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Is Lidl coming to Houston? Brokers not sure anymore

Lidl has kept a low profile in Houston since confirming plans in 2016 to enter the Texas market.

The German-based discount grocer quietly secured several sites across the Lone Star State, fueling speculation about the company’s expansion here. Meanwhile, the grocer opened dozens of stores along the East Coast with plans to open as many as 100 stores and hire thousands of U.S. workers by this summer.

However, several retail brokers told the Chronicle the low-cost grocer has pulled out of some local deals, calling into question its plans for the Bayou City. The privately-held company, which operates about 10,000 stores across Europe, established its U.S. headquarters in Virginia three years ago with high hopes to replicate its success across the pond offering limited, but inexpensive grocery staples.

Christie Amezquita, a broker with Houston-based commercial real estate firm Read King, was working with a client to sell property near Clay and Gessner to Lidl in late 2017 when the grocer abruptly canceled the contract. Amezquita was baffled. She had successfully closed another land deal with Lidl earlier that year. “They just terminated the contract,” Amezquita said. “They didn’t give us any reason.”

David Marshall, co-principal of Houston-based Dosch Marshall Real Estate, said Lidl pulled out of two deals his land brokerage was working on in west Houston and Kingwood last year.

“We heard some rumblings Lidl was dropping, so we didn’t get totally blindsided,” Marshall said. “It was disappointing though. It was a compete 180.”

Ed Wulfe, the founder, chairman and CEO of Houston-based Wulfe & Co., said he believes Aldi — another German grocery competitor with 1,600 U.S. stores — beat Lidl to the punch. Aldi, which has 30 stores in the Houston area, plans to open 10 additional stores this year, Wulfe said. He estimates Lidl has five sites in the Houston area. “Aldi just outmaneuvered Lidl and established themselves here,” Wulfe said. “Lidl is probably thinking it would be more profitable to enter a less competitive market. Houston is a tough supermarket world.”

David Littwitz, a broker with Houston-based Littwitz Investments, said he doesn’t think Lidl is coming to Houston with mounting competition from the likes of H-E-B, Kroger, Walmart and Whole Foods. “I wouldn’t want to come in and challenge H-E-B or Kroger,” Littwitz said.

Lidl spokesman William Harwood declined to comment about its sites in Texas. However, he said the company looks forward to opening more stores. “To date, we have not set any timelines for formal expansion into the state,” Harwood said in an email. “Our operational focus remains along the (East) coast. As I have more to share in Texas, I will be in touch.”

Feb. 2, 2018

Paul Takahashi
Houston Chronicle

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