£2m windfall if Sheffield Ikea store given go-ahead

Artist's impression of  Ikea's Meadowhall outlet.
Artist's impression of Ikea's Meadowhall outlet.
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An Ikea store in Sheffield would raise up to £2 million a year in business rates - half of which would be kept by the city council.

And the proposed Next Home store at Meadowhall, refused planning permission by Sheffield Council but now subject of an appeal, could raise at least £600,000 in business rates.

Liberal Democrat leader Coun Shaffaq Mohammed at site of planned new Ikea store in Sheffield

Liberal Democrat leader Coun Shaffaq Mohammed at site of planned new Ikea store in Sheffield

The figures have been revealed after questions were asked by opposition Liberal Democrat councillors.

The Labour-run council and officers are still understood to have ‘serious concerns’ about the impact of traffic from the planned 37,000 square metre store and its impact on city centre retail development.

Liz Orme, Sheffield Council’s assistant finance director, said in a reply to the Lib Dems: “Potential business rates for the proposed Sheffield development could be between £1.5m and £2m.”

Ms Orme added that the business rate valuation is a ‘broad estimate’ and that an accurate figure could not be calculated until detailed plans have been submitted.

She also revealed that the business rates income from the proposed Next Home store at Meadowhall - rejected by the council but now subject of an appeal - would be at least £624,000.

Ms Orme said an estimated valuation for the 5,678 sq metre store could be at least £110 per sq metre.

Coun Shaffaq Mohammed, Lib Dem opposition leader on Sheffield Council, said: “These reports show the real positive impact an Ikea store could have for Sheffield - as well as the 700 jobs it would create.

“Under new funding rules, introduced by the coalition, half of these new business rates would go to the council, meaning more cash to support services.”

Richard Wright, executive director of Sheffield Chamber of Commerce, said: “We should say yes to Ikea and to Next, as well as getting on with the city centre.

“Business rates would bring a huge amount of money for the city which would otherwise go elsewhere.”

Sheffield Council’s Labour administration and senior officials are understood to be divided over the Ikea plans - with some unhappy about the impact of extra traffic and the impact the viability of city centre redevelopment.

There are also fears that allowing the store would ‘open the floodgates’ for expansion of Meadowhall onto surrounding derelict sites.

But other Labour councillors and officers believe the city would be wrong to turn down such a large number of jobs and add that many visitors to Ikea would be going to Meadowhall anyway.

“It is not necessarily the case that the store would bring much extra traffic,” one council source said.

Ikea has given an hour-long, detailed presentation to the council in an attempt to ease concerns.

Coun Leigh Bramall, cabinet member for business, skills and development, said: “Ikea is currently consulting with the general public and stakeholders about the plans for a development in Sheffield.

“When Ikea submits a planning application we will work with them.”