What Is Grocery-Anchored Retail and Why Investors Buy It

Anchor economics

What does grocery-anchored mean?

A grocery-anchored center is an open-air neighborhood or community shopping center whose largest tenant, the anchor, is a supermarket. Examples of anchors are Kroger, Publix, H-E-B and Aldi. The rest of the center is "inline" space: smaller tenants such as a pharmacy, quick-service restaurants, services, medical offices and fitness. The grocer brings shoppers back every week, and the inline tenants live on that traffic.

Anchors often sign long triple net leases. Because the inline shops depend on the grocer's traffic, the grocer's health matters well beyond its own rent check.

Why do investors like grocery-anchored shopping centers?

Investors like grocery-anchored shopping centers because groceries are a need-based purchase that is hard to move online, so the anchor drives frequent, repeat visits. JLL's 2026 Grocery Tracker found 4.0% vacancy in grocery-anchored centers at the end of 2025, against 6.3% in centers without a grocer. It also found a 4.4% rent premium.

Relli co-founder and CEO Mor Milo makes the case that physical retail still draws people for more than errands:

"People want to be experiencing life in these different types of retail environments. They want to shop, they want to go to restaurants, they want to enjoy with their friends and their family."

Mor Milo, Relli co-founder and CEO, in Retail isn't dead (September 18, 2026)

Three retail formats

How is a grocery-anchored center different from other retail property?

A grocery-anchored center differs from other retail property in who pays the rent: many tenants share the center, and one supermarket brings the traffic. A center without a grocer depends on discretionary shopping, and a single-tenant triple net retail building depends on one company.

The owner of a multi-tenant center has more to manage than a net lease landlord. There is inline space to lease, common areas to run and tenants to replace. That work is where an operator's skill shows up in the results.

2026 numbers

How have grocery-anchored cap rates moved since 2023?

Grocery-anchored cap rates averaged about 6.7% nationally at the end of 2025, roughly 40 basis points below their 2023 peak, according to JLL. Relli found no free national grocery-anchored figure for 2026. CBRE's H1 2026 survey says neighborhood retail cap rates compressed more than any other sector, without publishing a number. Listed shopping center real estate investment trusts (REITs) carried an implied cap rate of 6.2% in Q2 2026 (Nareit).

Interest rates are the pressure point. JLL's 6.7% sat about 2.5 points above the 10-year Treasury at the end of 2025 (4.18%). With the 10-year at 5.09% on October 16, 2026, the same cap rate would sit only about 1.6 points above it. That is Relli math, and the dates differ. Read cap rate math before comparing deals.

Is grocery-anchored retail a good investment in 2026?

Grocery-anchored retail can be a good investment in 2026 for investors who want need-based tenants. Space is tight and little is being built. Traffic is steady rather than booming, though, and higher rates press on values. The facts, with their dates:

• Shopping center vacancy was 5.9% in Q3 2026, against a 7.4% historical average, and asking rents rose 2.2% over the year (Cushman & Wakefield).
• The construction pipeline was just 0.4% of existing shopping center space (Cushman & Wakefield, Q3 2026).
• Kimco, a large shopping center REIT, reported 96.4% leased occupancy in Q2 2026, with anchor space at 97.8% and small shops at a record 92.9%.
• Grocery store visits rose 0.9% year over year from January to August 2026 (Placer.ai, via Grocery Dive).
• E-commerce reached 17.1% of U.S. retail sales in Q2 2026 and grew 12.2% from a year earlier (U.S. Census Bureau).
• Retail loans in commercial mortgage-backed securities were 6.58% delinquent in September 2026 (Trepp, via YieldPro).

If the grocer leaves

What happens if the grocer leaves?

A center that loses its grocer loses its traffic, and co-tenancy clauses can let inline tenants cut their rent or end their leases. The same can happen if the grocer "goes dark" (closes the store but keeps paying rent). The loss can be much larger than the grocer's own rent.

JLL's vacancy and rent premium apply to centers that keep a strong anchor. When you review a deal, ask how many years the grocer has left and whether it has renewal options. Also ask which inline tenants hold co-tenancy or kick-out rights.

Retail or apartments

Retail real estate vs multifamily: which is better?

Neither retail nor multifamily is better in general; each carries different risks, and the deal and the sponsor matter more than the property type. The measures below are each labeled with their source, because vacancy and cap rate methods differ.

An apartment building spreads its rent across many households, while a grocery-anchored center leans on one anchor and a mix of shops. The multifamily guide covers apartments in depth.

Owning a center

How can you invest in shopping centers without buying a building?

Investors can own shopping centers without buying a building through REITs, private deals, net lease funds or loans:

• Listed shopping center REITs, whose shares trade daily.
• Private syndications or funds that buy single centers.
• Net lease funds.
• Loans secured by centers.

Listed shopping center REITs that own grocery-anchored centers include Regency Centers, Kimco and Phillips Edison.

Grocery-anchored REITs vs private deals: what is the difference?

A grocery-anchored REIT spreads your money across many centers and lets you sell any trading day. Its price moves with the stock market. A private deal is usually one center, run by one sponsor and held for several years. Its fees and profit split are set in the offering documents.

A private grocery-anchored deal is usually a single-asset syndication, sometimes run with a local operating partner. Each sponsor sets its own minimum and eligibility, and you can compare open offerings on Relli and talk to each sponsor's team before deciding.

The offering documents list the acquisition fee and promote. The guide to sponsor fees explains how to read those terms. A review before listing is not a guarantee of performance, and private real estate is illiquid.

Due diligence

How do you analyze a center's tenant mix and foot traffic?

Analyzing a grocery-anchored center starts with the grocer, then the inline tenants, then the traffic data. Ask the sponsor:

1. Who is the grocer, how strong is its credit, and does it report sales per square foot?
2. How many years are left on the grocer's lease, what renewal options does it hold, and does it own or lease its pad?
3. Which inline tenants have co-tenancy or kick-out clauses, and what triggers them?
4. What share of rent comes from inline shops, and how do their rents compare with market (re-leasing spreads)?
5. How much of the mix is need-based (food, medical, services) versus apparel, banks and other categories exposed to online shopping and closures?
6. What do visit counts from location data show for this store against nearby grocers over the last two years?
7. What are the debt terms, the sponsor's fees and co-investment, and its record with retail?

The guide to evaluating a syndication deal covers the questions that apply to every property type.

Online threat

Is grocery-anchored retail safe from e-commerce?

Grocery-anchored retail is not safe from e-commerce, but grocery is harder to move online than most retail. The cards below cover safety, shadow anchors and leases.