Despite High-Profile Bankruptcies, Texas Retail Thrives with Strategic Leasing & Experiential Demand

In 2025, Texas’ retail market showcases remarkable resilience, countering national store closure trends with low vacancy rates, robust leasing, and a pivot toward experiential environments. Austin (3.4%), Dallas-Fort Worth (4.8%), San Antonio (4.0%), and Houston (5.5%) maintain vacancy rates well below their 20-year averages, driven by population growth, limited new construction, and strong demand from fitness, furniture, specialty retail, and fast-casual dining sectors. Drawing on Coresight Research’s June 2025 tracker, Partners Real Estate’s mid-2025 data, and recent lease signings, this report analyzes Texas’ retail landscape, highlighting closures, openings, vacancy trends, thriving segments, investment opportunities, and market dynamics. Texas outperforms national trends with innovative big box redevelopments and a focus on live-work-play environments, positioning the state as a national leader in retail evolution.

“While national headlines focus on retail bankruptcies, Texas continues to buck the trend with new leases, population growth, and creative reuse of space. Many Texas landlords view the national bankruptcies as a positive as they have been able to achieve higher rents from expanding retailers willing to quickly backfill the recently vacated spaces, ” says Joan Collum, a Partner in Houston, TX,

Future Projections

Short-Term Outlook (2025-2026)

Closures: Texas will see its share of Coresight’s projected 15,000 U.S. store closures, with grocery-anchored centers facing pressure from H-E-B’s expansion and the fallout of the blocked Kroger-Albertsons merger, impacting stores like Tom Thumb and Randalls. However, rapid re-leasing driven by high demand ensures vacancy rates remain low. National retailer bankruptcies, such as Rite Aid and Big Lots, create opportunities for landlords, as replacement tenants often secure higher rental rates than previous occupants, bolstering market stability.

Openings: Dallas-Fort Worth, Austin, and San Antonio lead with significant lease signings in fitness (Crunch Fitness, EoS Fitness), retailtainment (The Picklr, Score Entertainment, Andretti), furniture (Arhaus, Pottery Barn), specialty retail (Primark, Barnes & Noble), and experiential dining (Moxies, Cava, Sweetgreen). Houston sees robust grocery and entertainment activity, while San Antonio’s tourism fuels experiential retail.

Vacancy and Rents: Vacancy rates remain tight—Austin at 3.4%, Dallas-Fort Worth at 5.1%, San Antonio at 4.1%, and Houston at 5.5%—all below their 20-year averages of 4.8%, 6.4%, 5.3%, and 6.0%, respectively. Rent growth of 1–2% annually is expected, driven by rising construction costs, scarcity of prime sites, and increasing NNN expenses due to higher property taxes.

“Crunch Fitness, IKEA, and Primark are betting big on DFW, where demand is reshaping former big box space faster than developers can keep up. On the restaurant side, 2nd generation space is getting absorbed almost as fast as it hits the market. Concepts are being more strategic than ever, locking in
plug-and-play sites to offset high construction and permitting costs,” says Ranjin Mathew, a Senior Vice President in Dallas, TX.

Long-Term Outlook (2025-2026

Texas’ population is projected to reach 32.5 million by 2030 and 47.3 million by 2050 (Texas Demographic Center), fueling demand in high-growth areas like Frisco, The Woodlands, and Alamo Ranch. Retailers increasingly prioritize established markets with strong rooftop populations over speculative greenfield corridors, leveraging advanced analytics and AI to predict sales. Redevelopment, omnichannel strategies, and infrastructure planning to address water and capacity constraints will shape long-term growth.

Store Closings and Openings

National Context

Coresight Research reports 5,822 U.S. store closings (123.7 million sq. ft.) and 3,960 openings (74.5 million sq. ft.) as of June 27, 2025, with closures up 66% year-over-year. A projected 15,000 closures for 2025 reflect 15 retail bankruptcies, inflation, high interest rates, and tariffs. Notable closures include Rite Aid (489 stores), At Home (27 stores), Forever 21, Joann, Party City, and Big Lots.

Texas-Specific Trends

Texas mirrors national closure trends but offsets them with strong leasing activity:

Closures: Retailers like Rite Aid, At Home (Plano-based), and Kroger (24 closures, including two in Dallas-Fort Worth) contribute to Texas’ closures. Randalls closed one Houston store amid H-E-B’s expansion and the blocked Kroger-Albertsons merger. Joann, Party City, and Big Lots also impact urban centers. Despite these, high demand for second-generation space ensures quick backfilling, often at higher rents.

Openings: Major 2025 lease signings reflect Texas’ retail strength:

Dallas-Fort Worth:

  • Crunch Fitness: 40,000 SF in Rowlett (Nov 2025), 35,111 SF in Fort Worth (Nov 2025), 35,000 SF in Forney (Nov 2025).
  • EoS Fitness: 40,000 SF in Dallas (Jan 2025).
  • The Picklr: 80,800 SF in Arlington (Aug 2025).
  • Primark: 32,000 SF at The Parks at Arlington (Feb 2025).
  • Barnes & Noble: 20,388 SF in Rockwall (Apr 2025).
  • IKEA: 63,000 SF at The Shops at Park Lane (Dec 2025). Look Dine-In Cinemas: 48,914 SF in Bedford (Oct 2025).

Austin:

  • Moxies: Flagship location downtown.
  • Crunch Fitness: 43,663 SF on Parmer Ln (May 2025).
  • Balloon Museum: 94,589 SF on W Anderson Ln (Jul 2025).
  • Legacy Padel: 47,907 SF near Airport Blvd (Sep 2025).
  • Club Studio Fitness: 34,000 SF and 810 Billiards & Bowling: 30,000 SF on E Parmer Ln (Jan 2026).
  • Trader Joe’s: New stores in Bee Cave and Leander, strengthening the Austin MSA’s grocery segment

San Antonio:

  • Crunch Fitness: 54,502 SF on SW Loop 410 (Oct 2025).
  • The Picklr: 34,107 SF at Park Oaks (Jun 2025).
  • Cresta Bella Furniture: 33,145 SF at South Park Mall (Jul 2025).
  • Dill Dinkers: 24,000 SF on Beckwith Blvd (Jul 2025).
  • NRG Trampoline: 46,718 SF at Pavilions North (Apr 2025).

Houston:

  • Score Entertainment: 150,000 SF at Deerbrook Mall (Jul 2025).
  • Andretti Indoor Karting and Games: 50,000 SF in Webster (May 2025).
  • Jumping World: 31,500 SF on Eastex Fwy (Aug 2025).
  • Sky Zone: 39,998 SF on Hwy 6 N (Aug 2025).
  • Beauty Empire: 35,362 SF on Jones Rd (Jul 2025).
  • Burlington: 41,927 SF in Texas City (Jan 2025).
  • Sprouts: 30,478 SF in The Woodlands (Aug 2025).

Vacancy Rates and Market Resilience

Texas Market Performance

Texas’ major metros maintain exceptionally low vacancy rates:

  • Austin: 3.4% (vs. 4.8% historic average)
  • Dallas-Fort Worth: 4.8% (vs. 6.4% historic average)
  • San Antonio: 4.0% (vs. 5.3% historic average)
  • Houston: 5.5% (vs. 6.0% historic average)

These rates reflect robust leasing, limited new construction, and a shift toward experiential and core in-fill sites. Retailers prioritize established markets with dense populations, leveraging analytics and AI for predictable sales outcomes.

“Austin’s blend of tech talent, cultural capital, and a booming fitness scene is turning retail into an experience—from upscale gyms to 90,000+ square foot balloon museums,” says Kevin Murphy, a Senior Vice President in Austin, TX.

Comparison to National Trends

Texas outperforms most states due to its population growth, economic diversity, and suburban retail demand. Redevelopment of big box spaces into fitness and entertainment venues stabilizes vacancy, while national bankruptcies create opportunities for landlords to secure higher rents from new tenants.

Thriving Retail Segments

Grocery and Fast-Casual Dining

Grocery competition intensifies with H-E-B, Costco (e.g., 160,000 SF in Weatherford), Sprouts, and Trader Joe’s (new stores in Bee Cave and Leander for Austin MSA) driving growth. Fast-casual dining sees expansion from Cava, Sweetgreen, Shake Shack, and Moxies, catering to experiential demand.

Fitness and Retailtainment

Fitness dominates with Crunch Fitness (over 300,000 SF in new leases) and EoS Fitness (six leases of 34,000–45,000 SF). Retail-tainment venues like The Picklr, Dill Dinkers, Score Entertainment, and Andretti redefine big box spaces, prioritizing live-work-play environments.

Furniture and Specialty Retail

Furniture retailers like Arhaus (37,454 SF in Sugar Land, Jun 2025), Pottery Barn, and Cresta Bella Furniture (38,000 SF in San Antonio) thrive alongside specialty retail such as Beauty Empire, Barnes & Noble, Primark, and USA Beauty Superstore.

Experiential and Pop-Up Retail

Austin’s South Congress, San Antonio’s River Walk, and Houston’s Inner Loop lead in experiential retail. Venues like Balloon Museum, Look Dine-In Cinemas, and Club Studio reflect demand for hybrid retail-entertainment spaces, supported by strong rooftop populations.

Construction Pipeline and Market Dynamics

The construction pipeline remains constrained, pushing demand to second-generation spaces and driving up rents. Rising construction costs, scarcity, and higher NNN expenses due to property taxes increase leasing costs. Retailers require larger tenant improvement allowances (TIAs) and longer-term leases to amortize capital costs, while landlords face underwriting challenges, necessitating increased equity and tenant guarantees. Projects like Texas Heritage Marketplace in Katy and Marvel Town Center in Austin highlight selective new development.

Investment and Occupier Opportunities

Investors should focus on grocery-anchored centers and suburban lifestyle hubs in Frisco, Alamo Ranch, The Woodlands, and Katy. Redevelopment of second-generation big boxes for fitness, dining, or pickleball offers value-add opportunities. Occupiers face fierce competition for prime in-fill sites, where analytics-driven demand ensures stability. National retailer bankruptcies provide landlords with opportunities to re-lease spaces at higher rates, enhancing returns.

Looking Ahead

Texas’ retail market remains a national standout, driven by suburban growth, constrained supply, and innovative space reuse.

From fitness and entertainment anchors to furniture and specialty retail, Texas is redefining retail for 2025 and beyond, with core in-fill sites and experiential projects leading the charge through 2030.

Steve Triolet
Senior Vice President of Research and Market Forecasting
[email protected]
tel 214 223 4008