IKEA, the world's largest home furnishings company, said its Indian entity (IKEA India P Ltd) has acquired a 23-acre land parcel in Turbhe, Navi Mumbai, for its first retail store in the city.
The purchase of Mumbai land parcel is its second one in India after Hyderabad. Strategically located in Navi Mumbai on Thane Belapur Road next to Turbhe railway station, the IKEA store is being planned to be around 4 lakh square feet and is expected to have more than five million visitors per year, the company said in a statement.
When contacted by dna, the Swedish retailer did not share further details including the cost of acquisition pertaining to the transaction. Queries emailed to IKEA remained unanswered. However, in a BSE notification earlier on March 29, 2016, Tata group company Rallis India had said that it has assigned leasehold rights in respect of its leasehold land at MIDC Industrial Area, Turbhe, Mumbai, to IKEA India for a consideration of Rs 213.93 crore.
Juvencio Maeztu, chief executive officer, IKEA India, said Maharashtra is one of the most important markets for the company. "Along with setting up retail stores, we will expand our supplier landscape and grow local sourcing as much as possible. Each IKEA store will employ 500-700 co-workers directly and another 1,500 indirectly, engaged in providing services. We are committed to having 50% women in our organisation at all levels and giving equal opportunities to all. We will bring a unique shopping experience through our inspiring stores offering affordable home furnishing products for the many people in Mumbai," said Maeztu.
In fact, during an exclusive interaction with dna back in September 2014, Maeztu had said the company would be looking at retail space between 350,000 sq ft and 400,000 sq ft for its stores in India. "These will be destination stores with good rail and road connectivity. Each store will call for investments to the tune of Rs 500 crore," Maeztu had said then.
With plans to open 25 stores in India by 2025, IKEA is simultaneously evaluating suitable sites in metro cities like Bangalore, Mumbai and Delhi & NCR. In fact, last year in July, dna had first reported that IKEA was in talks to acquire a 6-7 acre land parcel from BSE-listed real estate company Oberoi Realty. The transaction is expected to be valued at Rs 400 crore. The plot, located at the junction of Western Express Highway and Dattapada road in Mumbai's suburbs of Borivali, is part of the 25-acre land of Tata Steel sold to Oberoi Realty in 2014, in a Rs 1,155 crore e-auction deal.
IKEA, which manufactures and sells home and office furnishing products, had announced plans to invest in single-brand retail trading in India through a 100% subsidiary. The company had in January 2013 received an approval from the Foreign Investment Promotion Board (FIPB) to invest Rs 10,500 crore over 10 years for setting up stores in India. While the furniture retailer has already bought a 13-acre plot in Hyderabad for its first outlet in the country, the company has not given any timeline for the store getting operational.
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