Dive Brief:

• Ikea on Tuesday announced it will open a location in New York's Queens borough in summer 2020, according to information emailed to Retail Dive.

• The location (about one-third the size of its warehouse-like Brooklyn location, at 115,000 square feet) will be a "new store concept," the company said. Though consumers can purchase "thousands" of Ikea products at the store, "larger furniture items will be on display and available for convenient delivery."

• The store announcement comes as the Swedish furniture retailer announced on Wednesday that its annual sales exceeded 40 billion euros for the first time.

Dive Insight:

The Queens store will mark Ikea's third location in New York City, indicating the retailer is going all-in on its plan to enter urban markets. In addition to its Brooklyn location, the Swedish retailer in April opened its first U.S. urban planning studio in New York's Upper East Side, spanning just 17,350 square feet.

"With a growing community of more than 900,000 households, Queens was a natural next destination for IKEA in New York City," Leontyne Green Sykes, chief operating officer for Ikea Retail U.S., said in a statement. "We know that more than half of Queens' residents travel via public transportation, and we selected Rego Park for this new store concept to meet the unique needs of this customer."

What differentiates the new Queens store concept from the urban planning studio is the fact that consumers have the ability to purchase items from the store (excluding larger pieces). The planning studio serves as a true showroom where Ikea associates would direct customers to complete their orders online and have products delivered to their homes. The relatively new focus on its digital unit helped drive a 43% growth in e-commerce sales, and push the retailer to closing out the year with a record 41.3 billion euros in revenue. 

Another differentiator is food, which was notably missing when the retailer announced its urban planning studio concept. While it likely won't be as elaborate as the dining experience in traditional Ikea stores, the company said the Queens store will have a "new food offering to allow guests to enjoy a modern taste of Sweden on the go."

The move further adds to the notion that Ikea sees urban millennials as a key demographic. In June, the retailer announced a partnership with U.S.-based startup Ori to sell robotic furniture designed to maximize functionality in tight living spaces, and before that the retailer announced it would begin testing furniture leasing in 30 markets in 2020.