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The largest anchor tenant at the Coquitlam Center was forced to close the doors.
A mall representative told Daily Hive Urbanized that the lease for Hudson’s Bay Company (HBC) was terminated after the retailer failed to pay the rent.
Hudson’s Bay was Coquitlam Centre’s largest anchor dealer for decades, occupying a 120,500-square-foot space on two levels in the southwest corner of the 914,000-square-foot complex.
The Mississauga-based companies oversee the Coquitlam Mall, with Pensionfund Realty Limited as the owner and Morguard Investments managing the property.
Morguard Investments also operates Abbotsford’s Sevenoaks Shopping Center, where Hudson’s Bay is a landmark, but the department store along with others elsewhere in the Lower Mainland currently remains open.
Daily Hive Urbanized reached out to HBC for further comment.
Few details about Coquitlam’s ownership are available at the moment, but a report from the Toronto Star today indicates that the historic retailer’s troubles are not isolated from the location and that the company may face growing financial problems exacerbated by COVID-19.
According to the report, HBC paid no rent to eight owners in Ontario, Quebec, British Columbia and Florida, based on legal documents. Leases are worth $ 20 million a month in 21 locations.
Inside BC, the owner of the Cherry Lane Mall in Penticton notified their HBC office with an eviction notice last week and filed a lawsuit against the retailer for unpaid rent totaling $ 546,000.
On the same day, HBC filed a lawsuit against Cherry Lane Mall, blaming the owner for the loss of revenue resulting in the inability to pay the rent and seeking court protection from eviction. The retailer’s lawsuit accused the mall operator of failing to adopt health safety protocols and said its sales at the venue fell 47% in the past eight months compared to 2019.
Hudson Bay at the Coquitlam Center. (Google Maps)
In eastern Canada, the owner of Oxford Properties is suing HBC for $ 2.3 million in unpaid rent for two locations in Quebec City and Ottawa. The retailer indicated that its sales at the two locations fell more than 99% in April. Additionally, HBC has reportedly failed to pay rent for its stores in eight of the 11 Oxford-owned malls in Canada, where it has offices.
For HBC’s Hillcrest Mall and Richmond Hill in Oxford, an Ontario judge last month ordered the company to pay 50 percent of the seven-month rent it owed. The owner had filed eviction notices and the dealer complied with the court’s decision.
Until last year, when the retailer was still a publicly traded company, its financial performance and cash flows were known as it was required to release quarterly public updates to investors. HBC went private in October 2019 in a deal that valued the retailer at $ 1.9 billion, including its Saks Fifth Avenue store chain.
In the third quarter of the prior fiscal year, before the company went private, HBC reported losing $ 984 million during the quarter, with comparable sales down 3.4% in Hudson’s Bay, up 0.6%. at Saks Fifth Avenue and up 3.4% to 5th place at Saks Off.
Hudson Bay in downtown Vancouver. (Google Maps)
In 2018, Hudson’s Bay struck a deal with Quadreal Property Group, owner of Oakridge Center, which provides the retailer $ 172.5 million. The deal entered into HBC will use $ 151.5 million to repay its loans and the remaining $ 21 million to furnish the new store within the Oakridge Center redevelopment under construction.
Just last month, HBC announced it had formed a new real estate development arm to generate a new revenue stream by modernizing its stores and other real estate. Such redevelopment projects will create a mix of uses, including office, residential, retail and entertainment. It will maximize the company’s property value, which amounts to 40 million square feet of gross leasable area across North America.
The flagship store in downtown Vancouver is a likely favorite for extracting more value through redevelopment.
The new Silver Room in The Room at the Hudson’s Bay flagship store in downtown Vancouver opened in September 2020. (Hudson’s Bay Company)
Earlier this year, with the pandemic as a factor, HBC announced its decision to close and close its long-standing stores in downtown Edmonton and Winnipeg, but these properties are also being evaluated for their potential of requalification.
As for the impact this will have on Coquitlam Centre’s visitor traffic, its other anchor retailers include Walmart, T&T Supermarket, Best Buy, London Drugs and Sport Chek. Eaton’s and Woodward’s were formerly some of the mall’s early landmarks.
On behalf of the property owner, Morguard Investments was in the early stages of planning a major high-density, mixed-use redevelopment of the 60-acre long-term Coquitlam Center property.
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