The Canadian grocery sector continues to show impressive resilience and growth, despite ongoing challenges in the broader retail landscape.
According to Paul Ferreira, Senior Vice President at JLL, the country’s three major grocery chains—along with discount banners like No Frills—are thriving, with store counts increasing steadily across the nation.
Ferreira notes that grocers are expanding to meet the demands of a growing population while also adapting to shifting consumer preferences, including changes in demographics and pricing strategies.
Grocery-anchored retail remains one of the most stable and sought-after asset classes in real estate, with post-pandemic recovery driving increased foot traffic to these centres. Ferreira highlights how grocery stores have responded to rising concerns over food prices by bolstering their discount offerings, with brands like Loblaws continuing to expand their No Frills banner in response to market pressures. As Canadians become more value-conscious, this shift towards budget-friendly shopping options is expected to continue gaining momentum in the year ahead.
The overall outlook for grocery-anchored retail is optimistic, with stronger co-tenant activity as increased traffic benefits surrounding retailers. As hybrid work models become the norm and more Canadians spread their shopping visits throughout the week, this increased footfall is proving advantageous for the broader retail real estate sector.
Ferreira emphasizes that for both grocers and their retail partners, maintaining a robust and adaptable presence is key to staying competitive in this dynamic market.
JLL’s Grocery Report 2025 said grocers have remained resilient in the face of persisting (although improved) inflation and economic uncertainty, following through on their long-term growth plans and opening new locations. However, as consumer preferences change with the times, so must grocers. To better appeal to and maintain relevancy with consumers today, grocers continue to innovate, investing in their brands and services, further enhancing the grocery shoppers’ experiences.
“We have our three major grocery chains in Canada that have various banners underneath them. Through consolidation, over the years they have gotten stronger and stronger. We have seen considerable increase in store counts across the country. They’ve continued to grow across different banners, but they’ve always generally been in growth mode as population has grown and they’re expanding to meet those needs,” said Ferreira.
“And they’ve also been expanding and re-bannering stores to meet different responses to consumers. Whether that’s a changing demographic, a changing price point that perhaps might better suit a trade area. So we’re always seeing them respond to market changes. That’s always been inherent in our grocery industry in Canada and, and beyond.”
Ferreira said grocery-anchored retail has for a long time been the steadiest retail asset class.
“It’s been the most in-demand asset class from an investment perspective. it’s the type of retailers that want to be present in grocery-anchored retail that has been the kind of retailers that we’ve seen expand the most, especially in a post-pandemic environment where we’ve seen the most activity,” he said.
“Grocery prices have been very prominent in media discussion around the grocery industry. It’s been a kitchen table topic and a cocktail party topic of discussion for Canadians in general. That being said, I think we are seeing our grocers respond to the public, to Canadians’ call to see a growing response to the concern on prices. One of those responses is expanding their discount banners. We’re seeing Loblaw doing that across the No Frills banner. We’re seeing the other grocers re-bannering some stores. But we’re also seeing growth in the mainline store as well.
“There’s data showing that visits to grocery stores in the post-pandemic era have increased and that is good for grocery-anchored real estate. Seeing traffic increase in those centres in general. If the grocers were able to report increased traffic, that’s good for all of the co-tenants that can feed off that traffic and that increase in traffic is both in response to new hybrid working conditions where people aren’t having to do their shopping in one day. They’re leaving it for multiple points throughout the week and perhaps more competitive shopping that we’ve seen in response to those higher prices where people are visiting multiple stores to try and get the most value for their grocery dollar.”
