Ikea parent to pay £378m for former Top Shop flagship

Ingka Investments part of the group that owns Swedish furniture retailer Ikea, has confirmed that it is to acquire the iconic former Top Shop building on Oxford Circus in London’s West End and that a price of £378 million (€446 million) has been agreed.

Ingka has signed a conditional purchase agreement for the 239,000 sq ft (22,200 sq m), seven-level building which has retail on six levels.

The building became available following the collapse into administration of Top Shop owner Arcadia Group in November 2020. Eastdil and Savills were instructed on the building which has been sold by the joint administrators of an Arcadia company, Redcastle (214 Oxford Street) Ltd, Ed Boyle and Stephen Absolom of Interpath Advisory (formerly KPMG). Redcastle held a long leasehold interest in the building, the freehold of which is owned by the Crown Estate.

Ikea will use Oxford Circus property for smaller store format

Ingka has confirmed that the building will be the location for the second UK example of Ikea’s smaller store format, the first of which will be located in west London centre Hammersmith and is due to open this winter. Ingka Group has opened stores in Tokyo, Madrid, Moscow, Paris and New York and planning studios in Vienna, Barcelona, Berlin and Prague since 2019.

Krister Mattsson, Managing Director of Ingka Investments said the acquisition of 214 Oxford Street “represents another opportunity to create a more accessible, affordable and sustainable IKEA for our customers”.

Mattsson added that Ingka firmly believes in the long-term value of the real estate market in London. “Securing ownership of properties in prime locations instead of leasing will preserve value on a long-term basis,” he added.

IKEA UK & Ireland’s country retail manager and chief sustainability officer Peter Jelkeby said that big global movements in technology, demographics, urbanisation and environmental awareness have caused significant waves of change in the way we live and shop.

“Bringing IKEA to the heart of Oxford Street – one of the most innovative, dynamic and exciting retail destinations in the world – is a direct response to these societal shifts and an exciting step forward in our journey to becoming a more accessible IKEA,” he said, adding that both large and small physical stores will always be “an essential part of the IKEA experience”.