IKEA Shopping Centres Russia is set to attract a new raft of Western retailers to its shopping centers across Russia where the opportunity now exists to grant new leases at some of the company's MEGA branded malls. And with this in mind, the company's leasing team, will be looking to negotiate significant new deals with leading international retailers.
IKEA SCR is seeking to reinforce the already strong tenant mix at its Russian malls. This provides the perfect opportunity for Western retailers looking to safely enter or expand in Russia, and benefit from the country's fast growing retail market.
IKEA SCR announces a new deal with the Swedish fashion giant H&M which 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, Europe's largest affordable fashion chain is currently present in two MEGA malls located in Moscow and St Petersburg.
Changes to the tenant mix will give consumers a 'fresh offer' and ensure that footfall continues to increase at MEGA malls. Tenant sales turnover at the shopping centers increased by an exceptional 14% in 2011* with footfall also improving by 7% to 227 million visitors.
Håkan Nilsson, Head of Leasing at IKEA Shopping Centres Russia, said: "Constantly updating the tenant mix and improving the concept is a key part of our strategy to ensure that MEGA malls continue to be the leading Russian retail destinations. With leases lasting for an average of five years we can actively asset manage the shopping centers to ensure we get the best possible tenant mix.
"We are interested in talking to western retailers, particularly in the fashion industry so we can introduce our customers to a wide choice of leading brands, which are popular with millions of shoppers around the world. Brand, price, store design, individual collections and overall experience are all important to us.
"H&M is a good example. We noticed that its stores are in demand among MEGA customers so we're very happy to introduce five new H&M stores in MEGA centers meaning the brand will now be represented at eight centers in several Russian regions," Nilsson continued.
IKEA SCR's MEGA Shopping Centres act as a 'safe' launch pad for Western retailers, who are keen to take advantage of Russia's fast growing market where consumers spend an extraordinary 51% of their personal income on retail.
Mark Woodruff, Store Acquisitions Controller at British fashion retailer River Island agrees and commented: "River Island is keen to expand across a number of international markets. In Russia the brand has been very successful since its introduction in 2008. Part of that success has been the development of strong relationships with key landlords who can offer strategic locations from which the brand can build.
"We have developed a good working relationship with the IKEA development team in Russia and they have demonstrated a real desire to understand our brand."
Retailers can establish themselves in the region in the knowledge that each development achieves a critical mass that continuously draws shoppers in very large numbers.
In just 10 years in the market, IKEA Shopping Centres Russia has become one of Russia's leading shopping center developers and operators. Western brands that have taken space at MEGA shopping centers include: American Eagle, New Yorker and Ann Christine, Converse, Zara, Zara Home, Review, McNeal and Berliner, Six, Parfois, Desigual, Oriflame, Wendy's and Victoria's Secret Beauty and Accessories, Adidas, Accessorize, New Look, Reserved and the Inditex group brands Zara, Bershka, Oysho, Stradivarius, Pull and Bear, Zara Home and Massimo Dutti.
IKEA SCR has developed its chain of shopping centers throughout Russia providing about 2 million m² of retail space, and about 70% of its tenants are represented by international retailers. Each mall typically comprises around 130,000 m² with about 200 retailers and an IKEA store as a key anchor and usually inc