Getting Ikea to think outside the big box

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Good afternoon,

A long-running Facebook site is facing the realities of riverfront development.

For half a decade the Bring Ikea to the Wilmington, Delaware Riverfront page has banged the drum for the Swedish furniture giant to bring one of its gigantic stores to the area.

After nearly departing the U.S. market in the early going, Ikea has steadily expanded across the nation, but not to cities the size of Wilmington.

The North American arm of Ikea, which is based north of Philadelphia, typically locates stores in outer suburbs or brownfield sites. One example is the Philadelphia store in a redeveloped area near the Delaware River.

Often, the retailer gets the property at little or no cost, since cities get a ton of sales tax revenue in return. Other than payroll or gross receipts taxes, Delaware would not gain that benefit.

So far, Delaware’s lack of a sales tax and a sizable number of out of state shoppers has not led to signs the company would consider the northern part of the state.

A limited amount of land, zoning, drainage and other issues make the process of building big box stores difficult, even when the Riverfront was largely undeveloped.

The most recent post conceded that chances for the store are diminishing as new hotels and the home of a minor league basketball team sprout up on remaining tracts in Wilmington.

Of late, Ikea has been taking a hard look at its big-box strategy and growing competition from online and specialist brick and mortar retailers, the Container Store, which has a location near Christiana Mall.

In the works are smaller urban stores, with the company planning to open a location in crowded Manhattan to complement its big boxes in Tri-State locations.

Meanwhile, it has canceled a few store projects in mid-sized U.S. markets.

With that said, there are still sites in or around the riverfront that could handle an Ikea, especially if the privately held company later opts for a smaller format, a real possibility in this era of one-day delivery and online competition.

Have a great day. Our last newsletter for the work week returns tomorrow. – Doug Rainey, chief content officer.

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