Ikea China's vice president for real estate purchasing Gao Feng and the vice governor of Hangzhou's Binjiang District Yu Xiao'an have signed a investment letter of intent for a new Ikea store in Binjiang District, Hangzhou.
A representative in charge of the project said that the new Ikea store would be located to the south of Jiangnan Street and to the west of the Shidai Street. Covering a total area of over 80,000 square meters, the construction of the store would be started in 2009. On the completion of the store, it will become a multi-use building with an Ikea store as well as an hotel, offices, and shopping outlets. This will make it a unique one among the over 280 Ikea stores around the world.
Commenting on the negotiation with Ikea, Yu said that it was full of ups and downs. Ikea has strict standards on its stores and even the color of the building has to be decided by its headquarters, not to mention the location and the scale. The Binjiang government started to contact with Ikea from March 2007, but the final site of the new store had not been decided until May 2008. However, Ikea adjusted its strategy one month later and said it planed to build a new model which integrate home furnishing store with shopping center. At the same time, the company wanted to enlarge its real estate area from about 45,333 square meters to 300,000 square meters. After several rounds of negotiation, the two sides agreed on the current 80,000 square meters.
Chen Weiyu, vice director of Binjiang Foreign Trade Bureau, said that Ikea owns 282 outlets around the world and most of these stores are home furnishing stores in low buildings. However, the new Ikea Binjiang store will be in a commercial complex, which means this Ikea store will offer more services to local customers. In addition, the the new Ikea store building may have 30 floors, making it probably the highest Ikea store in the world.