We’re sure you have heard the news about Canadian grocery company, Loblaws, purchasing Shoppers Drug Mart for a whopping $12.4 billion. Well, according to CBC News, some analysts believe that this is Loblaws’ way of taking advantage of the thriving condo market in major cities across Canada.

Loblaws’ strategy

The obvious part of Loblaws’ strategy is to gain stronger ground in Canada as big-box, U.S. retailers, like Walmart and Target, continue to focus on offering fresh food products to their clientele. Walmart and Target never used to feature a grocery section, but within the last few years, they’ve really pushed it. Loblaws never focused on offering apparel until they launched Joe Fresh. Now, these three retail giants are battling it out for Canadian consumers. CBC has called it the “Grocery Wars.”

According to Maureen Atkinson, a senior partner at the consultancy, JC Williams Group, there’s more behind Loblaws’ purchase of Shoppers Drug Mart, and it has to do with the Canadian condo market.

Loblaws acquired around 1,200 Shoppers Drug Mart locations across Canada, and the majority of them are located in major urban centres like downtown Toronto, Vancouver, and Calgary. Atkinson believes that today’s condo dweller prefers small, convenient grocery options that offer specialty products. Taking over all the Shoppers Drug Marts in Canada is going to be Loblaws’ way of targeting this demographic. There are many products that Shoppers carried that Loblaws didn’t and vice-versa, and soon, they’ll all be available at a number of convenient locations across Canada’s bustling downtowns.

Another possibility within the condo market

Note: The following is pure speculation, and in no way should it be comprehended as a reliable forecast.

With Loblaws’ purchase of Shoppers Drug Mart, they are probably the largest Canadian grocery/pharmaceutical retailer. As you know, Toronto has been slowly abandoning the purely residential high-rise development typology, and planning mixed-use projects instead. Many new condos are even planning to have grocery stores at street level.

So, wouldn’t it be interesting to see Loblaws partnering with developers to create super convenient downtown condos? Imagine if your building’s elevator had a grocery store button - that’d be pretty amazing.

What do you think? Would you like a Loblaws/Shoppers in your condo? Do you think we’ll ever see Loblaws partnering with numerous developers in major downtown cores?