Marketing

Ikea's Expanding Empire Includes Hotels and Cities


Ikea is helping Marriott International launch the Moxy hotel line

Photograph Courtesy Marriott

Ikea is helping Marriott International launch the Moxy hotel line

Ikea is world famous for its stylish-yet-affordable prefab furniture. What many people don’t realize is that the ubiquitous retailer is but one branch of the Inter Ikea Group’s ever-expanding, modular design-focused empire, owned by Swedish billionaire Ingvar Kamprad.

On Tuesday, Marriott International (MAR) announced it is partnering with Inter Ikea Group subsidiary Inter Hospitality to open a brand of hip, three-star hotels. The Moxy Hotel line, which will open its first location early next year, aims to appeal “not only Gen X and Y but people with a younger sensibility, for whom contemporary style is paramount,” according to a Marriott press release.

Together, Marriott and Inter Hospitality plan to open 150 Moxys across Europe in the next 10 years, starting in Italy, Germany, Austria, the United Kingdom, Ireland, Belgium, the Netherlands, Denmark, Finland, Norway, and Sweden.

Meanwhile, another Ikea affiliate, called LandProp, has started designing an entire 26-acre section of historic East London. Known as Strand East, the mixed-use plans include apartments, offices, restaurants, and a 350-room hotel. Streets will be for pedestrians and bikes, primarily, while cars will be kept in underground parking lots. It’s been reported that the Ikea city will include an underground system of tunnels that suck away garbage.

London isn’t the only city the company has set its sights on. “While there are similar projects in Poland, Latvia, and Romania, the Swedish company now wants to buy up vacant lots in several western European cities and build entire districts from scratch—including the one in the northern Germany city-state of Hamburg,” reports Spiegel International.

Ikea’s history of going beyond flat-pack furniture stretches back at least as far as 1996, when Kamprad partnered with the Swedish construction giant Skanska to start the company BoKlok, which builds affordable homes that are designed the better to suit a society increasingly made up of single parents, pensioners, and students moving away from home.

The company’s site says that BoKlok homes “have been created through a fruitful collaboration between skilled architects who know how to create comfortable homes and IKEA interior designers who understand how people want to live. They have been designed around factory processes which enables them to be far more efficiently constructed in quality-controlled conditions than would be possible through site-based construction.” Already, 4,000 such apartments have been built at more than 100 locations in Sweden, Denmark, Norway, Finland, Great Britain, and Germany.

BoKlok’s homes are sold through lotteries that take place at Ikea stores. But Ikea furniture and stores don’t always figure into Inter Ikea’s greater plans: Strand East, for example, doesn’t plan to allow any big-box stores into the neighborhood—not even an Ikea. As for Moxy Hotels? They reportedly won’t be furnished with Ikea staples—and that’s probably a good thing. A person can only take so many Karlstad sofas and Billy bookcases.

Cwinter
Winter is a reporter for Bloomberg Businessweek in New York.

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Companies Mentioned

  • MAR
    (Marriott International Inc/DE)
    • $77.43 USD
    • 0.08
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