IKEA, the world’s leading home furnishings retailer, officially broke ground Tuesday, June 24, at the site of its future St. Louis store scheduled to open fall 2015. IKEA representatives, Missouri Secretary of State Jason Kander, St. Louis Mayor Francis Slay, local officials and community leaders attended the ceremonial event.
“It’s about time we finally made it to St. Louis,” said Joseph Roth, expansion public affairs manager for IKEA during a press conference held before the groundbreaking.
IKEA has contracted with St. Louis-based S. M. Wilson & Co. to construct the project. The 380,000-square-foot store will be built along the northern side of Interstate 64 and Vandeventer Avenue in midtown St. Louis on nearly 21 acres in the city’s Cortex Innovation District, a $2.2 billion research-park project.
The store is located within a 128-acre redevelopment area that was approved for $167.7 million in Tax Increment Financing (TIF) in 2013, according to Ivie Clay, director of communications and marketing for the St. Louis Development Corporation. In March 2014, the city’s TIF Commission approved a total of $37.1 million in TIF assistance for IKEA – $32 million for the IKEA store and $5.1 million for other redevelopment within the IKEA project area, Clay said.
Over the next 23 years, the duration of the TIF agreement, the store will generate nearly a quarter of a million dollars in new tax revenues, Slay said.
IKEA must abide by the city’s minority participation and workforce goals for construction. The project will follow the mayor’s Executive Order #28, which established goals of contracting 25 percent minority business enterprises (MBEs) and five percent women business enterprises (WBEs). IKEA must also follow the city’s 2009 ordinance #68412, which established workforce goals on city-funded public works contracts of 25 percent minority, five percent women, 20 percent local workforce and 15 percent apprentices.
IKEA is working closely with the St. Louis Agency on Training and Employment (SLATE), which will monitor workforce diversity and inclusion goals on the project. The Disadvantaged Business Enterprise (DBE) Office will monitor minority participation on the contracting side. Howard Hayes, director of minority business development for the city of St. Louis, said he anticipates that IKEA will exceed its goals.
More than 500 jobs are expected to be created during the construction phase. However, construction jobs are short-term and serve only a small segment of the population, said Adolphus Pruitt, president of the city NAACP. He is advocating for inclusion in hiring for the approximately 300 jobs that will be added to the permanent workforce when the store opens.
“Our number one priority is to make sure that those doors are open for minorities,” Pruitt said. “Those are the type of jobs that the people in North St. Louis are looking for.”
First IKEA in MO
IKEA St. Louis will be the only IKEA store in the state of Missouri and the 41st store in the U.S. Most IKEA stores are located on the east and west coasts, though IKEA is starting to bring more of Sweden to America’s Midwest, Roth said. IKEA now has stores in Texas, the Great Lakes, and Colorado, and a Kansas City-area store is on track to open fall 2014 in Merriam, Kansas.
IKEA wishes to bring the shopping experience closer to its customers, Roth said. In the past, local customers who wished to purchase products had to do so online or travel to the closest IKEA stores in the Chicago area.
“There are already over 100,000 customers in St. Louis that buy their IKEA furniture somewhere else,” Slay said. “This will be an opportunity to keep that money in St. Louis.”
And bring money to St. Louis from elsewhere.
“This location affords us a super-regional draw from six states reaching customers in seven metropolitan areas,” said Reed Lyons, real estate manager for IKEA.
There are few retailers that generate the kind of enthusiasm that IKEA does, said Dennis Lower, president and CEO of CORTEX. IKEA St. Louis will draw visitors from as far east as Indiana and Kentucky and as far south as Tennessee and Arkansas, Lyons said.
IKEA represents a reflection of St. Louis values, Kander said.
“Jobs with competitive pay and benefits, an emphasis on renewable energy and sustainable practices, and affordable goods for working families,” Kander said. “These are signs of a race to the top.”
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