Courtesy / CBRE
Nearly six months have passed since one of the world’s largest grocery retailers was to have opened a store on San Antonio’s far Northwest Side, bringing its low-cost model for everything from groceries to clothing into a region dominated by H-E-B.
On Monday, a Lidl spokeswoman responded to an email from the Rivard Report by stating, “We have secured a number of sites in Texas for future growth but have not set a formal timeline for expansion into the state. Our operational focus is along the East Coast where we are currently expanding and operating stores. As we have more to share in the future, we will be in close contact.”
Though construction has not begun on a store, Lidl maintains ownership of the 5.3 acres of land it purchased after Abiso Development subdivided 12 acres into four plats at the Alamo Ranch and Lone Star intersection in July 2017.
Lidl bought the land in 2017, according to an announcement at the time from commercial real estate firm CBRE, with a store opening slated for fall 2018. The purchase was part of Lidl’s bold move into the U.S. market, where it first opened stores in Virginia, North Carolina, and South Carolina.
Today, Lidl has 60 U.S. stores in cities along the East Coast – from Augusta, Georgia, to Union, New Jersey – and late last year acquired 27 Best Market stores in New York and New Jersey. But there are no stores in Texas, where Lidl is reported to have purchased land in both Dallas and Houston as well as San Antonio.
On Feb. 1, Lidl announced that it had appointed Roman Heini as chairman of the Arlington, Virginia-based Lidl US. That appointment followed a leadership change in May 2018 when the company named CEO Johannes Fieber as president and CEO of Lidl US, succeeding Brendan Proctor, who held that role since June 2015, when the U.S. headquarters opened.
A company statement said Heini and Fieber will focus on “optimizing operations for the U.S. stores and driving Lidl US’ growth into new markets on the East Coast.”
A business strategist and contributor to Forbes, Brittain Ladd, wrote last year that the company’s real estate strategy in entering the U.S. market was all wrong. “Lidl has struggled to generate consistent foot traffic in its stores because many stores are located in areas outside of traditional grocery shopping locations.”
Ladd blamed that misstep on the company’s failure to understand the difference between grocery retailing in the U.S. and Europe. Lidl operates 10,000 total stores in 29 countries. While analysts report Lidl’s U.S. stores are larger than in other countries, carry more products, emphasize organic and locally sourced products, and are in higher-traffic locations with better fittings and furnishings, this means higher costs in a fiercely competitive market.
“I know Lidl is very proud of its culture and operating model,” he wrote. “[British supermarket] Tesco was proud of its culture and operating model as well. Tesco still failed in the U.S. … I am confident that if Lidl doesn’t change course, they will exit the U.S. sooner rather than later, and it will harm Lidl’s potential for entering Canada and eventually Mexico and Latin America.”
Adjacent to the Lidl property in Alamo Ranch, Metropolitan Contracting has started site work at the other lots on the corner of Alamo Ranch and Lone Star parkways, and CBRE is representing Abiso to lease space in a proposed 30,000-square-foot retail and restaurant center on the corner.
Developer Blake Honigblum of Abiso did not return messages, and a CBRE spokeswoman declined to comment.
Lidl also owns land in Universal City, on Culebra Road, and on FM 78 in Northeast San Antonio, according to county tax records.
In November 2017, H-E-B opened a 93,000-square-foot store less than a mile from the Lidl site in this fast-growing area just outside San Antonio city limits.