'Experience & Services' Overtake Goods in U.S. Retail Leasing

RETAIL SHIFT · 2025Source: Wall Street Journal · 2025

"Experience & Services" Overtake Goods in U.S. Retail Leasing

50%+

Services share of retail space (2025, first time)

$2.1T

U.S. wellness market (2024)

~30%

Fitness share of services (vs 20% in 2016)

4.4%

Retail vacancy — near historic low

Goods vs Services — Share of U.S. Retail Leased Space

2010

Goods 60%

Services 40%

2025

Goods 49%

Services 51%

First time services crossed 50% in U.S. retail leasing.

Why the Shift — 4 Forces

Experience over ownershipYoga classes and facials are replacing luxury bags as status signals.

E-commerce hollowing out shelvesOnline retail rose from 8% (2016) to 16.4% (2024) of total — apparel & daily goods no longer need big floor space.

Social-media appearance pressureBlowout salons, nail bars, hair-removal chains are surging as "looking camera-ready" becomes a daily concern.

Post-pandemic social reboundGyms, boxing studios and Pilates clubs are the new after-work hangouts — a function pure e-commerce can't replicate.

What's filling vacated retail? Service tenants are absorbing space left by bankrupt chains (Rite Aid, Joann). One Philadelphia suburb example: a 10,200 sq ft liquor store closed, was split into four small service tenants — total rent rose +20% and foot traffic increased. Forward: Planet Fitness added 1M+ members last year and plans ~200 new stores in 2026; Ozempic-class weight-loss drugs are further lifting fitness demand. F&B looks fatigued, but wellness continues to expand. Americans visit malls less to buy stuff and more to "get healthy, get pretty, find community" — the future of physical retail belongs to experiences that e-commerce cannot replicate.