Allan Saunderson is managing editor of Property Finance Europe and a contributor to GlobeSt.com.

SAMARA, RUSSIA-Sweden's giant furniture retailer Ikea is considering halting its expansion drive into Russia after running into trouble with unpredictable officialdom – although locals say the economic crisis may be as much of a factor as the local bureaucracy.

After opening 11 of its iconic stores in Russia over the last just nine years, Ikea hit a bump when officials in Samara in the Volga River region demanded a planned store be able to withstand near-hurricane-force winds, even though such violent weather is rare. Ikea was due to open the store in May but now says new demands make timing uncertain.

Another blow came when Russia's anti-trust watchdog began investigating the group for allegedly urging tenants at its mall near Moscow to use services of selected firms – an accusation it denies. "Every time there is some kind of inspection, new points come up, so one gets a feeling that someone somewhere does not like us," said Ikea Russia MD Per Kaufmann in a recent interview. "The Russian board today questions whether it's worthwhile to expand further. First we need to open up in Samara, then we will see."

In addition to red tape, corruption continues to obstruct real estate projects of all kinds in Russia – which Transparency International ranks 147th out of 180 countries in its corruptions perception index, and on a level with Syria, Kenya and Bangladesh. Ikea in the past has complained about corruption, asserting it was subjected to blackmail, sabotage and pressure for bribes.

But the weak Russian economy may be another factor in throttling back growth. "The main motivation now is the uncertainty of where the economy is going," said Chris Weafer, chief strategist at Uralsib investment bank. Discretionary income of Russians has declined and consumers are holding off on buying apartments and making renovations.

Kaufmann says Ikea has positive accumulated sales in 10 out of 11 Russian stores with double digit growth for Russia on average. Ikea previously said it had invested more than $3bn in Russia and was planning to open four stores this year. It opened its first store in Russia, outside Moscow, in 2000, and currently employs 7,000 people in the nation.

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