IKEA's parent company Ingka Investments has signed a conditional purchase agreement to acquire a property at 214 Oxford Street (Oxford Circus) in London – formerly a Topshop flagship. 

The retailer says that part of the vacant space will be used by IKEA UK & Ireland, and was purchased for £378m.

Ingka says the investment, which will see the creation of some 150 new local jobs, supports its retail transformation strategy, bringing IKEA closer to customers by opening new store formats in city locations. The property comprises a total of 22,200 sqm over seven floors, with retail space on six of them. It will host IKEA UK’s second smaller store format, and will follow the opening of IKEA Hammersmith later this winter.

Krister Mattsson, MD of Ingka Investments, says: “We are delighted to have signed this agreement for a property on one of Europe’s busiest shopping streets, and it represents another opportunity to create a more accessible, affordable and sustainable IKEA for our customers.

"This property offers great potential for retail space, and we firmly believe in the long-term value of the real estate market in London."

Peter Jelkeby, country retail manager and chief sustainability officer, IKEA UK & Ireland, adds: “Today we are seeing societal changes that have evolved customer behaviours and the retail industry as a whole. Big global movements in technology, demographics, urbanisation and environmental awareness have caused significant waves of change in the way we live and shop.

“Even though online shopping continues to accelerate at a rapid pace, our physical stores (large and small!) will always be an essential part of the IKEA experience – as places for inspiration and expertise, community and engagement.

“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.”

The new store is set to open in autumn 2023 and will have a focus on home-furnishing accessories, with the full range available to buy for home delivery.