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edition 3 (218)
March 2017
Investment & finance

Colossal plans for a colossal market

Anna Pakulniewicz

Colossal plans for a colossal market
Milen Gentchev, the general director of Ikea Centres Russia

RUSSIA Ikea Russia is planning to build several new shopping centres, extend existing ones and, thanks to this, add several projects to its network of some of the biggest malls in Europe. The company is also to modernise their interiors and food courts and create a chain of Ikea stand-alone stores.

Ikea Russia has recently been working tirelessly on extending its portfolio of Mega shopping centres. At present there are 14 Mega centres in Russia, all anchored by Ikea stores. The extension work is to be carried out in two ways at the same time. “First, we want to expand our existing shopping centres, such as Mega Teply Stan in Moscow. Secondly, we want to add new shopping centres to the portfolio,” explains Milen Gentchev, the general director of Ikea Centres Russia. The Mega Teply Stan centre, which was built in 2002, is to be enlarged to over 200,000 sqm.

Mega opportunities

At present Ikea Russia has three centres in Moscow, two in St Petersburg, and another nine in other big cities in Russia. In Moscow, Ikea Russia would welcome any opportunity to add to its portfolio. “We can buy or build. Moscow is a very dynamic market. However, building a centre from scratch is not always easy. It is difficult to find a visible, accessible 15–16 ha plot available to build a centre on. Nevertheless, we are on the lookout for such opportunities,” reveals Milen Gentchev. St Petersburg is also on the agenda: “We have recently announced the acquisition of a plot in St Petersburg, where we aim to develop our third shopping centre in the city. We are in the early stages of the concept development. It will be one of the biggest malls in Russia: a pan-regional shopping centre in the northwest part of the city,” he claims. “In Moscow there are three locations – the west, east and northeast of the city – where we clearly see the possibility of developing another shopping centre [in the city]. We are aiming to add three Mega centres to the Moscow market,” says the general director of Ikea Centres Russia. At the moment the biggest mall is the 222,000 sqm Mega in Bela Dacia in Moscow, which has 40 mln visitors per year. As Ikea Russia insists, this is one of the biggest centres in Europe, with 370 stores in two buildings connected by a covered bridge. The project has recently been renovated. There are also plans to open Mega centres in Chelyabinsk, Voronezh and Krasnoyarsk.

Stand-alone penetration

Ikea in Russia is also looking to open several Ikea stand-alone stores to penetrate more of the Moscow market. “All the Ikea stores in Moscow are open till 2am. And there are a lot of customers visiting the stores at night,” reveals Milen Gentchev.

The taste of modernisation

“The third goal – and a very important one – of our development strategy is to upgrade the food courts of our centres,” says Milen Gentchev. In Teply Stan in Moscow, a completely new food and beverage concept has opened. This operates under its own brand, Taste Boulevard (Vkusnyi Bulvar). “Usually, a food court in a centre is just fast food,” continues the director of Ikea Centres Russia. “But here we have added slow food, a variety of ethnic foods specific to Russia, international cuisine, and so on. Another Mega to be given an upgraded Taste Boulevard food-court is Khimki in Moscow. We have brought the best restaurants from the city centre of Moscow to this food court. For Russia, in my opinion, this is a pioneering move. You will not find another food court in Russia with such a large number of restaurants. Of course, the fast food is still there, but these brands have introduced their latest concepts that perfectly fit into Taste Boulevard – e.g., McDonalds has come up with a new concept to use more natural materials in its interior design.”

Regional wind of change

The developer also wants to add regional flavours when it comes to the design and architecture of the centres. In Yekaterinburg, close to the Ural mountains, the interiors will feature elements made from natural materials in the mountain style. In Kazan, there will be a more ambient atmosphere, as the Mega there is more fashion-orientated and closer to the city centre. The Kazan Mega already has a new façade, ceiling and corridors. With the work now in its second stage, Ikea is focusing on the food court upgrade. In St Petersburg, a EUR 2 mln investment in a public park next to Mega Dybenko is also planned. Ikea Centres Russia forms part of Ikea Centres, a global organisation that is itself part of the Ikea Group. This business is divided into three regions (Europe, China and Russia). Ikea Centres Russia operates Mega centres that receive 265 mln visitors per year. The company also runs a business centre in Moscow with such tenants as DHL, Volvo and Ford.

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