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World-famous Austin gelato shop gets scooped out of Rosedale due to rising rent

Famous Austin gelato shop gets scooped out of Rosedale due to rent

Teo Gelato cone
Tèo is saying addio to its Central Austin shop. Photo by Duc Hoang

Here's a sad scoop: Tèo Gelato is closing. After nearly two decades offering sweet treats from its 38th Street storefront, the Austin-based purveyor is shutting down citing a rise in rent. But, in the spirit of "turning lemons into lemonade," Tèo is using the setback to inspire a renaissance moment for the company.

Citing rising rents, the company is closing its shop at 1206 W. 38th St. on Friday, January 31. In a combination farewell/celebration, Tèo Gelato is offering free scoops on Friday beginning at 9 am until supplies run out.

Tèo Gelato was founded in 2002 by Matthew Lee and quickly garnered a reputation for its high-quality gelato in unique, sometimes quirky flavors. In the decade after opening the shop in the 26 Doors shopping center, Tèo's reputation continued to flourish, until the company was thrust into the international spotlight in 2014.

In September of that year, Lee was invited to participate in the Gelato World Tour Finals in Rimini, Italy, along with the best gelato makers in the world. During that competition, Lee and his whiskey pecan caramel gelato were named among the five best in the world.

Over the past six years, the company has continued to grow, and today it is available in 120 H-E-B and Central Market stores across Texas. In a January 27 release, Lee says that while the closing is certainly sad, it may also free up resources for the company to expand. 

“The rent increase is allowing our team to focus on growing Tèo throughout the U.S.,” said Lee. “We first launched in grocery stores four years ago and it’s been gangbusters constantly having to restock the shelves. We are excited about this new chapter and look forward to getting Tèo in the hands of gelato lovers across America. Tèo was born and raised here, and we couldn’t have done it without Austin’s help.”