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Commercial real estate landlords ensure large free spaces when the iconic retailer liquidates liquidates
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Published on March 21, 2025 • Last updated 2 hours ago • Read 5 minutes
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Commercial real estate tenants are taken into account on the possible loss of Hudson's Bay stores. Photo by Darren Calabrese/National Post
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Hudsons Bay Co. went in hand in June 2023 and looked for “incremental liquidity” of landlords, financial institutions and other lenders to support his Canadian operations, but the only one who has on the way was Cadillac Fairview Corp. Ltd.
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Cadillac FairView (CF)-a great real estate player, whose shopping centers are subject to a considerable number of 96 shops in the retail chain that are now exposed to liquidation, apart from a financial contract in the last minute-Hat, a deal that made sense to the fighting retailer, said Jo Taylor, Chief Executives of teachers.
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“If (HBC) could get through the challenges, it would be good for CF because it was an important tenant,” he said, adding that the submission of the HBC after the company of the company arrangement Act (CCAA) was an “unfortunate” development.
“If this size of the tenant clears our shopping centers, we have to spend money on restoring the website in order to actually find new tenants, so continuity is generally better than the transition.”
In the documents submitted in connection with the HBC, which have submitted the research-based restructuring and potential liquidation of HBC, there are mainly Hudsons Bay Stores, in places such as London, Markham, Ontario, and Pointe Clair, Que.
Taylor said there were negotiations before the buying chain extended the loan, which was later reduced to 176 million US dollars after a partial repayment when HBC concluded the purchase of the luxury -us retailer Neiman Marcus last December.
“To be honest, there was more of a admission than an recording in this special case,” he said, referring to the retailer. “We thought about it carefully.”
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The court documents submitted in connection with the CCAA procedure state that interest for the Cadillac credit facility is to be paid monthly and that a interest rate of 10 percent per year arises.
The transaction included two “Mass Leasing Change” agreements, which modified the rights of consent and approval of HBCS “Anker” tenant rights and approval on the renovation of the purchasing center. There was also an obligation that these changes would not come into force, unless there was a failure of HBC that extended over five days and had taken Cadillac FairView measures to enforce the conditions.
“These rights have a significant value together and if these changes to rental contracts can be enforced, these changes for Hudson's bay will be very harmful,” says a document submitted on March 7.
In the documents there were also guarantees in the USA in the original Cadillac Fairview credit contract that were removed when the Neiman Marcus deal was concluded in December and HBC divided its Canadian and US business into separate -financed companies.
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Bladder to landlord
Taylor said that the CCAA process for Cadillac Fairview is not easy, which has rolled up a strategy to reduce exposure to the persistent office and retail segments of commercial properties.
“There will be an impact on the CF team on the loss of an important tenant,” he said, adding that it is too early to say what could come from the costs of submitting HBC and potential liquidation.
HBC has other third -party landlords, including the commercial real estate weapons of other large Canadian pensions.
“I don't believe This is not the first time that Canadian landlords are exposed to the loss of a large retail chain.
“We had Nordstrom, we had Sears, who actually moved away from our shopping centers or other locations, and we were able to find solutions to go forward and still receive a decent performance.”
Riocan Joint Venture
In an HBC press release in December 2024, the Canadian department store was called or leased of a real estate portfolio worth 2 billion US dollars, with some of them in a joint venture with the Riocan Real Estate Investment Trust.
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Riocan Joint Venture, founded in 2015, is described in court documents as the primary Canadian real estate subsidiary of HBC and, according to the real estate company, includes 12 Hudson's Bay Stores.
Riocan has a share of 22 percent in downtown Vancouver and Montreal and in the Yorkdale shopping center in Toronto at 10 of the locations in the joint venture. Two other shops in the partnership are located in the Riookan shopping centers in Oakville, Ontario, and Barrie, Ontario, in which Riocan has a total participation of 61 percent.
A thirteenth location connected to Riokan outside the joint venture is a saking before the 5th shop in Ottawa, in which the real estate trust participates.
In an explanation, Riocan said that it was protecting the interests of its proportions and other stakeholders and there is a success story to find solutions for free space.
“(We) will pursue all available business and legal opportunities to do this,” said Riokan. “In addition, we will use our comprehensive leasing and development skills to achieve the best possible result for every capacity within the joint venture.”
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The HBC has retained a real estate consultant, Jones Lang Lasalle Real Estate Services Inc., until the approval for the Court of Court helps to market IT market lease contracts in its shops and sales centers.
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Kate Camenzuli, Vice President of retail at Commercial Real Estate Services and Investment Company CBRE Group Inc., said that some of the rooms could find new tenants, but they would have to be implemented.
“I do not think there is a forward procedure with one or two users who can take up space,” she said, adding that new tenants probably have to pay more for the place that they include because “anchor” tenants such as the bay usually take breaks because they pull customers into the shopping centers and shopping centers.
“I think the good centers will move, but (it will) under the control of the landlord and they have to be creative,” she said.
• e -Mail: bhecter@postmedia.com
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