A number of reasons have been put forward for Target's failure, including supply chain problems, misunderstanding Canadian customers and poor execution. Each of these issues is certainly relevant. However, one stands out to me above all - it's that Target was opportunistic rather than strategic about real estate. Buying up a whole bunch of leases from another chain is inviting trouble, particularly if those leases are in inferior locations (many of the Zeller's locations were) and if the new retailer uses pretty much the same boxes as the ones occupied by the previous retailer (Target did).
In Australia, retailers coming into the market in recent years have typically moved into purpose-built stores in very selective locations. This applies to Costco and to many of the international fashion retailers entering the country and rolling out store fleets. The practice of operating only out of purpose-built stores at premier locations is a sound one and should be continued.
There are exceptions to the rule, as always. For example, a retailer like Aldi might work out okay in a variety of inferior locations and configurations provided it can keep its pricing model intact. Generally, though, each retailer has an ideal set of format and location characteristics that need to be observed, although of course these are often tinkered with a bit to customise them to the industry culture in a new country. As someone in the US location research business, speaking about retailers, told me a long time ago: "No one wants anyone else's boxes." There's a good reason for that, and Target has now learned the hard way.