Construction of NZ's first IKEA store begins

Ingka group head of retail Tolga Oncu says preliminary opening dates are often subject to change. (file image) Photo: Unsplash

IKEA stores owner Ingka group has announced the official start of construction on its delayed first store in New Zealand, which it predicts will be followed by other outlets as the Asia-Pacific region recovers from the Covid-19 pandemic and macro-economic shocks.

A groundbreaking ceremony and iwi blessing was held at the future store's Mt Wellington site on Friday morning.

In a filing in 2022 the company referred to a proposed opening date of December 2024, but the Auckland store is now expected to open late in 2025.

Ingka head of retail Tolga Oncu told Reuters preliminary opening dates were often subject to change.

"These are long projects so quite often the original intent of when you actually can open doesn't become the reality," Oncu said, adding that the macro-economic situation in the past three years had been extraordinary.

The store will be built over three levels and feature a Swedish restaurant and food market, as well as two full-scale houses as part of its showroom displays. A ground-level carpark will take up the first floor.

Naylor Love has been appointed construction project manager of the site, which will be designed by Australian architects.

Oncu said Asia was a fast growing market - with the latest six-to-eight months showing a positive development - helped by China's reopening after Covid-19.

Asked about possible stores in other parts of New Zealand, Oncu said he did not expect the one in Auckland to be enough.

"So one can expect that IKEA in the long-term is going to continue to look for opportunities to expand in New Zealand," he said.

Although the store will be geographically furthest away from IKEA's main operations in Europe, Ingka said the company could mitigate the logistics impact through existing operations in Australia.

"We have learned how to manage that, how to become more effective, efficient, more sustainable, but of course I can't shy away from the fact that every kilometre comes with a price tag," Oncu said.

Globally, there are more than 450 IKEA stores, most of which are owned by the Ingka group. The rest are controlled by other franchisees.

The group was hard hit by supply chain issues and raw materials costs linked to the pandemic as one of the world's biggest users of wood.

- Reuters / RNZ

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