27 Aug 2009 18:48

IKEA to move forward with investment plans for Russia after Samara shopping center opens

MOSCOW. Aug 27 (Interfax) - Swedish furniture and home furnishings giant IKEA plans to move forward with investment plans for Russia after it opens a Mega shopping center in Samara whose opening has been delayed by about two years, Per Kaufman, IKEA's CEO in Russia and the CIS, told journalists on Thursday.

"We are still continuing to search for land plots in various regions of Russia. We believe that, after opening the shopping center in Samara, we will be able to return to drawing up new investment projects," he said.

Stefan Gross, director for real estate and shopping centers at Mega, said that several weeks ago IKEA begin eliminating the problems that have kept the company from reaching an agreement on the opening of the shopping center, which was built more than a year ago.

"We have said that no clarification has been brought to the situation in Samara. It's difficult for us to make plans for further investment. Nevertheless, we aren't stopping the development of projects on which construction has already begun," Gross said at a press conference on Thursday.

IKEA is currently wrapping up construction on a shopping center in Ufa, working on building a store in Mytishchi outside Moscow and is drawing up plans for shopping centers in Voronezh and Saratov.

Construction on the Samara store, which has a total area of 130,000 square meters, began in August 2006. Several dates have been announced for the Mega shopping center's opening - November 2007, August 2008 and February 2009. As a result of the delays, IKEA's expenditures on the store have soared to 8 billion rubles, or two times more than initially planned. The company even had to fire 200 employees in Samara on July 9.

The problems with the Samara store are mainly of a technical nature. IKEA failed to receive permission from a government construction oversight agency.

"The problems revealed concern the safety of people: employees and potential visitors to the shopping center," the Economic Development Ministry said earlier. The Samara regional authorities have said the region is interested in IKEA's investment plans but the problems revealed during the construction of the shopping center must be eliminated.

IKEA manages 231 stores in 24 countries. Annual turnover exceeds 19 billion euros.

In Russia, IKEA manages 12 stores and 14 Mega shopping centers, including in Moscow, St. Petersburg, Kazan, Nizhny Novgorod, Yekaterinburg and Novosibirsk. IKEA has been working in Russia since 2000 and has invested almost $2 billion in the Russian economy in that time.