HOUSTON – Houston is experiencing a retail construction boom with 32 new grocery stores, along with other retail properties in the 2015 pipeline, according to a retail survey by Wulfe & Co.
Wulfe projected that 3.7 million square feet of retail space will open in the Houston area this year, a 56 percent increase over last year.
Houston’s retail construction this year will hit the highest level since 2008, said Ed Wulfe, Chairman & CEO, of Wulfe & Co.,a Houston-based retail real estate brokerage, development and property management firm.
Supermarkets will dominate new retail construction and represent 43% of 2015’s growth with 32 new stores planned. HEB will open seven, Kroger will open four plus expand two, Walmart will open four of their neighborhood market stores, Whole Foods and Sprouts will each add two, Fiesta and Trader Joe’s will each open one, and ALDI will add 11 stores, which have typical small footprint of 18,000 square feet.
“With this high activity of new retail growth we project that higher retail occupancy rates will exceed a seldom achieved rate of 92 % this year. Retail rental rates will also continue to increase driven by limited availability of shopping center space, higher land costs and higher construction costs for materials and labor to build or remodel new retail facilities,” Wulfe said.