The Hudson’s Bay Company has received court approval to begin liquidation sales at the majority of its retail stores across Canada starting Monday, March 25. The embattled retailer is moving forward with plans to close all but six of its locations, following a short-lived spike in sales that allowed it to temporarily stabilize operations and repay emergency financing.
The liquidation plan applies to 74 Hudson’s Bay stores, two of three Saks Fifth Avenue locations, and 13 Saks OFF 5TH stores across the country. Clearance sales are expected to run through June 15, with all affected locations to be vacated by June 30.
Although six stores were removed from the immediate liquidation list, the future of those sites remains uncertain as the company continues to seek landlord cooperation and potential capital support to restructure.
The move follows a significant spike in sales over the past week, which has provided the troubled retailer with temporary financial relief. A court-appointed monitor and legal counsel confirmed that the company has generated higher-than-expected revenues since entering creditor protection under the Companies’ Creditors Arrangement Act (CCAA) on March 7.
Six Stores Spared—for Now
In a notable shift from earlier plans to shutter the entire network, six stores have been pulled from the immediate liquidation list:
- Hudson’s Bay flagship at Yonge and Queen Streets in downtown Toronto (176 Yonge Street/CF Toronto Eaton Centre)
- Yorkdale Shopping Centre, Toronto
- Hillcrest Shopping Centre, Richmond Hill, Ontario
- Downtown Montreal flagship store
- CF Carrefour Laval, Laval, Quebec
- CF Fairview Pointe-Claire, Pointe-Claire, Quebec
These locations have seen strong recent performance and may serve as the foundation for a restructured future business—if talks with landlords and lenders yield results quickly. “Sales at the company have exceeded the expectations of both Hudson’s Bay and the monitor,” said Ashley Taylor, legal counsel for Hudson’s Bay, during Friday’s Ontario Superior Court hearing.
On Friday, Saks Fifth Avenue management sent a letter to staff about the liquidation, noting that the downtown Toronto Saks store within the Hudson’s Bay building at Yonge and Queen Street would be staying open for now. The CF Sherway Gardens and CF Chinook Centre Saks stores will begin liquidation on Monday.
$21 Million in Sales Sparks Temporary Relief
Between March 8 and 14, Hudson’s Bay recorded nearly $21 million in sales, about $7.4 million more than expected, according to court filings. The unexpected boost, driven by shoppers seeking deals ahead of formal liquidation events, gave the company the financial capacity to repay its $16-million debtor-in-possession (DIP) loan.
The DIP financing, approved earlier this month, came from a group led by Restore Capital LLC, a division of Hilco Global specializing in distressed retail assets. Hudson’s Bay had previously contemplated seeking a larger $23-million facility, but the improved cash position rendered that unnecessary.
On Friday, the court granted approval for the company to repay the initial $16 million loan in full, marking a rare positive milestone in the retailer’s ongoing insolvency proceedings.
Restructuring Agreement in Limbo
In a development that may shape the future of the remaining six stores, Hudson’s Bay disclosed that it has reached a restructuring support agreement with its senior lenders. However, details of that agreement were shared with other stakeholders only shortly before Friday’s court hearing.
As a result, Justice Peter Osborne of the Ontario Superior Court delayed consideration of the restructuring plan until next week, giving other affected parties time to review the proposed terms.
While the agreement may provide a path forward, Taylor stressed that no final deal has yet been made with landlords or other key players to enable a go-forward business plan. “The company does not currently have an agreement on which it could base a restructuring plan,” said Taylor. “The time to do so remains very short.”
If a solution can be found, there is an opportunity to pull additional stores out of the liquidation. If negotiations fail, the six stores currently exempt could still be added to the liquidation process.
Employee Jobs and Real Estate Impact
The CCAA filing has cast a shadow over the future of more than 9,300 employees, whose jobs are at risk if no viable restructuring plan emerges. The collapse of Hudson’s Bay’s retail network would also leave large real estate voids across the country, particularly in major shopping centres and in a handful of downtowns.
The company had previously sought to save approximately half of its stores, but that plan required rent suspensions and landlord-backed investments—concessions that ultimately did not materialize.
Partial Rent Payments Resume for Joint Venture Properties
In a related move, Hudson’s Bay announced that it now has enough liquidity to pay 70 per cent ($7 million) of the rent owed monthly to properties it co-owns in a joint venture with RioCan Real Estate Investment Trust. The company is also prepared to cover unpaid back rent, reversing an earlier court-approved suspension that had drawn criticism.
“This is a good news day for all the parties,” said Joseph Pasquariello, a lawyer representing RioCan. “Any day without complete liquidation is a good day.”
What Comes Next
The coming days will be critical for Hudson’s Bay as it works to finalize restructuring terms that could salvage at least a portion of its iconic retail brand. The court is expected to revisit the restructuring support agreement next week, which could determine whether the six flagship stores have a future—or face the same fate as the rest of the network.
Until then, liquidation sales will proceed as planned at 90 of Hudson’s Bay Co.’s Canadian stores, potentially marking the beginning of the end for a 354-year-old company long considered a pillar of Canadian retail.
Joseph Pasquariello, legal counsel for RioCan, welcomed the development during Friday’s hearing:
“This is a good news day for all the parties. Any day without complete liquidation is a good day.”
Good news? Tell that to the almost 9300 employees whose jobs still face uncertainty! Perhaps the only good news here is for RioCan, when the unexpected sales were able to cover 70% of the debt that was owed to them in their joint venture! The unexpected sales should not be taken to mean anything other than people looking to capitalize on the downfall of The Bay, by buying up their iconic striped merchandise (and in many cases, trying to resell them for huge profits on eBay)!
I’m surprised no western Canadian stores made the cut. Downtown Vancouver, CF Chinook or Southcentre in Calgary. The West Edmonton Mall location was falling apart… but Southgate in Edmonton was okay. I’m disappointed. Hopefully they can re-introduce themselves to the western market once they get their footing back.
Difficult to know what the parameters were although anecdotally the 6 on the list are strong locations…keeping hope alive that more can be added to the list.
Interestingly, not a single “legacy” Bay on the list – 5 Simpson’s (Queen, Yorkdale, Hillcrest, CF Carrefour Laval and CF Fairview Pointe-Claire) and 1 Morgan’s (Downtown MTL).
Very good analysis there. A few more stores could be added to the list, depending how things go over the next two weeks. If things aren’t sorted, the six remaining HBC stores will also be liquidated (so people REALLY need to shop there over the next few days).
Does anyone know what’ll happen to the Saks stores? Will they be liquidating as well?
I expect liquidation of the 3 Saks Fifth Avenue stores to begin on Monday. It’s a sad end, I’ll be writing about it. It will be interesting to see if a liquidation sale is held at Saks in downtown Toronto, while the adjacent Hudson’s Bay store remains operational with plans to survive a restructuring. There’s a question mark for a very key corner of downtown Toronto.
It’s disappointing that not a single HBC store in the west has survived the preliminary round of cuts. This is a head-scratcher, given that malls such as Richmond Centre, Calgary Chinook Centre, Edmonton Southgate and Winnipeg Polo Park are some of the most productive in terms of sales per square foot in the country. It’s also interesting that this development will leave many malls (including those four) without any major anchor tenants (several will still have junior anchors like Safeway or London Drugs). I wonder if HBC isn’t making the same mistake as Nordstrom Canada, thinking the Toronto market can justify the presence of not just one but three of its stores while there is little to no presence for the chain in most of the rest of the country.
I think it’s because they would have to maintain another warehouse in the West which would cost more money which Hudson’s Bay doesn’t have at the moment.
Very, very sad day in Canadian retail history. Here’s a link to the administration proceedings documents:
https://ised-isde.canada.ca/site/office-superintendent-bankruptcy/en/ccaa-records-search/ccaa-records-hudsons-bay-company-ulc
This is really sad. I don’t know where to shop after this….I love department stores .
Then please support Simons. It’s the last of its kind. If you value a department store style shopping experience, it will soon be the only game in town.