IKEA will close its small-format store in San Marcos on Nov. 1, 2026, just 14 months after it opened along the Interstate 35 corridor between San Antonio and Austin. The 35,000-square-foot shop sits in the San Mar Plaza shopping center.
The closure was reported by the San Antonio Express-News, which detailed that IKEA decided not to renew the lease for the location. In a statement, the company said it continues to evolve as customers' needs change, according to the same report. The San Marcos shop had been IKEA's first small-format store in Texas, opening in July 2025 as part of a push into smaller, more accessible store formats designed to reach shoppers who couldn't easily get to the company's massive warehouse locations.
For scale, the San Marcos store was about one-eighth the size of IKEA's Live Oak location, which opened in 2019 and spans 289,000 square feet. It's also dwarfed by the Round Rock store, which opened in 2006 and covers 306,000 square feet. Rather than the sprawling showrooms of those full-format stores, the San Marcos location offered a small range of IKEA's Swedish food market items and displayed more than 2,500 products, with 2,000 items available for immediate purchase.
Part of a Broader Texas Pullback
San Marcos isn't the only small-format casualty this year. IKEA closed its Plan & order point with Pick-up location at The Domain in North Austin on Aug. 30, 2026, and shuttered an 11,000-square-foot planning studio in Southlake in February 2026, according to TheStreet. The Plan & order point with Pick-up format was introduced in early 2023.
The retrenchment hasn't been limited to Texas. IKEA permanently closed a full-sized warehouse store in Memphis in May 2026, marking the company's total exit from physical retail in Tennessee, and closed a small-format studio in South Charlotte, North Carolina, in August 2026, as reported by Inc. Magazine.
Where Shoppers Can Still Find IKEA Nearby
The San Marcos store had inventory limits, but customers could order IKEA's full product range for pickup or delivery, including items unavailable in the store. That gap in convenience may have undercut the store's core appeal relative to ordering online or making the trip to a full-size location.
IKEA has been building alternative touchpoints instead. In late 2025, the company launched IKEA at Best Buy shop-in-shop planning studios inside select Texas Best Buy stores, including locations in South Austin and Alamo Ranch in San Antonio, with the Alamo Ranch site also serving as a free product pickup hub, according to Best Buy. Those 1,000-square-foot design centers combine IKEA furnishings with Best Buy's major appliances.
Financial Pressures Behind the Strategy Shift
IKEA U.S. reported that fiscal 2025 total revenue declined nearly 0.9% year over year, while retail sales fell 1.1%. Online purchases accounted for approximately 28% of purchases. The fiscal year also involved price reductions, sourcing costs, commodities and tariffs. The company is now shifting focus toward online shopping, home delivery and pickup services rather than expanding small physical footprints, backing that pivot with a multi-year $2.2 billion omnichannel investment strategy aimed at digital infrastructure and delivery logistics.
Company officials have said physical store closures happen when asset reviews reveal misaligned costs or changing shopping patterns — a rationale that fits alongside broader corporate language describing IKEA's operations as including opening new stores, transforming existing ones, and closing locations when needed. The company has invested billions of dollars in U.S. expansion overall, even as it trims underperforming formats.
Despite the wave of small-format closures, IKEA isn't retreating from physical retail altogether. IKEA opened a 93,000-square-foot store in Webster, Texas, near Houston, in June 2026 — a project Hoodline covered when it opened. The strategy suggests IKEA is reallocating capital toward larger markets and full-format concepts rather than the compact suburban pickup points it tested in places like San Marcos.
A Grand Opening Not Long Ago
The San Marcos store's run was brief but not without local goodwill. At its grand opening in July 2025, IKEA presented a $75,000 donation to local flood relief organizations serving the San Marcos community, an event that drew large crowds along the I-35 corridor, according to MySA. Just over a year later, the store will shut its doors, leaving San Marcos shoppers to rely on the full-format Round Rock and Live Oak locations, online ordering, or the emerging Best Buy design centers for their IKEA needs.
