Retail Watchers

IKEA is opening a new smaller format store in San Francisco, California in the downtown area.

San Francisco has very expensive real estate, so a giant IKEA would be too costly. This smaller format store would be an interesting change. The city has many people who do not have cars and would like to be able to go to an IKEA that is closer to them.

This vacant shopping center has 167 parking spaces and the IKEA will take up 70,000 square feet of the 250,000 square foot shopping center. This shopping center has been vacant for about 4 years . The 6X6 Mall is in a very unsavory neighborhood surrounded by homeless tent encampments, drug users on the streets, and various people with mental illnesses. Any store that would dare open in the neighborhood would be a magnet for shoplifting and various bizarre incidents.

Enjoy the neighborhood IKEA!

https://www.sfgate.com/news/article/IKE ... 544275.php

Not a great neighborhood and while it should be high foot traffic I think the space in front of this building is actually rather low foot traffic due to the "issues" around it, but same block as Nordstrom Rack. Gentrification has to start somewhere... this should help that part of the block and all the vacant spaces across the road maybe. I assume Ikea will spend the money necessary to keep the space surrounding its store free of trouble, at least at first.

Maybe this will work.

If the store has too many problems they can just use it to fulfill online orders via delivery or something. I suspect there is high demand for Ikea product in San Francisco.

The Carson IKEA (405 Freeway at Avalon Blvd) is a relic of the 1990's version of IKEA stores. It is still the smallest of their SoCal stores and the only one without a restaurant (just a takeout "Bistro" near the exit).

When IKEA used to be in City of Industry in the late 1990's before moving to Covina, the restaurant was much smaller and adjacent to the entrance, very square and resembled the "cafeteria" typically found inside courthouses! Back then, the restaurant wasn't popular as it is today.

luckysaver

They announced a switch to smaller format stores a few years ago---apparently a response to more shopping going online. They stopped building new stores and put some on hold when they made the announcement, so the size thing is not surprising,

They have more urban locations outside the US, so a downtown store is nothing new for them, just new for the US and they plan several similar stores in NY and Chicago, as well as outside the US. Although this is a failed mall, the comments about the area are a bit hyperbolic--it's next to a Nordstrom Rack and in the next block from the Westfield complex, convenient to BART. It's not like they dropped this closer to the Civic Center which is a bit grimmer. Mission Street (the next block South) has hotels and restaurants on the same block.

Is any progress being made on this new store? It wasn't as of last summer, the building just sits, and the area continues to deteriorate vs. 2019.

IKEA owns the property. As of last fall, they had pushed back the opening to sometime this year because of delays in the buildout.

IKEA has opened "design studios" (no inventory) locations in NYC and will open 2 in LA this spring. One in NYC has closed and is supposed to be relocated while another is still going. These are meant to be their smallest format locations. The SF location seems like it would be a "medium sized" location in their small-medium-large strategy.

The construction officially has begun: https://sfist.com/2022/02/09/that-downt ... struction/

buckguy wrote: ↑February 20th, 2022, 10:05 am The construction officially has begun: https://sfist.com/2022/02/09/that-downt ... struction/

Any opening date announcement? This building has never been occupied. So the "build out" should be more of a "finish" and not take... years. Unless they are stalling.

The plans have been altered and the IKEA will be even larger than before. It will be 87,000 square feet vs the original 70,000. The 6x6 Mall is owned by IKEA sister company Inga Centres. The company still plans to keep 47,522 square feet of office space. Offices throughout San Francisco are vacant. It makes sense to have less office space and more retail as retail is where the profit is right now.

There is still no opening date or progress.

With all of the empty condos and empty offices, IKEA will not have too many customers. Before the pandemic, the offices were filled with rich tech workers. The condos were packed with wealthy people with tons of money to spend at IKEA. Now those people have fled to big houses in the suburbs.

Does an urban IKEA make sense now? It will only be profitable if the people return to high rent San Francisco. That may never happen. The world has changed. The days of tons of wealthy people living in San Francisco is over. The city is abandoned.

Just visited the newly-opened small-format Ikea in Toronto. Main difference was...no warehouse. They even have a cafeteria. They disperse the warehouse for this location to about 2 dozen delivery points scattered throughout neighborhoods in the city centre ( remember that Toronto has multiple suburban conventional Ikea stores) TBH it makes good sense--if you're doing a kitchen you'll just drive out to Scarborough etc to get everything all at once, but for a single Billy bookcase, just order for pickup in your neighborhood tomorrow. The delivery depots are truly neighborhood spots--best analogy would be a Mail Boxes Etc. There was one on CHurch Street, in the village, for instance.