IKEA – the well known and popular furniture retailer – is widely reported to be planning its own chain of as many as 100 budget hotels across Europe, picking up on the demand for economic but ‘stylish’ hotel accommodation that citizenM, Motel One and others have already identified.
This demand has been driven by a combination of reasons, including price-consciousness amongst business and other travellers, raised expectations for design and service, as well as the perceived need for differentiation by hoteliers.
Harald Muller, senior executive at the property unit of Inter IKEA, the company that owns the IKEA brand and concept, is quoted as saying that “Budget designer hotels is today the fastest developing hotel segment.”
Inter IKEA already owns a handful of hotels as real estate investments, but the proposed chain would considerably expand its investment in both real estate and the hotel sector.
The intention, however, is not to use the IKEA brand name – nor its furniture!
The chain is likely to be run by an international hotel operator and first open in Germany, with sites being sought in the UK, Belgium, Austria, the Netherlands, Scandinavia and Eastern Europe.