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The most obvious thing I can think of is that it was an island, which meant that in order to trade with other parts of the world, it had to build ships (though this did not happen in any great force for some time... I believe it was not until Henry VIII that England began really digging into the business of shipbuilding on a grand scale). In addition, this meant that people wanting to trade with England had to sail to England in order to trade for valuable commodities, particularly wool. Being a center of trade in this way is how London became the largest city in the world by the reign of Elizabeth I.

So you have this enormous amount of trade going on, which is stimulating the economy, but also to the knowledge of ship building. During the Tudor era though, Spain began developing an empire in the New World, and the money they gained from this made them the most powerful empire in the world. This was not a problem for England until Henry VIII decided he needed to divorce his wife, who happened to be a Spanish princess. This incurred the wrath of Spain, who's king was also the Holy Roman Emperor at the time. Anyway, this was the beginning of tensions between Spain and England, which would necessitate Henry VIII's forays into building a prime naval army to compete with Spain's (he didn't succeed in this). During the reign of his daughter, Elizabeth I, England finally managed to defeat the Spanish Armada when Spain launched a full assault on England after the beheading of Mary, Queen of Scots, but this victory was mostly due to luck, not a large navy, or particularly skillful tactics.

What these conflicts did was force England into becoming more dominant on the seas: they could not hope to build a proper empire in the New World (which they had to do in order to compensate for the power and wealth that Spain was gaining from their own colonies, this was a political belief in Europe at this time called the "balance of power") if they didn't have the navy to protect trade vessels ferrying goods across the Atlantic (note: Elizabeth herself encouraged Englishmen to engage in the piracy of Spanish ships to plunder bullion and goods coming from the New World, so she knew very well that the Spanish had reason to retaliate in a similar way).

If the British Isles were not so far west and proximate to Spain, these conflicts would likely not have escalated so much as they did. But the fact that they did meant that the booming industry of trade in London spawned what would eventually become the most powerful naval force in the world, and a dominant navy is the most important thing in the building of a massive overseas empire.

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