Ikea will open on NYC’s Fifth Avenue as owner takes stake in new office, retail tower

An Ikea store will be located in the building’s prime retail space. (Image by KPF)

Ingka Investments, the investments arm of Ingka Group, which owns the majority of Ikea stores worldwide, has invested in the largest development on Fifth Avenue in more than 60 years.

Ingka has taken a stake in 570 Fifth Avenue, a one million-sq.-ft. Class-A retail and office tower being developed by Extell Development Company. The building is scheduled for tenant delivery in 2028.  Financial terms weren’t disclosed. (Eastdil Secured served as the exclusive advisor to Extell on the transaction.)

An Ikea store will be located in the building’s prime retail space of 80,000 sq. ft. It will be arranged over two large cellar levels with a corner entrance on Fifth Avenue.

In a release, the company said the investment is another step in Ingka Group’s strategy to  evolve its retail operations by adapting to urban growth and changing consumer shopping preferences. The initiative involves introducing innovative retail formats in city centers, enhancing accessibility and convenience for customers.

“This next phase of our investment and expansion in the U.S. signals our commitment to bring Ikea closer to people in city centers,” said Javier Quiñones, CEO and chief sustainability officer, Ikea U.S. “While we are in the very early stages of planning for the Ikealocation, we can promise to deliver an experience that is full of inspiration and designed to meet the home furnishing dreams of the many New Yorkers.”  

Ingka Investments will hold a one-third stake in the project alongside preferred equity components and full ownership of the prime retail space where the Ikea space will be located. Extell will hold a two-thirds stake in the project.