Ikea, the secretive but hugely successful budget furniture retailer, is looking to build and develop at least 100 budget hotels across Europe in its latest push into the property market.
Inter Ikea, the company that owns the intellectual property rights of Ikea -- which were last week revealed to be valued at €9bn by the company -- is considering sites across Europe for what it calls "budget design" hotels.
The hotels will not use the Ikea name and will not be run by the Swedish company but by an established hotel operator, according to an executive familiar with the plans. Ikea is also considering building student residences across the continent as it looks for ways to put its cash into long-term businesses in an attempt to earn a good return. Inter Ikea hopes to build the hotels in markets where it is already active in property, such as the UK, Netherlands and Poland, as well as new markets such as Germany. "We will announce within a few weeks the first location for our budget hotel in Germany and we are in talks with hotel operators to rapidly implement our concept," Harald Müller, a senior manager in Inter Ikea's property division, told the Frankfurter Allgemeine Zeitung in Germany. So-called budget design hotels, which offer boutique styling at lower price points, are one of the fastest growing sectors in the industry, with Munich-based Motel One among the best known. It has 39 hotels with more than 8,500 rooms in Germany and is now looking to expand in Europe, including a hotel in Edinburgh in Scotland.
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