Texas Tops in Retail Construction

For the first time since such records have been kept, Texas is leading the U.S. in retail construction, according to a just-released article by researchers at commercial real estate advisor Colliers.

Specifically, developers delivered an average of 6 million to 7 million square feet of new retail space per quarter from 2016 to 2019, holding vacancies near 4% while meeting demand from national chains and local operators. Although construction slowed in 2020 amid pandemic-driven uncertainty, activity quickly rebounded, and by early 2025, more than 17 million square feet was under construction — one of the highest levels in the country.

What’s fueling this boom? Two complementary factors, Collier says: The Lone Star State’s booming homegrown population and its strong in-bound migration. “Between January 2021 and January 2025, the state recorded a positive net domestic migration of 0.9%, and post-pandemic, 19.1% of Californians who relocated chose Texas — a clear sign of its appeal for affordability, job opportunities, and a pro-growth environment,” Colliers reports.

That performance is in stark contrast with the national landscape, where construction activity remains historically low. Just 6 million square feet of retail space was delivered nationwide in the second quarter of 2025, bringing total space under construction to 47.9 million square feet.

“Elevated financing and construction costs continue to limit new standalone retail development, while demand for multifamily, industrial, and mixed-use projects drives developer focus elsewhere,” the report notes. “Since 2020, only 21 million square feet of newly built retail has been listed for lease nationally, less than 5% of all available space. Notably, nearly one-third of that first-generation space is concentrated in Texas, underscoring the state’s position at the center of the nation’s retail development pipeline.”

The report also details the factors driving retail construction activity in the state’s four largest markets: Austin, Dallas-Fort Worth, Houston and San Antonio.

Click here for more from the Colliers article.