Economy

Inter IKEA taps commercial property in China

By Liu Yiyu (chinadaily.com.cn)
Updated: 2009-11-24 18:53

Inter IKEA Center Group (IICG), a joint venture with IKEA Group, the largest furniture retailer in the world, plans to tap into China’s commercial property market and invest as much as $1.2 billion in the next five years, IICG said Tuesday.

"IICG is now expanding to China as its first stop outside Europe with two regional shopping center projects, one in Daxing District of Beijing and the other in Wuxi, a booming city in Jiangsu province," John Tegner, managing director of IICG, said in a press conference Beijing.

Tegner said IICG would finalize its third project in China within the next six months, possibly in Shanghai or some city close to tier-2 cities. The company has 22 projects in the pipeline in Europe and China.

Tegner said IICG is building and managing shopping centers for many companies and is trying to be in the middle and lower levels in terms of price.

IICG's to-be-developed Beijing mall, with 200,000 square meters of retail space, is scheduled to open in 2014. The company expects annual visitors to reach 20 million, said Ding Hui, the IICG's managing director for China.

IICG's shopping malls will feature IKEA's products. Though China only accounted for 2 percent of IKEA's revenue last year, IICG is very confident of its long-term strategy in China.

"For the coming decades, we see huge potential in China based on the country's GDP prospects and Chinese consumer confidence, and there is big interest among European retailers who want to come to China," said Tegner.