JLLUnited States | March 2022RetailResearchGrocers grow digitaland physical footprintsin 2021 American cities have begun lifting coviD-19-related restrictions and urgingemployeestoreturntotheiroffices,providingagentleindicationthattheendofthepandemicisnigh-barringanynewvariants,ofcourse.As the dust settles, onefact has become irrefutableon technologicel innovations to meet growinggrocery retailers were among the lbiggest winnersonline grocery demand, while also contencingof the pandemic. As an essential business thatwith the impacts of inflation and consumersplayed a critical role in ensuring food supplyreturn to in-person dining experiences.during a time of great uncertainty, the groceryinclustry grew by 9.4% in 2020 and sustained thatgrowth in 2021, with total grocery sales reachingAlditops list of new store openingsS803 billion last year, representing a nearly16.0% increase over pre-pandemic levels.'Most grocery companies in the U.5. are in growthGrocers capitalized on these gains by reinvesting inmode, evidenced by Datex reporting a 200% increasetheir businesses in the form of store renovations,in new grocery leases in 2021, compared withenhanced fulfillment options and new storethesa me period in 2019. Aldi was the most activeopenings. Moving forward, grocers that wish toremain competitive will have to heighten their focusactivity ensured this past year was no different.2021 fastestgrowing grocersDOE2,500,0001002,000,000801,500,000601,000,000500,00020AlcdiPublixGroceryOutletEagleFreshMarketFoodsMarket43/0289 777 :92/n95 Total new square feet addedNew store count 2021(fo/ cor;pofies with mvitigie bcnne/s, ot/esst one bsnner grecer mvst h:eve mcre thsn 200 stovesTh/s /s c /L anolvsis; our cnteno encomacssed gocers wit: mare tan ss biliov in revenue cno mone chcn 2oo stoves U.S. Census Estimated Monthly Retail. and Food Service Sales by Kind of Business, 2021 3The German retailer announced plans to open 1o0stores in 2021 and made good on that promise for B8locations, totaling more than 2.2 million s.f. of newspace added. And it does not seem to be slowingdown any time soon; the company plans to openapproximately 150 new stores by the end of 2022,with a focus on the Southeast and Gulf Coast, thanksto a recently constructed distribution center in Loxley,Alabama. The current total of 2,158 stores solidifiesAlci as the third-largest grocery retailer in the U.5by store count, right after Kroger and walmart.Other grocers that were in heavy expansion mode in2021 include Publix, which aclcec 1.3 million s.f.of space in Florida, and Grocery Outlet, whichopened just shy of 900,0oo s.f. concentrated onthe West Coast, Offering a 40% discount on itemswhen compared with traditional grocers, GroceryOutlet plans to continue expanding, hoping to addits expansion on the East COAST, openingan additional 28 stores by the end of 2022. Food52 new stores since August 2020 to bring itsLion, a su bsidiary of Ahold Delhaize, also exoandectotal store count to 167. Sprouts added 20its store count considerably last year. The bulk ofadditional locations across the United States.this expansion was concentrated in Georgia andthe Carolinas and came from the acquisition of 71Some grccers opted to focus on enhancing theirunderperforming BI-LO and Harvey's stores fromfu lfillment operations in lieu of opening new stores.Southeastern Grocers. Srmal.er-format stores showedKroger, for example, opened two new fulfillmentsignificant expansion in 2021 as well. In additioncenters in Ohio and Florida as part of its ongoingto Alcli, whose locations tend to average aroundpartnership with the Ocado Grcup, an automaticn25,oo0 s.f., we also saw new store openings fromcompany. The Ocado-automatec center willenable the supermarket giant to serve customersLidl (15,coD s.f, on average) and Sprouts Farmer’sin markets like Pennsylva niawhere it has noMarket (25,00C s.f. on average). Lidl focusedphysical presencevia online grocery serviceU.S. grocery e-commerce sales will continue to grow at a steady rate$300243.770%$25063.9%207.160%(Billions)$200175.350%$150172.4147.528.39%60+ s Sn109.0$11020.5930%56.520%$50ZT10%So0%2019202020212022202320242025% Change YOYSouree eMarieter Retail Fesearch [20224Online grocery is here to stayin business means the industry will nothave to relinquish all of its gains.The initial stages of the pandemic encouraged anatural adoption by many consumers of e-cormmercegrocery options, which resulted in a 63.9% increase inRegional banners compete withonline grocery sales in 202c, according to eMarketer.legacy grocers for market shareConsumers were forced to learn to prepare their ownmeals, and spending on food at home surpassedin Canadadining-out spending for the first time in over aCanadian grocers have also experienced prosperitycecade. Now with wicespread vaccine clistributiond uring the pa ndemic, achieving clouble-cligit salesinfluencing a renewed comtort surrounding in-storegrowth in the past year, Expansion activity hasshopping, P