What:

As part of its creditor protection process, Hudson's Bay is divesting its retail footprint through strategic lease sales, with YM Inc. securing five locations and B.C. billionaire Ruby Liu pursuing up to 25 additional sites, while facing legal challenges from landlords.

Why it is important:

The complex process of lease transfers and landlord approvals highlights the challenges facing traditional retailers as they attempt to monetize real estate assets while satisfying creditor obligations and maintaining stakeholder interests.

Hudson's Bay's retail transformation involves the strategic divestment of its store network, with YM Inc. securing five leases for $5.03 million across prime locations including Vaughan Mills, Tanger Outlets in Kanata, and Toronto Premium Outlets. The retailer faced setbacks when unable to secure landlord approvals for three additional locations in Pickering, Saskatoon, and Edmonton. Separately, B.C. billionaire Ruby Liu, who already acquired three leases at malls she owns for $6 million, is pursuing up to 25 additional locations, though facing resistance from landlords questioning her business plan's credibility. The process involves multiple stakeholders, with a dozen bidders making offers on 39 properties, while the company seeks to extend creditor protection from July to October to complete these transactions and conduct art holdings auctions. This complex restructuring aims to recoup funds for lenders and hundreds of creditors owed almost $1 billion collectively.

IADS Notes:

The transformation of Hudson's Bay Company throughout 2024-2025 represents a significant shift in North American retail restructuring strategies. In March 2025, the company initially secured CAD $16 million in interim financing and attempted to preserve six strategic locations while initiating broader closures. However, the situation deteriorated rapidly, reflecting the consequences of a strategy that prioritized real estate assets over retail operations, accumulating nearly CAD $1 billion in debt. By April 2025, Fashion United reported the company's decision to liquidate its remaining seven stores, marking the end of an era in Canadian retail. The contrast between Hudson's Bay's Canadian operations and its US luxury division is particularly striking - while the Canadian parent company liquidates its final stores, its Saks Global division completed a $2.65 billion acquisition of Neiman Marcus in December 2024. This divergence demonstrates how different approaches to retail transformation can lead to drastically different outcomes in today's challenging retail landscape. The current situation, with Ruby Liu's contested attempt to acquire 25 leases and YM Inc.'s successful bid for five locations, highlights the complex interplay between retail operations, real estate value, and market consolidation in modern retail restructuring.

Hudson's Bay reaches deals to sell leases for six of its store locations