How to Navigate the Shifting Retail Real Estate Market in 2026
Introduction
If you’ve been following retail news, you’ve probably seen a stream of store closures—Party City, Bed Bath & Beyond, and more. But beneath that gloomy surface, there’s a surprising countertrend: some chains are aggressively expanding. Dollar Tree is opening 400 new locations, and Starbucks is adding 175 stores in early 2026 alone, according to a new report from real estate firm JLL. This guide will walk you through the key dynamics driving these shifts, so you can spot opportunities, understand regional variations, and make informed decisions—whether you’re a retailer, investor, or simply curious about the changing face of shopping centers.
What You Need
- Market data: Access to reports like JLL’s retail market dynamics (or similar commercial real estate analyses).
- Regional awareness: Knowledge of Sun Belt vs. coastal market trends.
- Industry focus: Understanding of discount stores, restaurants, fitness, and grocery sectors.
- Online vs. offline lens: Awareness of how e-commerce affects brick‑and‑mortar demand for apparel, electronics, etc.
- A blank map or spreadsheet: To track openings, closings, and rent changes in your area of interest.
Step-by-Step Guide
Step 1: Identify the leading growth sectors
Start by looking at which types of retailers are opening the most stores. In early 2026, the leaders are discount dollar stores and restaurants—including Starbucks. Dollar Tree’s 400 new locations and Starbucks’ 175 new stores are prime examples. These chains are betting on high foot traffic and affordable goods, even as other retailers retreat. Pay attention to similar players like Dollar General, fast‑casual chains, and discount grocers—they often fill vacancies left by failed stores.
Step 2: Track closures and vacancy fills
Store closures don’t mean dead space. When Party City or Bed Bath & Beyond shuts down, their prime real estate in shopping centers becomes available. Notice how quickly those spaces are leased—often by grocery stores, fitness centers, and entertainment venues. This pattern shows that the type of tenant is shifting, not the overall demand for physical retail. Map out recent closures in your region and see which new businesses have taken over the spots.
Step 3: Analyze regional rent growth differences
National rent growth is slow, but the story changes by region. Look at Sun Belt cities like Atlanta, Phoenix, and Orlando—they’re seeing rent increases thanks to population inflows and a growing retail customer base. In contrast, coastal markets like Los Angeles and San Francisco are experiencing rent declines due to outmigration and slower demand. The one standout exception is Minneapolis, which has the highest national rent growth at 6.7%. Use this data to decide where to focus your attention—whether for leasing or investment.
Step 4: Understand the e‑commerce effect on retail categories
Online shopping is permanently changing which products sell in stores. Apparel, accessories, and electronics are increasingly purchased online, so demand for those brick‑and‑mortar spaces is dropping. Meanwhile, restaurants, grocery stores, discount retailers, and fitness centers are holding strong (and expanding). These are experiential or necessity‑based categories that e‑commerce can’t easily replace. Study local shopping centers to see if they’ve adapted—are they adding a gym, a dollar store, or a grab‑and‑go café?
Step 5: Watch for early‑year patterns
Retail closures often spike in the first quarter, but the year balances out. In 2025, early closures evened out by year‑end. Don’t panic at Q1 headlines—look at the full‑year trend. Use JLL’s quarterly updates to compare openings vs. closings over time. This will help you separate temporary noise from lasting shifts.
Step 6: Consider the big‑picture shopping center transformation
All these trends are slowly reshaping the typical American shopping center. The old anchor tenants (department stores, electronics chains) are being replaced by a mix of fast‑casual restaurants, discount stores, fitness studios, and grocery anchors. If you’re evaluating a property or planning a new store, ask: Does the center have a diverse tenant mix that attracts daily visits? Centers that rely on food, value, and wellness are thriving; those stuck with apparel and electronics may struggle.
Tips for Success
- Don’t rely on national averages: Local market conditions vary widely. Always drill down to your target city’s data.
- Follow the population: Sun Belt markets are growing for a reason—jobs, weather, lower cost of living. These areas offer stronger retail demand.
- Think like a tenant: If you’re a retailer, choose locations near complementary businesses. A dollar store next to a Starbucks and a gym can create a daily foot‑traffic loop.
- Monitor vacancy absorption: The speed at which former Party City or Bed Bath & Beyond spaces are leased tells you the health of that retail corridor.
- Update your outlook quarterly: Retail real estate shifts fast. Use reports like JLL’s to keep your knowledge current.
- Remember the exception: Minneapolis is bucking the coastal trend with high rent growth—investigate why and whether it’s replicable elsewhere.
By following these steps, you can turn the often‑alarming headlines about retail doom into actionable insights. The market is not dying—it’s evolving. Knowing which sectors and regions are growing, and how empty spaces get repurposed, puts you ahead of the curve.