeking brands that reflect their values, and traditional retail curation often fails to provide that level of diversity or freshness. This new model has the potential to reshape how physical retail is curated, operated, and experienced.
Technology as the Enabler
The successful scaling of short-term retail depends heavily on technology infrastructure. Platforms that can manage inventory, track customer behaviour across online and offline touchpoints, and provide real-time analytics are becoming essential tools for both landlords and brands.
Investment in retail technology has surged, with some platforms receiving over £1 million in development funding to create systems that can handle the complexity of modern retail operations. These platforms offer features ranging from automated booking systems to comprehensive customer journey tracking.
Short-term retail isn’t just reshaping how brands sell – it’s changing what they prioritise. Many leading platforms are pioneering more sustainable approaches, using recycled materials, modular designs, and upcycled fixtures from studios and theatre sets. This shift helps reduce the waste often associated with traditional buildouts, while aligning with growing consumer demand for responsible business practices.
At the same time, this flexible model is gaining global traction. From Europe to North America and Asia-Pacific, brands are using short-term retail to test new markets with minimal risk – while local labels gain access to prime spaces that were previously out of reach.
Together, these forces are turning short-term retail into a globally scalable, future-proof format – one that supports innovation, sustainability, and accessibility on a whole new level.
The Future Landscape of Retail Property
The retail property sector has reached a critical inflection point. Industry experts predict that by 2028, short-term retail will be a standard feature in most major commercial developments.
The question is no longer if this shift will continue – but how quickly traditional property models can evolve to meet it. his transformation is being fuelled by:
- Shifting consumer behaviours
- New brand strategies
- Rapid advances in retail tech
Landlords who embrace flexible formats and experience-led strategies now are positioning themselves for long-term success. Those who hesitate risk falling behind, stuck with underperforming assets and outdated operations.
📈 With the market moving toward its projected £80 billion valuation by 2028, this is a strategic moment property professionals can't afford to miss.
The implications reach beyond individual buildings. Shopping centres, high streets, and entire commercial districts that support short-term, agile retail will outperform those tied to rigid models.
Want to explore how short-term retail could activate your space?
Get in touch at info@lonedesignclub.com or book a demo to see how our platform supports agile retail strategies, flexible leasing, and brand partnerships that drive results.