South African Grocery Retailers to End Exclusive Leases

Major supermarket chains must terminate all exclusive lease agreements by 31 December 2026 to boost retail competition.

Updated on Oct. 22, 2026 in Retail

South African Grocery Retailers to End Exclusive Leases

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Major South African grocery chains face a 31 December 2026 deadline to phase out all exclusive lease agreements. This initiative follows a 2019 Competition Commission market inquiry aimed at dismantling long-standing barriers to competition for retail space.

Why it matters

The Competition Commission seeks to increase market diversity by preventing large chains from locking competitors out of shopping centres. This structural change is designed to create more opportunities for small and medium-sized enterprises to secure prime commercial locations.

The Competition Commission grocery retail market inquiry was published in 2019 to evaluate the impact of exclusive lease practices. Retailers are now prohibited from enforcing these clauses against small and medium-sized enterprises.

The players

Competition Commission

This is a statutory body established in terms of the Competition Act to regulate the South African market and promote competitive practices.

Shoprite

This is a major South African retail group that operates an extensive network of supermarkets across the country.

Pick n Pay

This is a prominent retail chain providing a wide range of groceries and household products throughout South Africa.

Spar

This is a large group of independent retailers operating under a common brand umbrella in the South African food market.

Growthpoint

This is a large South African real estate investment trust that manages various shopping centres and commercial properties.

The details

Shopping centre landlords are currently adjusting their tenant mixes to comply with the new regulatory environment, often introducing multiple supermarket brands to the same facility. Growthpoint has already begun this transition by placing different brands at sites including La Lucia, Watercrest, and Bayside malls.

The Competition Commission published its grocery retail market inquiry in December 2019.
The deadline for the termination of all exclusive lease agreements is 31 December 2026.

Market Landscape

This transition aligns with findings from the Competition Commission grocery retail market inquiry, which identified exclusive leases as a primary barrier to entry for smaller retailers. The move signals a broader shift toward greater competition in commercial real estate.

Shoppers can expect to see a wider variety of supermarket brands within their local shopping centres as landlords diversify their tenant rosters. This could lead to increased options and price competition for household goods as retailers compete for foot traffic.

The takeaway

The end of exclusive leases is set to reshape the landscape of South African shopping centres by fostering a more competitive environment. Residents should anticipate seeing a broader range of grocery options as landlords curate more diverse tenant mixes in the coming months.