Ikea Vietnam, the Swedish furniture giant’s subsidiary in the Southeast Asian country, plans to invest on a EUR450 million retail center and warehouse system in Hanoi, the capital’s chairman has said.

The information was revealed by Nguyen Duc Chung, chairman of the Hanoi People’s Committee, at a conference held by the Ministry of Industry and Trade on Thursday, according to the Vietnam Television (VTV).

The center is expected to become Ikea’s main supply hub for its Southeast Asian market and to boost the Swedish company’s e-commerce business in the region upon its completion, according to Insider Retail Asia.

“At present, all parties involved are in the process of negotiation,” Chung said.

Ikea is now officially present in only three Southeast Asian markets, Singapore, Thailand and Malaysia, according to VTV.

Torbjorn Loof, chairman and CEO of Inter Ikea Holding, said in an interview with Bloomberg in 2017 that the company was planning to expand operation in Vietnam “within five years” from that point.

Ikea has steadily set its Southeast Asian footprint, with the latest largest store planned in the Philippines.

Founded in 1943, Ikea is the world’s largest furniture retailer with 400 stores in 49 countries all over the world. It is known for its ready-to-assemble furniture, kitchen appliances and home accessories

In recent years, Vietnam has been a potential hub for retailers to place their warehouses. Last November, Alibaba-backed online retailer Lazada finished a 4000-square-meter  warehouse in the central Vietnamese city of Da Nang.

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