Arnotts, which doubled space at its Henry Street store in Dublin at a cost of £35 million, is to spend a further £3 million next year on continuing reconstruction.
The company is also examining whether to locate a new store in an out of town shopping centre.
Arnotts officially unveiled the new extended Henry Street store on Wednesday night, having virtually doubled its shopping space to 320,000 square feet. The company's deputy managing director, Mr Vivian Dudgeon, said some peripheral parts of the Henry Street branch would be upgraded in January.
The store, which now straddles Middle Abbey Street, Liffey Street and Henry Street has undergone major reconstruction during the past 18 months. The company benefited from substantial tax write-offs for the work as it was carried out in a tax-designated area.
The premises is now the largest department store in the Republic and is said to be the fourth largest in Ireland and Britain.
Mr Dudgeon said sales are currently running at 7 per cent ahead of last year. "We would like to think we have now lost the image of being a sleepy old department store."
He said the company was now more focused and was going after the younger market. However, he stressed the company was a store for all the family.
The Henry Street/Jervis Street area has seen a huge increase in retail outlets including the Jervis Centre and an extension by Penneys.
Mr Dudgeon said such developments had brought more competition to the area and that initially when Jervis Street opened this time last year, it had affected Arnotts sales.
However, this changed from last January onwards. He said the increased number of outlets had brought more pedestrians to the area.
According to Mr Bill Kelly of Arnotts, 780,000 pedestrians passed through the Henry Street area between October 28th last and November 3rd.
The new Arnotts has a number of concession shops including Benetton and Ladybird children's clothing as well as the new SKY Television clothing range. The Manchester United shop has been retained.
Around 60 per cent of the store's shopping area is being retained by Arnotts, while 40 per cent is given to concession shopping space.
Arnotts has also kept its furniture store space and it now covers 75,000 sq ft. Arnotts now houses O'Hagan Design, an increasingly popular furniture brand.
Mr Kelly said Arnotts was providing an option for people to do all their shopping under one roof. He said people still like to come into the city centre to shop. "They see it as an event," he said. "The city centre still leads the way in shopping terms."
Mr Kelly said the concession shops give an added dimension. "In retailing you have to keep moving very quickly," he said. "You are passed by very quickly if you stand still."
Arnotts has also added a car park with space for 200 cars. Other facilities include a one-hour photo shop and a flower shop.
Asked if Arnotts would take space in any of the outlying areas, Mr Dudgeon said it would investigate anything that comes on the market. He said he understood that extensions would soon be added to Blanchardstown and The Square in Tallaght and Quarryvale.
However, he declined to say what specific projects Arnotts was looking at. "We are actively looking at everything at the moment," he said. He added it was unlikely that Arnotts would look at locating a store outside Dublin.
Further work on revamping the Henry Street store will begin in January and will feature 14,000 sq ft of space for young people's fashion and accessories.
Company secretary, Mr Andrew Knowles, said the firm will cope with the necessary borrowings for all the work over five years. At no stage will gearing exceed 40 per cent, he said.
