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5 Hot Markets for Retail Investment

5. San Antonio

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5. San Antonio
Illustration: WGB staff / Shutterstock

Population growth: 1%

Job growth: 6.1%

Market analysis: San Antonio’s above-average population and job growth, which resulted in retail sales growth, pushed it higher on CrowdStreet’s top places to invest for retail, Strub said, adding that the city also recovered well from the pandemic, with the unemployment rate dropping from a peak of about 11.6% down to 5.4%. “It has a diverse economy with a large military presence, financial services, tourism, oil and gas, automobile manufacturing, technology and higher education,” he said. “San Antonio has also been a beneficiary to the growth of Austin, as the two cities are 80 miles apart it is starting to feel like one labor market, not on the same tier as Dallas-Fort Worth but becoming more similar.”

Grocery market share in 2021: H-E-B at 91.3% overwhelmingly had the highest market share of the top 10 traditional grocers, with Walmart Neighborhood Market coming in second with 2.4% share and Houston-based Spec’s third at 1.2%, according to Placer.ai data.

Of the top two wholesale clubs in the region, Sam’s Club had the largest market share at 58.8%, but Costco is encroaching on the retailer with 41.2% share. Costco’s share also increased 15.4% from 2019 to 2020, according to Placer.ai, as it opened a new store in San Antonio in 2021 and indicated it sees the opportunity to gain stronger footing in the middle-America markets where Sam’s Club is strongest, particularly following a 63-club “right-sizing” in 2018, where Sam’s retreated from several regions in which it looked up to Costco’s share.

Walmart once again, at 79.8%, had the highest market share among superstores, with Target at 20.2%, but its share fell 1.2% vs. 2019; and of the top five dollar stores in the region, Dollar Tree had 38.2% share, followed closely by Dollar General at 33.1% and then Family Dollar at 15.6%