Ikea draws Debenhams to Moscow

Ikea Shopping Centres Russia has lined up UK department store Debenhams for its Mega Belaya Dacha in Moscow. The opening, which is scheduled for September 2012, will mark Debenham's debut in Russia. The announcement follows hard on the heels of a deal with Sweden's H&M to open five further stores at Ikea’s Mega malls across Russia, Håkan Nilsson, head of leasing at Ikea Shopping Centres Russia.

He spoke to PropertyEU during Retail Connection, a networking event for shopping centre developers, owners and retailers which is organised in London annually by the International Council of Shopping Centres (ICSC).

Many international retailers are looking for a 'safe launch pad' into the fast growing Russian market, Nilsson said. 'Our Mega malls provide a familiar environment for foreign retailers in which the perceived cultural and legal barriers have been safely negotiated.'

H&M will open five new stores at Ikea SCR's Mega malls in the 2nd and 3rd quarters of 2012. These will be located in Ekateriburg, Nizhniy Novgorod, Samara, St. Petersburg (MEGA Parnas) and Ufa. H&M is currently present in two Mega malls located in Moscow and St Petersburg.

Since arriving in Russia in 2000, Ikea Shopping Centres Russia has become one of Russia's leading shopping centre developers and operators and has 14 Mega malls throughout the country. In total they provide about 2 million m² of retail space, with 70% of the tenants represented by international retailers.

Each mall typically comprises around 130,000 m² with about 200 retailers and an IKEA store as a key anchor. It usually includes a food hypermarket and a DIY store as well. Russian market accounts for a considerable portion of that figure. In the past few years, Russia has become Europe's largest consumer market with an annual turnover of EUR 466 bn or 7.2% annual growth in real terms.

Retail sales have almost doubled in the past five years and in 2011, sales growth exceeded that of most Western and Eastern European countries. Retail turnover in Russia grew by 2.7% from 2010 to 2011, which was approximately twice that in Eastern Europe (1.3%) and (-0.9%) for Western Europe. Moscow ranks third in Jones Lang LaSalle’s index of the top 10 most attractive retail destinations in Europe, after London and Paris. The index is based on an analysis of 150 leading international retailers within 55 European markets.