Ikea buys west London shopping mall for £170m in city centre push
Ikea has bought a shopping centre in west London for £170m and is understood to be looking for more malls in the UK as it makes the most of bargain prices in the crisis-hit retail property market.
Hammersmith’s Kings Mall, which opened in 1980 and has 40 shops including H&M, Primark, Sainsbury’s and Wilko, is the Swedish furniture chain’s first shopping centre in the UK and the first it has taken over. Ikea owns 44 malls worldwide but has built these itself, rather than buying up existing centres.
In October, Ikea said it had bumped up its property team in the UK with the aim of capitalising on the decreased valuations of many shopping centres prompted by numerous closures of high street chain stores.
The company is thought to be looking at further shopping sites across the UK as a way to get its hands on sites for its smaller, more accessible stores in city centre locations.
It is unlikely to face much competition for targets from institutional investors, which are shying away from the retail sector in the face of the rapidly changing market and declining values.
High street closures in 2019
Thousands of high street jobs have been lost this year as a result of high profile retail administrations and thousands more are at risk as Mothercare, Debenhams and Forever 21 prepare for closures. Here are some of the key industry names that have been affected.
Mothercare: Has 79 stores and 2,500 UK retail staff as its British arm prepares to go into administration.
Regis/Supercuts: Had 220 salons and 1,200 staff when it went into administration in October.
Bonmarché: Had 318 stores and 2,887 employees when it went into administration in October. It is still trading as it seeks a buyer.
Watt Brothers: The Scottish department chain had 11 stores and 306 employees when it went into administration in October. All the stores closed and the majority of jobs have gone.
Links of London: With 35 stores and 350 staff, the jewellery chain went into administration on 8 October but its sites are still trading.
Forever 21: Had three stores and about 290 employees in the UK when it went into administration in September. Stores are staying open in order to clear stock.
Karen Millen and Coast: Had 32 stores and 177 concessions, employing 1,100 people, when it went into administration in August. All sites were closed and the vast majority of staff made redundant after the brands were bought out by online specialist Boohoo.com.
Jack Wills: Had about 100 stores and 1,700 staff in the UK when went into administration in August. Bought by Sports Direct and 98 stores are still trading in the UK and Ireland.
Spudulike: Closed all 37 stores with the loss of about 300 jobs when it went into administration in August.
Bathstore: Had 132 stores and 529 staff when it went into administration in June. Homebase bought 44 stores saving 154 jobs and the brand now trades from 28 stores.
Select: Had 180 stores and 2,000 employees when the fashion retailer went into administration in May. In June administrators at advisory firm Quantuma carried out a CVA closing 11 stores with the loss of about 200 jobs.
Debenhams: Had 166 department stores and more than 25,000 employees when went into administration in April. No store closed immediately and the chain is now owned by its lenders but two will close before Christmas and another 20 in January when the group completes a rescue restructure expected to result in the loss of 1,200 jobs.
Pretty Green: Had 12 stores and about 170 employees when Liam Gallagher’s fashion outlet went into administration in March. All but one store and 33 concessions closed with 100 jobs lost but 67 saved as the brand was bought by JD Sports in April.
Office Outlet: All 94 stores have closed with the loss of 1,170 jobs after the stationery retailer went into administration in March.
LK Bennett: Had 41 stores and 500 employees when it went into administration in March. The brand was bought by its Chinese franchise partner, Rebecca Feng, saving 21 stores, all the group’s concessions and 325 jobs. But more than 100 jobs lost with the closure of 15 stores.
Patisserie Valerie: Had 200 cafes employing nearly 3,000 people when an accounting scandal prompted the chain to call in administrators in January. About 70 of the group’s 200 stores closed immediately with the loss of 900 jobs. About 2,000 jobs were saved when about 100 Patisserie Valerie cafes were rescued by Causeway Capital, more than 20 of which have since closed. 21 Philpotts sandwich shops were bought by AF Blakemore & Son. and four Baker & Spice cafes a were bought by the Department of Coffee & Social Affairs. Sarah Butler
The group’s shopping centre arm, Ingka Centres, owns a portfolio of 44 centres in 14 markets around the world, including Russia and China, all of which are anchored by an Ikea store.
Gerard Groener, the managing director of Ingka Centres, said: “Our urban projects are all about getting closer to more people. More of our customers are living in cities than ever before and a regenerated Kings Mall will be an ideal location for reaching millions of Londoners.”
The retailer opened its first city centre site in the UK on central London’s Tottenham Court Road in 2018 and has since opened another in Bromley, south-east London.
Both those sites are “planning studios” that enable shoppers to get advice on kitchen and bathroom overhauls. The Hammersmith store, which will open in spring next year, will be different as it will stock more than 2,000 home-furnishing accessories available to take away immediately.
The company said Swedish food, including its famous meatballs, will be on offer within Kings Mall as part of its plans to redevelop the centre.
Peter Jelkeby, the country retail manager of Ikea UK & Ireland, said: “We continue to respond to people’s evolving shopping habits, making Ikea more convenient than ever before.”