The Cardiff-based facility in Wentlog , near Cardiff, will supply stores in south Wales as well as south west England.
More than 400 staff will be employed at the distribution centre and a further 100 will be employed in the 10 new stores Aldi plans to open in Wales in the next five years, the discounter said.
Aldi’s investment in Wales was secured by a £4.5M business finance deal from the Welsh government, it added.
The funding allowed Aldi to prepare the ground for construction, said Welsh economy minister Edwina Hart.
‘Not have been viable’
“Unforeseen ground conditions and hydrological and ecological constraints means the construction of the new centre would not have been viable without funding support,” she said.
The 40,000m2 centre will create indirect jobs within the wider supply chain for food and beverage suppliers, Hart added.
An Aldi spokesman said: “We are delighted to have the support of the Welsh government and to be creating over 400 new jobs in Cardiff, underpinning Aldi’s commitment to Wales.
“We are pleased to be able to offer more people the chance to shop at Aldi and benefit from our everyday low prices and high quality products.”
Construction on the site is underway and is expected to be completed in 2017. It will include a 3,000m2 office complex, as well as 250 car parking spaces, loading bays, a gatehouse and access roads, Aldi said.
Meanwhile, Lidl announced this week it would create 500 new jobs if its proposed West Midlands 41,806m2 distribution centre was given approval.
The facility will be Lidl’s second in the region and would form part of the company’s plans to create 2,500 new jobs as part of a £220M UK expansion plan announced last year.
If given approval , the distribution centre would be Lidl’s eleventh in the UK and would be located near the M6 in Wednesbury, Wolverhampton, Lidl said.
Ingo Fisscher, a Lidl UK director, said: “The new Lidl warehouse will help service our stores the West midlands as our expansion across the UK continues.”