Luxembourg’s Retail Sector Faces Change and New Challenges

Luxembourg’s government has released the Retail Report 2026, showing major changes in the country’s shopping and service landscape. The total retail floor space in the Grand Duchy reached about 1.09 million m² by late 2025, but because the population has grown, retail space per person has dropped to just 1.58 m² — the lowest on record. Some traditional retail formats are shrinking while others grow.

Food-related retail continues to expand, with about 110 new outlets since 2019 and a strong rise in hard-discount stores and international food shops. This reflects changing customer preferences and Luxembourg’s increasingly diverse population. On the other hand, sectors like fashion and home furnishing stores have declined.

The hospitality and restaurant sector shows uneven growth: while fast-food outlets have grown significantly, classic cafés and bars have seen a drop in numbers. This shows how urban consumer habits are shifting.

City centres are also changing. Traditional shops represent a smaller share of city-centre activity, making way for services, dining options and creative concepts like pop-up stores. Vacancy rates have eased somewhat, suggesting stabilization after a period of adjustment.

Officials say the report will help guide policy and business strategies, emphasizing support for digital transformation, flexible retail concepts, and targeted help for small and medium-sized enterprises to adapt to changing trends.

Read more: gouvernement.lu/en/gouvernement/delles-lex/actualites.gouvernement2024+fr+actualites+toutes_actualites+communiques+2026+02-fevrier+23-delles-retail-report.html

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