Ikea plans to construct budget hotels and student accommodation in university cities across western Europe.

LandProp Holding, the Ikea real estate development arm behind the London Strand East project, will develop accommodation under the brand Ulito.

Harald Müller, managing director of LandProp and business development manager of Inter Ikea, said the developments would be on plots not smaller than 26,900 sq ft with 500 to 700 rooms of 190 sq ft spread across several buildings.

Müller also indicated that the firm sees potential for hotels “in all major German cities”.