Ikea has braved the grueling corporate flight from San Francisco with optimism, opening a new multi-story megastore in the Bay Area city.
The Swedish flat-pack furniture giant seemed to buck a trend of big retailers like Nordstrom and Old Navy closing their stores due to falling pedestrian flows and rising crime.
Cheerful employees dressed in the brand’s iconic colors greeted crowds of shoppers at the Market Street location on Wednesday, with the store adorned with blue and yellow balloon arches.
Yesterday people walked through the 52,000 square meter megastore and filled their baskets. It is located in an empty mall in the city’s bustling downtown.
San Francisco has become a hotbed for drugs and homelessness — resulting in tourists and business travelers staying away from the once-bustling city.
Ikea has defied the San Francisco churn and opened a new megastore in the Bay Area
Yesterday people walked through the multi-storey megastore and filled their baskets
Cheerful staff in the store’s iconic colors greeted crowds of shoppers on Wednesday, while the store was decked out in blue and yellow balloon arches
Despite the optimism, the first day of sales at the Ikea store was canceled due to a fire alarm.
On Wednesday afternoon, shoppers were evacuated and firefighters rushed to the scene of the accident. It is assumed that someone was smoking in the store.
Ikea, known for its warehouse-style suburban stores, is pushing for more downtown stores in the US and promoting its online stores.
Tolga Oncu, head of retail at Ikea store owner Ingka Group, said the company had been strategizing with security firms on how to position the store’s entrance and exit.
They also took measures to stop crime without requiring many guards to be present.
The new small-scale Ikea store is set to expand by next year to include a deli, co-working space and space to be rented by other retailers.
Oncu said: “We are very confident in our city approach, it very much complements our existing Ikea presence in this market.”
“We opened a store in Stockholm’s Gallerian shopping center last year, which has contributed to a 50 percent increase in physical visits to Ikea in a very mature market.”
Ingka Group, the main franchisee of brand owner Inter IKEA, bought the San Francisco location in 2020 and had planned to open the store in fall 2021.
San Francisco has become a hotbed for drugs and homelessness — resulting in tourists and business travelers staying away from the once-bustling city
Ikea, known for its warehouse-style suburban stores, is pushing for more downtown stores in the US and promoting its online stores
Along Market Street and Mission Street, homeless people gather in droves in front of an IKEA store
Wednesday’s opening comes as more shops have fled the area – widespread theft and homelessness have led to even candy shops being locked down.
The Westfield mall announced last month that it had stopped making mortgage payments due to crime and declining sales — it had defaulted on its $558 million loan and returned it to the lender.
This was triggered by the decision by Nordstrom, the mall’s main tenant, to close next month — which Westfield attributed in large part to “unsafe conditions” and “a lack of enforcement action against rampant criminal activity.”
Other big companies like Banana Republic, Office Depot, Old Navy, H&M and Whole Foods Market have either left the area or announced plans to leave in the coming months.
AT&T announced that it will close its flagship store on Aug. 1, in another blow to the city’s struggling retail sector.
Last month, Park Hotels & Resorts announced it was stopping mortgage payments on two hotels, the 1,921-room Hilton San Francisco and the 1,024-room Park 55, saying, “We believe more than ever that San Francisco’s road to recovery.” continues to be clouded and protracted.’ by major challenges.’
An analysis of official figures and other research shows that San Francisco could lose hundreds of millions of dollars from business exodus and a failure to recover from Covid
A family with two young children makes their way through the dirt and squalor at the intersection of Jones and Eddy Streets in San Francisco’s Tenderloin District
On June 16, 2023, people take drugs in front of one of the many empty storefronts in downtown San Francisco
The tourists who keep coming can’t escape San Francisco’s homelessness problem. Here a tour bus drives past a tent city in the Tenderloin area
In downtown San Francisco, homeless people are seen on the streets
The city has also been particularly hard hit by the post-pandemic increase in remote work, which has led to a drop in footfall in the Financial District and Union Square and abandoned office buildings.
Office vacancies reached a record 31 percent in May, enough space for 92,000 workers.
In April, Salesforce announced it would be vacating the eponymous 30-story downtown Salesforce East building, where around 1,000 employees had worked prior to the pandemic.
Leaders expect the situation will result in a budget deficit of $1.3 billion five years from now. The drop in property tax revenues alone could cost nearly $200 million a year, according to a worst-case scenario created by the city’s chief accountant.
The city also faces rampant drug use – many drug dealers openly ply their trade on the streets.
As a result, there were more than 268 drug overdose deaths in the first six months of 2023 alone, according to the city — a 41 percent increase from the previous year.