The flatpack favourite IKEA is proving a winner for Sylvia Park owner Kiwi Property.
Eight months on from the Scandi giant’s arrival in New Zealand, the listed property investment company Kiwi Property revealed in a market update Monday that IKEA is helping to boost foot traffic at its Auckland shopping mall.
The company’s reporting a 25 percent increase in visits to its upper level thanks to the pedestrian walkway connecting the mall with the neighbouring IKEA site, which opened in December last year.
Rather than drawing customers away from Sylvia Park’s other furniture stores, Kiwi Property says sales are up across the shopping centre’s furniture stores.
At Sylvia Park Lifestyle, across the road from IKEA, furniture has been a standout category, says Kiwi Property, up more than 30 percent in June compared with the same month last year, and up more than 15 percent across December to June compared to the prior period.
“IKEA appears to be creating a furniture precinct across the two sites, with shoppers comparing and buying at both,” the company said in its investor update.
Retail consultant Chris Wilkinson, of First Retail Group, said furniture generally is not a growth category right now after the big post-pandemic spend-up on big ticket items, which people aren’t really ready to replace yet.
“This is either new demand, or people are just getting inspired and what’s happened is they’ve created this significant destination value both with IKEA and those other types lifestyle businesses,” he said.
“So it’s likely they’re getting a more dominant share of the market than others that got a lesser collective proposition.”