Written by Kim Kennedy, Director of Forecasting on January 31, 2019
It’s not news that the retail industry has been under a great deal of stress in recent years as online shopping pockets an ever-increasing share of consumer spending. New construction data from Dodge Data & Analytics show that even the giants of retail are not immune to this stress. Although Walmart construction expenditures were roughly $1 billion in 2018 on new construction starts, additions, and renovations, that level of spending was down 11% from 2017 – and 2017 was down 18% from the previous year. Despite the declines, Walmart construction still outspent second-place Aldi’s Food Store by three-to-one last year.
Not all the largest stores lowered retail construction over the past year, however. Competitive pressures kept some in expansion mode, or at least in renovation mode. Second-place Aldi’s, for example, grew retail construction starts by 2% in 2018 to $311 million following a 77% surge in 2017. Third-place Target has also been on a construction spree with increases of 183% in 2016, 52% in 2017, and another 19% in 2018 which brought the total dollar value of starts to $229 million.