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Furniture retailer paid $198M for the property 18 months ago
IKEA began construction at a long-empty Market Street building, almost 18 months after buying the property.
The furniture company, founded in Sweden and based in the Netherlands, paid $198 million for a mall at 945 Market Street that has been empty since it was completed in 2016, the San Francisco Chronicle reported. IKEA had delayed the opening from September due to the pandemic.
Plans for the 250,000-square-foot shopping center weren’t released. While building permits for about $6.6 million in tenant improvements have been secured, IKEA will probably have to spend more on the total project.
About 70,000 square feet will be for the IKEA store, while the rest will be leased to food, entertainment and other retailers, as well as office tenants.
Other projects near the future IKEA store are in the works. The 186-unit Prism apartment building is set to open at 1028 Market Street this month and Whole Foods is close to opening its largest San Francisco grocery store at Market and Eighth streets.
The developer of a condo building at 950 Market Street, across the street from the future center, said having an IKEA close will attract more residents and retailers to the area.
The new store will be about 25 percent of the size of a typical IKEA showroom, as it is part of the company’s strategy to build compact centers in dense downtown areas. A full range of the company’s furniture will still be available at the new center.
IKEA has 45 mall properties in Europe, Russia and China and is planning to open malls in Toronto, Chicago, Los Angeles and New York.