Ikea Plans To Build Affordable Housing In Britain

Swedish furniture giant Ikea is pushing for building affordable housing in Worthing, in partnership with BoKlok developer.

The furniture giant is turning to Worthing, a southern town in England with a population of 110,000.

IKEA building affordable housing

Ikea is a popular brand for cost-effective furniture and now it is turning to real estate for affordable homes in Britain. The company recognizes the need for this project as home prices are skyrocketing in Britain for the last ten years. The average cost of the properties in the UK is now £230,776 or $288,019.

Earlier this June 2019, the company revealed its plan to create an affordable housing project. Under the plan, the developer, BoKlok can use the government land rather than selling it off and then charge an annual ground rent. In return, the Worthing council will get 30 percent of the properties to use as affordable housing to rent to local people.

BoKlok is owned by Swedish retailer and construction firm called Skanska. The firm built 11,000 homes all over Sweden, Finland, Norway, and Denmark. BoKlok in Swedish means ‘Live Smart’ and it proves to create affordable housing in different countries.

Worthing will undergo financial analysis for the coming months before the construction starts. BoKlok is said to build about 160 houses on Worthing, with the first homes can be occupied within two years.

“BoKlok was designed the IKEA way: large volumes, low prices. Industrialized production and large volumes—in other words, repetition—cut prices and save time in planning,” said Skanska.

The venture between the Worthing council, IKEA and the developer BoKlok, gives the developer control over the supply chain, land acquisition, factory production, site work, sales, and marketing. In addition, the developer is also known to rely on wood for the construction of homes and doesn’t buy land unless it can be developed right away.