Ikea Lands in Downtown San Francisco, Hoping to Beat the Odds

As retailers pack up and depart Downtown San Francisco, the Scandinavian furniture seller Ikea is looking to defy the odds.

Ikea hopes it can succeed in a place where other household name retailers have closed up shop or publicly threatened to leave.

The flat-pack pioneer plans to have the downtown store open by Aug. 23, according to a news release.

Nearly half the stores in San Francisco’s downtown have closed since 2019, according to a May report from the San Francisco Standard.

The report attributes the closures largely to Downtown residents leaving the neighborhood at the height of the coronavirus pandemic.

The stores that have fled the neighborhood include Nordstrom, Old Navy and Whole Foods, according to ABC News.

In a memo to employees when the chain closed two downtown stores, Nordstrom attributed its departure to the “dynamics” of the neighborhood, although it did not elaborate, according to Fox Business.

San Francisco is relatively safe compared to some of its counterparts, with lower rates of violent crime. The homicide rate, for example, is lower than that of sizable American cities like Atlanta, Philadelphia, Houston and Detroit.

But property crime in San Francisco is well above the national average, according to the San Francisco Chronicle. Burglaries are 67% above the average nationwide and motor vehicle thefts are 36% higher.

A poll by the Chronicle last year found that almost half of San Franciscans have personally experienced such crimes.

In spite of the challenges, Ikea has high hopes for the 52,000 square foot space.

“We are so excited to open the doors of our new IKEA store to our neighbors in the San Francisco area,” Arda Akalin, IKEA San Francisco market manager, said in a statement. “We appreciate the excitement and support from the community and can’t wait for our customers to experience the new store full of affordable home furnishings and solutions that reflect who San Franciscans are and how they live.”

The Downtown store is part of a $2.2 billion expansion that includes 17 new stores, including nine pared back stores that focus on casual shoppers. The upcoming San Francisco location falls into that category.

“We do feel it’s a viable place,” Akalin told the Wall Street Journal. “Our ambition going into that location is to bring in more jobs, bring in more people, and bring in more commercial activity to the Mid-Market area.”

The San Francisco store will be Ikea's third Bay Area locations, joining stores in Emeryville and East Palo Alto.