What: Hudson’s Bay is seeking court approval to sell 25 former department store leases to B.C. billionaire Ruby Liu, sparking a legal battle with landlords and creditors over the future of these legacy retail spaces.

Why it is important: This case highlights the risks and challenges of department store bankruptcies, as stakeholders navigate conflicting priorities, uncertain business plans, and the evolving landscape of retail redevelopment.

Hudson’s Bay’s plan to sell 25 former department store leases to B.C. billionaire Ruby Liu has ignited a contentious legal battle with landlords and creditors, revealing the complexities of retail restructuring in the wake of bankruptcy. While Pathlight Capital, the retailer’s main lender, supports the $69.1-million deal to recoup its investment, landlords including Cadillac Fairview and Oxford Properties have voiced strong opposition, questioning Liu’s experience, business plan, and the compatibility of her entertainment-focused concept with existing lease terms. The landlords argue that the sale primarily benefits Pathlight at their expense, and warn that Liu’s lack of retail infrastructure and brand recognition could leave them with vacant properties if her venture fails. The dispute underscores the high stakes involved in repurposing legacy department store assets, as landlords seek to reclaim control for redevelopment and creditors push for maximum recovery. The case exemplifies the broader challenges facing North American retail real estate as iconic brands collapse and new players attempt to reinvent the department store model.

IADS Notes:

Hudson’s Bay’s attempt to sell 25 former leases to Ruby Liu amid creditor protection proceedings is emblematic of the complex and often contentious process of department store restructuring in North America. As reported by WWD (March 2025), the company’s bankruptcy filing and subsequent liquidation reflect broader sector challenges, including failed digital investments and the prioritization of real estate assets over retail operations. Inside Retail (March 2025) and BoF (April 2025) highlight how private equity ownership and leveraged buyouts have exacerbated Hudson’s Bay’s decline, with landlords and lenders now at odds over the fate of legacy retail spaces. The Fashion Network (May 2025) details the court-approved lease sale to Ruby Liu, which has become a flashpoint for disputes between Pathlight Capital, landlords, and other creditors, all seeking to maximize their recovery. The Robin Report (March 2025) provides historical context, illustrating how real estate-driven strategies have led to value destruction and operational instability in the department store sector. Collectively, these developments underscore the high stakes and competing interests involved in repurposing legacy retail assets, the risks for landlords and creditors, and the uncertain future for new department store concepts in a rapidly evolving retail landscape.

Hudson's Bay wants to sell leases to billionaire to appease lender's cash demands