IKEA Shopping Centres Russia, whose tenants include major western retailers such as Zara, Adidas and Debenhams, is undertaking a significant refurbishment program at 12 of 14 of its MEGA branded malls located across Russia, and is bringing a brand new food and beverage offer to the “heart” of each mall.
Refurbishment work is being undertaken to ensure they are modern and up to date. And as well as a new food offer, centers are incorporating new entrances, redesigned roofs and upgraded electrics, while extensions are also planned at most MEGAs.
The move sees the developer continue to build the image of its centers as family friendly leisure and retail destinations. More than 261 million visitors come to MEGA shopping centers annually, with families accounting for the highest level of expenditure at 35.7% of turnover.
A key part of the refurbishment program will see more foodservice space than ever before at MEGA Shopping Centres, with a wide choice of restaurants for all tastes and budgets. There is also the potential for fresh food markets in the future.
Food and beverage is becoming an integral part of Russian families’ visits to shopping centers. In addition, the popularity of branded outlets is rising, dining out is growing, interest in foreign food is increasing, coffee shops are becoming temporary offices, and there is more demand for healthy food.
IKEA Shopping Centres Russia believes the changes will ensure it maintains its market leading position, and continues to attract international retailers seeking a “safe entry platform” into Russia. The changes will be implemented by new General Director Armin Michaely. Michaely has just joined IKEA Shopping Centres Russia from Germany where he was Expansion and Property Manager for IKEA Germany.
“Last fiscal year MEGA Shopping Centres were visited by 261 million people, a year on year increase of 3%, while over the last five years footfall has increased by 30%. This year tenant sales grew by more than 10%. We expect the visitation number will grow further because we continuously focus on keeping our offer fresh, and be ahead of consumer expectations,” explains Armin Michaely.
“This is demonstrated by our center upgrade program and our new food offering. Our tenant mix is also carefully choreographed to attract families, with something for everyone. Stores offer toys and clothes for children, sports and electronics goods for men, a wide range of women’s fashion, and of course new furnishing experience with IKEA stores for the family home. In the future we will heavily increase our guest services in addition to what we provide now - baby caring rooms, family parking, playgrounds, and special kids events,” he continued.
MEGA Shopping Centres are highly popular with western retailers entering or expanding into Russia. In the last 12 months the developer has completed new leases with retailers such as Steve Madden, the New York based shoe and accessories retailer, which entered Russia for the first time via a flagship store in Moscow at IKEA’s MEGA Teply Stan. American global lifestyle brand Nautica also came to Russia via IKEA Shopping Centres Russia this summer, taking space at MEGA Dybenko in St Petersburg, as did US retailer The North Face.
Other existing tenants who have extended their leases this year, or have expanded into MEGA Shopping Centres in Russia’s 11 “millionniki” cities include: Jack Wolfskin, Vans, Burger King, Pandora, DKNY, Campo Marzio Design, Disigual and Minelli. Spanish clothing retailer Mango has signed five new leases at five different MEGA’s across Russia including in Ufa, Rostov and Adygea. Adidas has also signed four new agreements in regional MEGA Shopping Centres.
Armin Michaely believes a key reason for the developer’s success is its ability to continuously manage its tenant mix. Because lease lengths in Russia last for an average of 3 – 5 years the tenant mix can be consistently reviewed in accordance with customer demands and IKEA Shopping Centres Russia’s ambitions. A healthy 2% average vacancy rate is purposely kept at MEGAs, to ensure the addition of new best proving retailers can always be considered.
IKEA Shopping Centres Russia has also stepped up its digital offer, communicating with MEGA consumers online and helping retailers by creating multi-channel shopping. MEGA centre tenants can reach consumers with offers via smart phone apps and in-centre Wifi. Dialogue with customers is also built via social media channels including vkontakte – the biggest social network in Russia - , Facebook and Instagram, where IKEA Shopping Centres Russia has over 200,000 followers, and on its new website that has over 500,000 monthly visits.
Source: Aylwin Communications
