Texas, August 19, 2025
News Summary
The retail construction sector in Texas is booming, with over 17 million square feet currently under construction, driven by population migration and high demand. Major cities like Dallas, Houston, Austin, and San Antonio are leading this growth. While nationwide retail construction remains low, Texas showcases continuous development with innovative projects like the Dunham Pointe in Cypress. This growth is fueled by rising population, household incomes, and consumption levels, particularly in urban areas, impacting local economies positively.
Texas
The retail construction sector in Texas is experiencing a significant boom fueled by population migration, according to a recent report from Colliers. As of early 2025, over 17 million square feet of retail space is currently under construction across the state, attributed to a positive net domestic migration rate of 0.9% from January 2021 to January 2025.
The majority of this growth is concentrated in Texas’s largest metropolitan areas, including Dallas, Houston, Austin, and San Antonio. In contrast, national retail construction activity remains low, with only 6 million square feet delivered in the second quarter of 2025 and a total of 47.9 million square feet under construction across the United States.
Impact on Local Economies
Austin currently leads the state in construction intensity, with 2.8% of its retail inventory under active development. This city also boasts the highest retail occupancy in Texas at 97.1% as of the last quarter of the previous year. The Dallas-Fort Worth (DFW) area, which is experiencing the most extensive inventory growth, has 7.2 million square feet of retail space under construction. Despite recent store closures causing negative net absorption for the first time in over two years, DFW maintains approximately 3.6 million square feet of annual absorption on average.
Furthermore, Houston is emerging as a formidable residential and retail market, issuing 11,000 building permits in the first two months of 2025, the highest of any market in the U.S. This market exhibits stable rents and low vacancy rates between 5-6%, complemented by a development pipeline of 3.6 million square feet.
San Antonio is also witnessing increased construction activity, with 1.7 million square feet under construction in 2025, marking its most active development period in recent years. The city has maintained high retail occupancy rates averaging over 96%.
Factors Driving Growth
Several factors contribute to Texas’s robust retail sector, including population growth rate of 2.6% in Austin, rising household incomes, and increased consumption levels attracting retailers. Houston’s dynamic market conditions, characterized by competitive land and construction costs, further support its continued growth.
Planned Developments
Significantly, Trademark Property Co. plans to develop a 205,000 square foot mixed-use retail and restaurant district named Dunham Pointe in Cypress, Texas. This project will include residential, office, retail, and commercial facilities, alongside 2,500 custom homes and a public school. Preliminary lease offers have already been made by 48 tenants for this innovative mixed-use development, with construction expected to begin in the fourth quarter of 2025 and openings planned for early 2027.
National Context
Despite Texas’s surge in retail construction, nationally, only 21 million square feet of newly built retail space has been listed for lease since 2020, representing less than 5% of all available retail space. Notably, nearly one-third of first-generation retail space across the country can be found in Texas, indicating the state’s vital role in the national retail landscape.
Key Figures
| Metric | Texas | USA |
|---|---|---|
| Retail Space Under Construction | 17 million sq. ft. | 47.9 million sq. ft. |
| Newly Built Retail Listed Since 2020 | N/A | 21 million sq. ft. |
| Retail Occupancy Rate (Austin) | 97.1% | N/A |
| Average Vacancy Rates (Houston) | 5-6% | N/A |
What is driving the retail construction surge in Texas?
The surge is largely fueled by a positive net domestic migration, population growth, rising household incomes, and increasing consumption levels, particularly in major cities like Austin and DFW.
How does Texas’s retail construction compare nationally?
Texas is experiencing an unprecedented boom, with 17 million sq. ft. under construction, while nationally, retail construction remains historically low with only 47.9 million sq. ft. across the U.S.
What major developments are happening in Texas?
One significant project is the Dunham Pointe Development in Cypress, Texas, planned to include a 205,000 sq. ft. mixed-use retail and restaurant district along with residential facilities.
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Additional Resources
- Chain Store Age
- Wikipedia: Texas
- CoStar
- Google Search: Texas retail construction
- Shopping Center Business
- Google Scholar: Texas retail development
- Community Impact
- Encyclopedia Britannica: Texas construction
- Yield Pro
- Google News: Texas development
Author: STAFF HERE SAN ANTONIO WRITER
The SAN ANTONIO STAFF WRITER represents the experienced team at HERESanAntonio.com, your go-to source for actionable local news and information in San Antonio, Bexar County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Fiesta San Antonio, San Antonio Stock Show & Rodeo, and Dia de los Muertos. Our coverage extends to key organizations like the Greater San Antonio Chamber of Commerce and United Way of San Antonio and Bexar County, plus leading businesses in retail, insurance, and energy that power the local economy such as H-E-B, USAA, and Valero Energy. As part of the broader HERE network, including HEREAustinTX.com, HERECollegeStation.com, HEREDallas.com, and HEREHouston.com, we provide comprehensive, credible insights into Texas's dynamic landscape.
