SAUGUS — Walmart, the world’s largest retailer, is set to start construction in the fall on a new two-story store planned for Route 1 north, a spokesman said.

“We are proceeding as expected,” said Chris Buchanan, director of public affairs and government relations for Walmart in New England. “Our company is very excited about this project.”

Walmart received a foundation permit to build the 114,244-square-foot store on 18 acres next to McDonald’s. The location, one of the most visible on Route 1, is now being used as a staging area for construction vehicles installing a new 12-inch-diameter iron water main running along the highway.

The Arkansas-based chain last month applied to the Saugus Planning Board to modify its plan to add mezzanine space within the store’s footprint.

“This small increase in size results in the need for some additional parking spaces” to comply with town requirements, Buchanan said.

With wider aisles and lower shelves, the store will be the chain’s newest prototype. It also will have a grocery component. An estimated 100 to 150 construction jobs will be created while the store is built, Buchanan said.

When finally open, projected in the fall of 2013, the store will employ about 125 people, most of them full time, Buchanan said.

The new store represents the Walmart corporation’s second business venture on Route 1 in Saugus. In the ’90s, the chain closed a Sam’s Club store, which stood where a Home Depot now operates.

This time around, Walmart believes it will have a lasting impact on Route 1.

“Our recent internal market studies show us this area is right for Walmart, and having a store with a full grocery division would be an asset to the area,” Buchanan said. “We look forward to serving our Saugus area customers.”