The Warehouse will build its biggest outlet in the North Island in Tauranga, just 3km from where it already has a superstore.
The 9000 sq m store will be the anchor tenant for a $30 million shopping centre due to open on Fraser St at Labour Weekend.
It matchesEastgate in Christchurch and another of the same size is under construction in South Dunedin.
Papamoa has a "big red shed" in its Palm Beach Plaza and there is one on Cameron Rd in Tauranga.
The company's property manager, David Jans, said the 5800 sq m central city outlet was not coping with the heavy volume of customers and could not accommodate the growing range of merchandise.
It was a trend now to build even larger stores, he said. Restricted by its site, the Cameron Rd store could not be expanded.
Ninety-five per cent of customers arrived by vehicle and parking was at a premium in the central city.
Mr Jans said the new Tauranga South site, in the Fraser St industrial area overlooking the Waimapu estuary, was conveniently located with good access.
Plans for "Fraser Cove" shopping centre on the 5.3ha site, between downtown Tauranga and Greerton, received resource consent last week.
Earthworks for the 20,000 sq m mall, which will also have up to 20 retail and food tenants, should be underway within a month.
Developers IMF Westland are a New Zealand company with shopping centre experience, including Westgate in Auckland.
The Tauranga centre will be similar to Auckland's Botany Downs, with attractive planting and more than 800 carparks.
Paul Keane, a director of Retail Consulting Group, the principal consultants for the project, said there was high interest.
A mix of national and regional retailers was planned, along with a seafood restaurant, ethnic restaurants and a cafe.
He said the development would give people a shopping option that was away from the congestion of Tauranga's central business area.
Fraser Cove will be the second large format shopping mall in the Tauranga area.
The Bayfair shopping centre at Mt Maunganui is having a $40 million expansion that will double its size to 27,000 sq m.
