Tenants’ Sales at IKEA’s Shopping Malls Grow 16%

Tenant Sales at IKEA Malls Rise by 16% Amid Expansion

STOCKHOLM (Reuters) – IKEA’s shopping malls business, one of the world’s biggest, said on Monday its tenants’ sales were up 16% at constant exchange rates in the 12 months through August, to 6.6 billion euros ($7.6 billion).

Ingka Centres, which has 47 malls anchored by IKEA stores across Europe, Russia and China and plans to enter North America and India, said footfall was up 1% as visitation fell 13% in Europe due to lockdowns in early 2020 but increased in Russia and China.

The occupancy rate was roughly stable at 94%, it said in an emailed statement. Its leasable area is above 4,000 million square metres.

In the previous fiscal year, footfall was down by almost a quarter and tenant sales down 16% due to the pandemic and the restrictions and lockdowns to curb it.

Similarly to IKEA, Ingka Centres has tweaked its strategy in recent years towards adding smaller urban locations to its big out-of-town malls as it adapts to changing shopping behaviour.

It is hunting for property in major European and North American cities, and in 2020 inked its first such acquisitions, in London and San Francisco.

While IKEA opened its first such inner-city store in 2019, in Paris, Ingka Centres is due to open its first inner-city mall in the coming months, in London.

Managing Director Cindy Andersen told Reuters Ingka Centres’ first opening in North America was now planned for Toronto in 2022, followed by San Francisco later in the same year, after the San Francisco opening was delayed from 2021.

The company said H&M, Fast Retailing’s Uniqlo, Starbucks and Inditex’ Zara were among global brands adding stores in its malls during the year. In all, around 1,000 stores opened.

Ingka Centres, which on Monday inaugurated its latest mall, Livat Nanning in China, is part of Ingka Group, which owns most IKEA stores worldwide. Its centres operate under different brands, such as Livat in China.

($1 = 0.8654 euros)

(Reporting by Anna Ringstrom; Editing by Jan Harvey)