IKEA To Open 3 New ‘MEGA Malls’ in Moscow

IKEA Centres Russia Director General Milen Genchev said at a press conference on October 3 that IKEA plans to build three new Mega Malls in Moscow to add to its existing portfolio of 3 centres: MEGA Khimki, MEGA Belaya Dacha and MEGA Teply Stan. This is the largest major expansion IKEA has undertaken for 15 years in Moscow, and perhaps reflects the basic rule underlying all retail operations – invest whilst land and property are cheap.

Earlier this year, Chairman of the Board of IKEA Shopping Centres Russia Alfred Zopf said at a working meeting with members of the Government of Moscow: “Moscow’s market is currently one of the best places to develop business in Russia in terms of investment opportunities and optimum tax burden,” Following the meeting Mr Zopf said: “Those who conscientiously pay taxes – which is what we do – observe rational changes in the city’s tax policy. We have serious plans for business development in Moscow; we are ready to develop a series of projects in the capital and are working closely with the Government of Moscow on this.” Russian media reported that an agreement with the Moscow City government has already been signed, and this agreement includes a stipulation that IKEA invest in roads and social infrastructure for its new stores.

The company apparently sees great potential in the east, west and northeast of the city. One of IKEA’s secrets for success has been to build centres on the edges of cities, facilitating the development of customer bases both within Moscow and in adjoining areas of the Moscow Oblast.

The company is exploring opportunities and is open to “all forms of development here, including the purchase of existing shopping centres.” IKEA Centres Russia is at the stage of researching and studying construction sites. “We are considering sites of about 8 hectares, which allows us to develop our plans,” Genchev said.

The company, which currently owns 13 shopping centres in Russia, plans to invest 100 billion roubles in Russia over the next 5 years on the expansion of existing and new shopping centres. The company is also upgrading shopping centres in St. Petersburg and Kazan. In St. Petersburg, the company will invest 23 billion roubles in the construction of a shopping centre ‘MEGA Housewarming’ with an area of ​​150,000 sq. m, which is planned to open in 2021.