Hudson’s Bay Company ULC, the entity behind the 355-year-old retailer Hudson’s Bay and TheBay.com, has announced that it has been unable to secure the necessary financing to restructure its business, potentially leading to the full liquidation of the retailer. Hudson’s Bay stores across Canada could begin liquidation sales as early as next week, marking the end of an era for the country’s last traditional department store chain.
The company has spent the past week in discussions with landlords to find a path forward but has struggled to reach agreements. The financial strain comes after Hudson’s Bay sought creditor protection under the Companies’ Creditors Arrangement Act (CCAA) on March 7, 2025, in a bid to restructure its operations. However, with only limited debtor-in-possession financing secured, the company now says a store-by-store liquidation process will likely be necessary.
A Retail Giant’s Fall
Hudson’s Bay, Canada’s oldest retailer, currently operates 80 locations across the country, as well as TheBay.com. Through a licensing agreement, the company also oversees three Saks Fifth Avenue and 13 Saks Off 5th stores in Canada. The collapse of Hudson’s Bay would be a devastating blow to the Canadian retail landscape, impacting shopping malls, employment, and consumer choice.
The closure would see the loss of approximately 9,364 jobs across the country, while major shopping centres would be left with the task to fill the large anchor spaces occupied by Hudson’s Bay. Many of these locations encompass multiple floors and represent some of the largest tenant retail square footage in malls nationwide. Ontario would be the hardest hit, with 32 stores and more than half of the company’s employees located in the province.
The Search for a Last-Minute Solution
Liz Rodbell, President and CEO of Hudson’s Bay, said, “Our team has worked incredibly hard to identify a viable path forward, and our resolve is strengthened by the overwhelming support from customers and associates who have shared heartfelt stories about Hudson’s Bay and what our stores have meant to them. These powerful experiences remind us why we must continue to pursue every possible opportunity to secure the necessary support from key landlords and other stakeholders to save The Bay.”
However, with court proceedings expected to approve the liquidation plan on Monday, the timeline for securing an alternative solution is rapidly closing. If no new financial support is found, the liquidation of all Hudson’s Bay stores will begin next week, with final sales events marking the end of the retailer’s storied history.
With Hudson’s Bay now entering the liquidation phase, the retailer has set a firm deadline for the use of its gift cards. Customers will have until April 6 to redeem them, after which they will no longer be accepted. Shoppers can use their gift cards during the ongoing liquidation sales, providing an opportunity to maximize their remaining balances before the deadline. As of February 1, Hudson’s Bay customers collectively held approximately $24.1 million in outstanding gift card value, adding urgency for cardholders to use their funds before they become void.
Negotiations with Mall Landlords Challenging
Sources told Retail Insider this week that Hudson’s Bay, its joint-venture partner RioCan, and mall landlords were engaged in negotiations to determine which stores to keep open. Insiders said that by mid-week, only 23 Hudson’s Bay locations had been negotiated to remain open, far fewer than the initial goal of 40 stores under a restructured business model.
According to sources, Hudson’s Bay has been asking landlords to cover renovation costs and offer financial concessions to keep stores operating. However, some landlords, already frustrated by unpaid rent and financial losses tied to Hudson’s Bay, are hesitant to comply. Some are even prepared to reclaim the anchor spaces for redevelopment rather than continue leasing to the struggling retailer.
Struggles Leading to Collapse
Hudson’s Bay claims that its financial difficulties have been exacerbated by multiple factors, including subdued consumer spending, ongoing trade tensions between the U.S. and Canada, and reduced foot traffic in downtown shopping districts following the pandemic. In reality, much of the company’s struggles stem from years of underinvestment by its ownership, which failed to modernize stores, refresh product selections, and improve the overall shopping experience.
Shoppers have encountered poorly maintained locations with limited staff, broken escalators, and other unresolved maintenance issues. The company also lacked an effective marketing strategy to attract and retain customers, while alienating vendors and not paying them. Cost-cutting measures and prolonged neglect ultimately weakened the chain, leaving it vulnerable at a time when leadership appeared to have cast Hudson’s Bay aside, focusing on the shiny newly formed Saks Global.
Hudson’s Bay owes more than $950 million to an extensive list of creditors, including major fashion brands such as Ralph Lauren, Chanel, Columbia Sportswear, Diesel, and Estée Lauder. Many of these brands have gone unpaid for months, as the retailer struggled to keep up with lease and supplier payments.
The company’s financial turmoil has also led to drastic actions by landlords. According to court filings, a landlord in Sydney, Nova Scotia, forcibly locked Hudson’s Bay out of a store, while bailiffs hired by Cadillac Fairview attempted to seize merchandise from its location in CF Sherway Gardens in Toronto.
The End of Saks Fifth Avenue and Saks OFF 5TH in Canada
The liquidation of Hudson’s Bay would also mean the closure of all licensed Saks Fifth Avenue and Saks OFF 5TH stores in Canada. Saks Fifth Avenue currently operates three locations in the country: two in Toronto and one in Calgary. The Toronto stores, which opened in early 2016, include a downtown flagship spanning three floors of the Hudson’s Bay building and another location at CF Sherway Gardens. The Calgary store, located at CF Chinook Centre, was the last Saks Fifth Avenue to open in Canada. Originally, the retailer had planned to expand to as many as 10 stores nationwide, but growth was halted after the Calgary opening.
The closure will also affect Saks OFF 5TH, the off-price retailer which currently has 13 stores across Canada. The chain, which launched its Canadian expansion in 2016, once operated 18 locations at its peak. However, according to sources, Saks OFF 5TH underperformed in the Canadian market, leading to multiple store closures in recent years. With the liquidation of Hudson’s Bay, Saks OFF 5TH will now fully exit the Canadian market.
A Historic End to an Iconic Brand
Founded in 1670, Hudson’s Bay is the oldest surviving corporation in North America and has played a pivotal role in Canada’s retail and economic history. What began as a fur-trading enterprise evolved into a national department store chain that defined Canadian shopping for generations. The closure of Hudson’s Bay would represent not just the end of a business but the conclusion of a centuries-old legacy.
The retail industry in Canada is at a crossroads, with the disappearance of traditional department stores accelerating in the face of e-commerce growth and shifting consumer preferences. If Hudson’s Bay ceases operations, it will leave a significant gap in the retail landscape, affecting everything from real estate to employment and consumer habits.
As the company awaits its final court ruling and any potential lifelines, Canada watches closely to see if Hudson’s Bay will be saved at the eleventh hour or if it will join Eaton’s, Sears Canada, Woodward’s, Simpson’s, Morgan’s and others in the annals of Canadian department store history.
What’s Happening on Monday:
The Hudson’s Bay Company will appear before the Ontario Superior Court of Justice (Commercial List) on Monday, March 17, 2025, at 9:00 AM, seeking approval for a range of motions that will determine the future of the struggling department store chain. The company is asking for additional financial lifelines and legal protections as it navigates its Companies’ Creditors Arrangement Act (CCAA) restructuring process.
If approved, Hudson’s Bay will have a temporary reprieve to continue operations while selling off inventory, transferring leases, and seeking a potential buyer. If denied, the retailer could be forced into immediate liquidation, accelerating the shutdown of stores across Canada.
Key Requests Before the Court
1. Extension of CCAA Protection Until May 15, 2025
Hudson’s Bay will request an extension of its CCAA protection, which prevents creditors and landlords from taking legal action against the company. The extension would allow HBC to continue restructuring efforts without the immediate risk of eviction from store locations or further financial penalties.
If the court grants this request, Hudson’s Bay will have two more months to execute its turnaround plan. However, if denied, the company could face forced closures and immediate asset liquidation, making it significantly harder to negotiate with landlords and potential investors.
2. Approval of $23 Million in DIP Financing
HBC is also seeking court approval for $23 million in Debtor-in-Possession (DIP) financing, which would provide much-needed capital to keep stores operating in the short term. The funding is being provided by a consortium of lenders, including Restore Capital LLC, Tiger Asset Solutions Canada ULC, and GA Group Solutions, LLC.
This financing is essential for the company’s day-to-day operations, including:
- Paying rent and supplier obligations to keep stores stocked.
- Funding liquidation efforts at stores that will close.
- Covering administrative costs, including legal fees for the restructuring process.
Without this financial injection, Hudson’s Bay would quickly run out of cash, forcing an accelerated shutdown of operations.
3. Approval of a Liquidation Sale Plan
The court will also decide whether Hudson’s Bay can proceed with liquidation sales at select store locations and distribution centres. The company is seeking approval to engage a liquidation consultant to oversee the process, ensuring that remaining inventory and store fixtures are sold in an orderly manner.
If approved, Hudson’s Bay could begin clearance sales as early as next week at affected locations. The sales would run until June 15, 2025, unless extended by the court. However, if the request is denied, Hudson’s Bay may struggle to monetize its inventory, further straining its financial position.
4. Lease Monetization Strategy
Hudson’s Bay is also asking for approval to market and sell its store leases. The company plans to engage a lease monetization consultant to help find businesses interested in taking over leases at various locations.
This process will unfold in two phases, with a series of ten milestones designed to maximize the recovery of value from leases. If approved, the company may be able to generate additional cash flow from lease sales.
If the request is denied, landlords could move to terminate HBC’s leases early, eliminating any chance of recovering value from lease transfers.
5. Sales & Investment Solicitation Process (SISP)
Hudson’s Bay is actively seeking a buyer or investor to rescue part or all of the business. On Monday, the company will ask the court to approve a formal sales and investment process (SISP).
Key deadlines in this process include:
- April 15, 2025 – Deadline for potential buyers to submit bids.
- April 29, 2025 – If multiple offers are received, an auction may be held.
If no buyer emerges, Hudson’s Bay could be forced into a complete shutdown.
6. Financial Protection for Executives & Employees
HBC is also asking the court to approve measures aimed at protecting executives and key employees during the restructuring process:
- Directors’ Charge Increase: The company is seeking to increase executive financial protection from $26.3 million to $49.2 million to shield leadership from personal liability during the bankruptcy process.
- Key Employee Retention Plan (KERP): Hudson’s Bay is requesting $3 million to retain critical employees needed to oversee the restructuring and liquidation process.
These measures are designed to keep leadership and key staff in place as the company navigates this difficult transition.
What Happens if the Court Denies These Requests?
If Hudson’s Bay is denied court approval on any key motions, the consequences could be devastating:
- The company may run out of money without DIP financing, forcing an immediate shutdown.
- Landlords could terminate leases early, pushing HBC out of key retail locations.
- Liquidation sales could stall, preventing HBC from generating much-needed cash flow.
- If the company is unable to find a buyer through the SISP process, Hudson’s Bay could cease operations entirely.
Update: RioCan Could Trigger Liquidation on Monday
Documents filed Friday, and uploaded publicly early Saturday, show that RioCan Real Estate Investment Trust is seeking an order from the Ontario Superior Court of Justice to force Hudson’s Bay to fulfill its rent obligations under their joint venture lease agreements. If the court grants RioCan’s motion on Monday, it could have significant financial and operational consequences for both parties.
One of the core requests in RioCan’s motion is the immediate payment of all outstanding rent owed by Hudson’s Bay to the joint venture properties. Currently, HBC is required to pay rent only to cover head leases, leaving RioCan and the joint venture entities without full rental income. If the court rules in favour of RioCan, HBC would be required to make rent payments for all 12 properties held under the joint venture, amounting to approximately $10 million per month. Given HBC’s existing financial difficulties, this could further strain the company’s cash flow, potentially accelerating store closures and liquidation efforts.
Possible Termination of Joint Venture Leases
Should the court compel HBC to pay full rent and the retailer is unable to comply, RioCan could take steps to terminate lease agreements on its co-owned properties. This would give RioCan greater control over these retail spaces, allowing it to repurpose or lease them to new tenants. However, for major flagship locations such as Yorkdale, Square One, and downtown Montreal, repurposing these massive retail footprints could take years, leaving substantial gaps in some of Canada’s most prominent shopping centres and downtowns.
Impact on HBC’s Restructuring Efforts
HBC has been attempting to restructure under the Companies’ Creditors Arrangement Act (CCAA), seeking court protection while it negotiates with creditors. If RioCan’s motion succeeds, it may limit HBC’s ability to defer rent obligations, making it harder to attract investors or find a buyer for its remaining stores. Additionally, RioCan’s request to block any debtor-in-possession (DIP) financing agreements that prevent rent payments to the joint venture could further complicate HBC’s efforts to secure funding.
Implications for Shopping Centres and Landlords
For shopping centres where RioCan and HBC jointly own properties, such as Oakville Place and Georgian Mall, the court’s decision could impact future redevelopment plans. If RioCan gains the ability to re-lease these spaces, it could look to bring in new retailers or mixed-use developments, reshaping the commercial real estate landscape in these locations.
If RioCan’s motion is denied, HBC may continue to delay rent payments while pursuing restructuring efforts, potentially keeping some stores open longer. However, if the court rules in RioCan’s favour, HBC could face an accelerated timeline for closures and liquidations, forcing landlords to seek new long-term solutions for prime retail spaces left vacant by the struggling retailer.
The outcome of RioCan’s motion will be closely watched by retail industry stakeholders, investors, and landlords across Canada, as it may set a precedent for how creditors and joint-venture partners are treated in large-scale retail insolvency cases. The court’s decision on Monday could ultimately determine whether HBC has a path forward or if it will be forced to exit the Canadian retail market entirely.
Final Thoughts: A Defining Moment for Hudson’s Bay
Monday’s court hearing will be a decisive moment for Hudson’s Bay. If all motions are approved, the company will have a temporary lifeline to continue operations while working toward a possible sale. However, if key requests are denied, HBC could face immediate liquidation, bringing an end to a 355-year-old retail legacy.
The fate of Canada’s last remaining major department store chain now rests in the hands of the court.
Such a sad way for the brand to end!!
It almost feels like the company’s fate was sealed when it abandoned its iconic “B” logo for the bland “HUDSON’S BAY” branding. The stylized yellow B used to repeatedly show up in consumer surveys as one of the most instantly recognizable logos in the country, and the company chose to walk away from it.
Obviously the retailer’s issues were bigger than just foolishly jettisoning a classic logo, but it seems symbolic of a chain that managed to get virtually every decision (even the most visible ones) completely wrong.
I think they should have fully brought back Zellers. I have shopped occasionally at Hudson’s Bay but they were a little too expensive for me. Zellers was always my go to store, I miss it.
With only 3 million in the bank and at least 950 million in debt I would say they waited far too long to file. Combined with the state of their stores I wouldnt’t be surprised to see it just abruptly close in the coming days. It may be up to the landlords to clean up the mess. Hudson’s Bay has become the equivalent of a squatter tenant and the landlords may just want them gone.
How does this happen when the company that owns HBC just spent almost 3 Billion dollars to buy Neiman Marcus. It’s clear that the owner had the money to do this rather than put a fraction the money back into the chain that they bought which allowed them to be able to make the purchase.
It’s clear the parent doesn’t give a $hit about the Canadian side of operations, as it’s done milking this cow.
Makes me wish target could have survived.
I once liked their downtown stores in Vancouver and Montreal, but the suburban ones were as boring as those of Sears. Canada needs its version of La Samaritane where everyone is welcome.!Instead we get Holt Renfrew with its holier than thou attitude. I still haven’t forgiven them for what they did to Olgivie’s.
I’ve popped into our downtown Bay in Montreal a couple of times. The men’s department hasn’t changed, but the women’s seems stuck in the 1970s.
This situation is really sad but not unexpected. Current and past CEOs, senior management and Board members are responsible. The purchase of Neiman Marcus and Saks was a complete waste of money that could have been reinvested in the Bay. What happens to staff now? I’m interested to hear if they will get their full compensation and pensions.
I wish the Court will protect all licensee since HBC was able to collect months of cash as trustee in their license agreement as it is for Hudson’s bay optical
I don’t know what’s sadder. The fact that HBC’s aggressively mortgaged properties likely were funding Richard Baker’s international expansions (and now he’s simply walked away) or how the media (including R.I.), are blaming this on online shopping and the “death of the department store model”. What a sad story of missed opportunities…Canadians deserve better!
I’m going to start being more honest/open with my reporting here as things progress — HBC’s demise is the fault of Richard Baker/ownership and cost-cutting, which left a chain of neglected stores and an inadequate online experience. A pattern of incompetence and sucking the business dry financially all contributed, not to mention dishonesty around vendor relations, and I’ll be diving into this as I speak to more people at HBC (who are starting to reach out with stories to tell).
Craig, the signs were clear when they decided to bring Liz Rodbell back. From 2013 to 2017, she oversaw both the Lord & Taylor and Hudson’s Bay banners, but her merchandising decisions heavily favoured L&T. She pushed American brands—including her husband’s G3 brands—and propped up underperforming labels to strengthen L&T’s assortment, all while flooding Hudson’s Bay with excess inventory. Also, she failed to push back on acquisition of Galeria Kaufhof brands that further overwhelmed the assortments. When her attempts to revive L&T failed, she bailed, leaving it in ruins. Meanwhile, Hudson’s Bay, though still a viable business, was severely neglected, with inadequate capital investment—even for basic upkeep like replacing light bulbs and cleaning carpets. Years of poor American-centric decisions, with no self-reflection, have finally caught up.
355 years….and it only takes one dreamless wonderment, one ahistorical real estate huckster with no connection to Canada or history or anything except the babbittry of real estate to wreck it. Of course, his name has to be kept out of the reporting–except as an afterthought. Baker belongs on Canada’s Most Wanted List. Stop him at the border. I dunno, man. Ya gotta wonder, too, though: Why can’t the moneymen (are there any moneywomen involved in this mess?) of Canada get together and take back this piece of priceless Canadiana from this yahoo?
So very sad but The Bay largely neglected Canadians over the past decade. I would love to patronize The Bay but the pathetic state of their stores, lack of merchandise, seemingly absent staff and unwelcoming atmosphere simply doesn’t earn my money. Some may cry about the “retail apocalypse” but in Metro Vancouver where I live we have the Oakridge Park redevelopment opening in just a few months, The Amazing Brentwood continued expansion, McArthur Glen phase 3 (as detailed last week here at RI), Gilmore Place, The City of Lougheed, plus other projects in the works with substantial retail included. Even the Richmond Night Market site has been approved for a long term redevelopment into a dozen hotels and retail over the long term. Retail is therefore far from dead but the Bay’s intentional neglect of the Canadian consumer isn’t just hurtful; I find it offensive, maddening and embarrassing. The Bay could’ve succeeded, it simply refused to thanks to parasitic management with lecherous intentions to bleed the storied business dry. I guess the only way to Rest In Peace (RIP) is to dig your own grave.
Where did the 1.1billion go from selling the zellers leases no?
$1.8 billion. I’m sure others are asking about monies from the sale of European and other stores owned by HBC in recent memory as well.
Lost in their European experiment in the Netherlands and Germany.
I am obviously old when I say I miss the catelogue shopping. It was a treasure I miss especially the wish books at christmas. As a young girl I loved to see all the new fashions for the next season of clothes. I liked to shop at the bay when the store was in Halifax but I no longer go over to the Dartmouth store. Just too far to go. It will be sad though to see The Bay close its doors for good. I miss all the department stores as they had lots of selection of everything you would need. I miss Sears, Zellers and even the Met stores from days gone by. I do hope The Bay will get a chance at restructuring and remaining in our canadian history.
Thank you, Craig Patterson, for this excellent, thorough reporting. As I read this article, I kept having questions that were subsequently answered in following paragraphs as I scrolled through. You haven’t missed an angle on this event. I also appreciate the commentary from other readers here as they pretty much summed up my thoughts on the matter too. What a mess, it’s just too bad. Perhaps there’s some good to come of it, but at this point, I don’t know what it could be.
Craig this is true reporting and journalism, you are doing fanatic at covering all the news on Hudson’s Bay. Keep it up!
Any news on HBC’s Governor Richard Baker? He drove Canada’s beloved Hudson’s Bay into the ground. 354 years of history soon to be gone at the hands of him. Once that history is gone, its gone. HBC survived so much more in the last 354 years (world wars, the depression, countless economic issues). Yet he managed to destroy Hudson’s Bay & Zellers in 17 years?!?!
Would love to hear insider info over the years from HBC employees. Few of the employees at The Bay this weekend said Richard Baker ignored the Canadian business and starved it of capital for years? Maybe that was his plan from day one? They sold Zellers leases for 1.8 billion, they keep Zellers tradename and all the brand names, sold off all the inventory and assets. Where did that money go? That is billions right there, well over 1.8 billion he got from Target for the leases. He had a failed Hudson’s Bay expansion in the Netherlands back in 2017, why didn’t he invest that capital into HBC stores in Canada?
We all knew this news would come one day, but didn’t think it would come. It brings up a lot of emotions for Canadians. HBC has always been there. HBC is part of Canada and Canadian history, yes some bad and some good history…. but that is any history you look at over the years. Its a company that is well over 350 years old its bound to have history that isn’t well received in todays standards. I hope HBC can be saved but it will never last at the hands of the current leadership/governor.
It will be interesting to see how the millions of square feet of vacant retail will be backfilled or redeveloped. With a lack of large format retailers, I could foresee recreation and lifestyle tenants like pickle ball courts, gyms, rock climbing, VR arcades, escape rooms, dining concepts, etc. fill these spaces and in the process engage the community more with recreation and/or health and lifestyle uses. With crappy weather for large chunks of the year in Canada, more indoor public spaces outside the realm of consumer retail would be nice. Even civic uses like another library branch, educational uses, etc. could be more viable long term. Landlords will hopefully be busy with inquiries.
On another note I hope this closure doesn’t negatively impact the international reputation of Canadian retail. The headlines are so sad that I fear the impression of Canadian retail in the eyes of foreign companies is that Canada is a struggling market, unable to even support a single nation wide department store. A little research (like here at RI) exposes the fact that management and ulterior motives are to blame and that Canada is in fact a nation of consumers. However at the macro level, an foreign brand looking to expand in Canada after seeing this news may give them pause. God help the 9000+ people losing their jobs as well.
Let’s hope Hudson’s bay can keep the 12 store they “own” with the joint venture open. Those seem to be the downtown flagship stores. Maybe they can focus on those and make them great, but it will need a few million for each store to do renovations. Bring them back to a certain standard and stock with merchandise people want.
Sad how Hudson’s Bay was stripped down to the bone and dumped to the side. Does Richard Baker think Canadians are stupid? We all love Hudson’s Bay, yes most of us stopped shopping there because it was so out of touch with customers. But it’s 354 years old, they’ve done something right for centuries. So let’s get back to understand what Canadian shoppers want and need.