Ground Control: Retailers Are Leaning Into Buying Their Spaces
Numerous factors are behind a shift that’s engaging a diverse range of businesses.
Though there’s certainly nothing new about retailers owning their own spaces, the past few years have seen a surge of acquisitions by a range of retailers, from grocery chains to luxury brands.
The retail real estate experts with whom Commercial Property Executive talked confirmed this trend, in part by largely agreeing on which retailers are active, such as Publix, Target, Walmart and a handful of luxury brands, and singling out a few of the same deals.
One of those acquisitions was Walmart’s $34 million purchase of Monroeville Mall, near Pittsburgh, in February 2025. With an annex, the mall totals about 1.2 million square feet.
Another example was the August 2025 acquisition of Longview Mall, in East Texas, also for $34 million by Dillard’s—one of the mall’s original anchors—and Trademark Property Co.
Though some retailers have always owned their premises, Bryn Feller, a senior vice president & managing director at Northmarq, remarked that what’s different now is the scale and intent behind it.
“There’s still a lingering narrative that brick-and-mortar retail is in decline because of e-commerce, but when you look at actual availability, especially for larger-format space, that’s just not what we’re seeing. Anchor vacancy is still very tight, even after a wave of bankruptcies. A lot of those spaces have been absorbed pretty quickly by expanding tenants like Burlington, Ross and TJ Maxx,” she said.
“Why it’s a headline these days is because the intensity of it has changed,” emphasized Meghann Martindale, principal leading retail market intelligence at Avison Young. “And there are a couple of bigger forces at play in the industry, namely just how resilient retail’s been, how tight supply is, record low vacancy rates, record low new construction and high demand.”
Commenting on the shift’s broad base, Scott Schnuckel, CBRE’s managing director of retail for the Americas, remarked that mass merchandisers are buying malls and redeveloping them, grocers are taking ownership stakes and luxury brands are buying flagship locations.
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What’s happening is a convergence of diverse issues, said Brian Connolly, founder & CEO at Feasibly. “The market is supply constrained at the exact moment when top locations matter more than ever. New construction is muted, vacancy is low, and backfill demand for quality space is strong, which means the best sites are both scarce and getting more strategic,” he said.
If those factors have pushed real estate acquisitions by retailers, other factors have provided some pull. Sources describe operational flexibility as a major inducement to buy spaces, provided that retailers can handle the capital expenditures and have access to the needed capital.
What these factors mostly boil down to, our sources agreed, is control, both in the shorter and longer terms, underscoring evolving retail industry trends.
“Part of this is simply access, getting control of locations that are hard to replicate,” Feller said. “But the bigger driver is strategic. When you own the center, you’re no longer dependent on a landlord’s decisions around tenant mix, capital improvements or long-term positioning. You can shape the environment your store operates in, instead of reacting to it.”
She continued, “I think of it less as ‘We want to own real estate’ and more as ‘We’re willing to own real estate if it allows us to improve or expand our operating business in a way we otherwise couldn’t.’”
“In some cases,” Feller continued, “it’s also a way to break into markets that were previously closed off. The Monroeville Mall acquisition outside Pittsburgh is a good example. Walmart had tried for years to get a traditional store approved there and ran into entitlement challenges. By acquiring the mall, they effectively created their own path into that market.”
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Alanna Loeffler, senior managing director & retail platform lead at Cushman & Wakefield, listed some key drivers of retailers owning their assets, such as rising rents and operating costs that make long-term leases less attractive; the scarcity of prime locations, especially in urban and top-performing suburban sites; and stronger balance sheets that are giving major retailers cheaper access to capital than many landlords have.
By owning their sites, she noted, retailers can gain permanent access to high-barrier, supply-constrained locations, eliminating renewal or displacement risk, and can also gain the freedom to optimize or evolve store formats, omnichannel uses and customer experiences.
Martindale puts the situation briefly: “The fundamentals are contributing to this intensification because the retailers who have the access to capital can go, ‘Nope, game changer, whole new playbook, whole new strategy. We can just go in and buy the thing.’ And then that gives them a little bit more flexibility in terms of what their opportunities are.”
Luxury retailers seek only the best
Luxury retailers seem to constitute a bit of a distinct and aggressive category in all this. Martindale is seeing luxury players buying buildings primarily to be the sole operator, in upscale urban districts such as Miami’s Lincoln Road or Design District or New York City’s Fifth Avenue.
Anjee Solanki, national director, retail services & practice groups | U.S., at Colliers, said that the trend of large retailers acquiring real estate to secure long-term control over high-performing locations “is especially evident among luxury brands like LVMH and Kering, which have increasingly purchased flagship properties in global gateway markets to anchor their presence.”
“Control is a major driver,” she continued. “Ownership gives retailers influence over co-tenancy, merchandising mix and the overall customer experience. Luxury brands in particular use this strategy to fully control brand presentation and ensure adjacency to complementary tenants. Luxury groups such as Chanel and Prada have been particularly active, viewing real estate as a strategic asset that supports brand equity while diversifying holdings.”
Capex, investment, balance sheets
In all of this, Connolly cautioned, capex is a key factor, because redevelopment has replaced new construction as the primary way supply comes to market.
“With construction costs elevated and new projects limited, retailers are stepping in to deploy capital directly into assets they occupy. That alignment lets them control timing, scope, and return on investment rather than relying on landlord-driven capital cycles,” he said.
Schnuckel pointed out that the strong performance of retailers and retail real estate is helping to draw institutional capital back to the sector.
On the question of whether buying retail space is more of an investment decision or a balance sheet one, Connolly believes that it’s both, although the investment case is becoming more compelling again.
“Transaction activity has picked up and pricing has stabilized, which makes retail real estate a more predictable asset for well-capitalized operators. For those retailers, ownership converts a fixed occupancy cost into a long-term asset with optionality, while also reducing exposure to rent volatility,” he added.
Loeffler highlighted the other side of that question, saying, “The balance-sheet side of this strategy has become more prominent since 2023.”
From a financial perspective, she said, real estate ownership converts rent (an operating expense) into a depreciable asset, provides collateral and flexibility for future financing, and creates potential opportunities for sale-leasebacks or joint ventures later on.
In fact, Loeffler sums up this whole shift in retailing nicely: “Buying assets provides certainty, flexibility and financial resilience, especially for well-capitalized brands operating in a volatile retail and capital markets environment. The result is a lasting shift where retailers are acting more like real estate owners, and real estate is becoming a core part of retail strategy, not a separate function.”
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