If current negotiations are successful, Saks Fifth Avenue could be purchased by The Hudson’s Bay Company (“HBC”). Canada could see several Saks Fifth Avenue locations – either free-standing or as Saks shops-in-store within existing Hudson’s Bay locations. HBC has been contemplating a potential Saks purchase for months and we’ve done an analysis to determine some possible locations for Saks in Canada.
Newer American Saks Fifth Avenue stores are generally in the 80,000-120,000 square foot range, about the same size as newly-built Holt Renfrew stores. Saks and Holt Renfrew carry many of the same upscale brands and we would expect label wars if HBC obtains Saks.
Hudson’s Bay has 90 Canadian stores. Several are in Saks-worthy locations. Although we’d only expect Toronto, Calgary and Vancouver to get Saks stores, we’ll do a more comprehensive metro-area breakdown of possible full-line or shop-in-store Saks Fifth Avenue locations via HBC.
Greater Toronto Area
Yorkville: Hudson’s Bay’s 342,000 square foot store at Toronto’s Yonge and Bloor intersection could be at least partially converted into a flagship Saks Fifth Avenue store. The store’s current low ceilings might be remedied by a demolition and reconfiguration of the interior retail space, though this would certainly be an expensive challenge. A Saks Fifth Avenue store on Toronto’s Bloor Street would compete with neighbouring Holt Renfrew, which will see a substantial expansion in the next few years.Â
Downtown: Hudson’s Bay’s 851,000 square foot flagship ‘Queen Street’ store has room for a Saks store, though it would require an awkward reconfiguration of the store’s current setup. We’re not sure if a Saks would be preferable up at the Yorkville Hudson’s Bay while the Queen Street location remains as the primary flagship location for Hudson’s Bay and its related concessions (including a 19,000 square foot TopShop/TopMan and a 20,000 square foot Kleinfeld Bridal, which opens on the store’s seventh floor next year).Â
Yorkdale Shopping Centre: The 303,000 square foot Hudson’s Bay store at Yorkdale has recently seen extensive renovations including Canada’s first full-sized TopShop/TopMan store. If Saks were to carve out, say, a 100,000 square foot portion of Yorkdale’s Bay, 200,000 square feet would still be left for the primary tenant. Saks would see significant competition at Yorkdale from a world-class renovation/expansion of the mall’s Holt Renfrew store, a 188,000 square foot Nordstrom store and possibly the arrival of anchor La Maison Simons.Â
Sherway Gardens: The 223,000 square foot Sherway Gardens Hudson’s Bay could see a Saks shop-in-store. A full-sized Saks is less likely because of Hudson’s Bay’s smaller size. Sherway would be a good move for Saks, as competitor Holt Renfrew will exit Sherway when it opens its Mississauga store in 2016. Nordstrom’s 2016 Sherway Gardens arrival will boost the mall’s popularity and Saks will more likely compliment Nordstrom than provide outright competition, given their limited brand cross-over.Â
Square One Shopping Centre, Mississauga: The 201,000 square foot Hudson’s Bay could see a Saks shop-in-store similar to Sherway Gardens, as discussed above. Despite Square One’s having Target and Walmart as anchors, Saks could actually fit at the mall now that it will include a 120,000 square foot Holt Renfrew store and possibly a branch of La Maison Simons.Â
Calgary
Downtown Calgary: Downtown Calgary’s 450,000 square foot Hudson’s Bay store could see a subdivision to include a Saks Fifth Avenue store. Downtown Calgary already includes a 147,000 square foot Holt Renfrew store that will soon be expanded (article to follow). One major disadvantage to locating within Downtown Calgary’s Hudson’s Bay is the insufficient pedestrian access to the neighbouring Core Shopping Centre that houses Holt’s, Harry Rosen and a substantial number of other retailers. Downtown Calgary’s Hudson’s Bay suffers as a result and won’t see the same renovations, TopShop/TopMan and ‘The Room‘ concepts as seen in Toronto and Vancouver.Â
Chinook Centre: Hudson’s Bay’s 203,000 square foot Chinook Centre store could possibly see some sort of smaller Saks Fifth Avenue shop-in-store. At its present size and with the inclusion of a soon-to-open 15,000 square foot TopShop store, Chinook Centre’s Bay would be too small for a full-sized Saks. It is possible a Saks could open as part of Chinook Centre’s newest expansion proposal, though the expansion appears to lack an additional anchor tenant. A bonus to a Chinook Centre Saks, however, would be less competition from the downtown Holt Renfrew store and increased shoppers drawn to the 140,000 square foot Nordstrom store that will open next year.Â
Vancouver
Downtown Vancouver: The 637,000 square foot Hudson’s Bay store in Downtown Vancouver could see a Saks Fifth Avenue store somehow carved out of its existing store space. Vancouver’s Hudson’s Bay has already seen its space reduced with the opening of one of the world’s largest TopShop/TopMan stores as well as the eventual elimination of the entire sub-basement retail space for one or more tenants (likely not Saks, given its low ceilings and awkward location). A Downtown Vancouver Saks would be in close proximity to an existing (and expected to expand) 137,000 square foot Holt Renfrew and a 230,000 square foot Nordstrom which will open in 2015.Â
Oakridge Centre: Saks has already been inquiring into space at Oakridge Centre (as has Bloomingdale’s). Anchor space at Oakridge could be somewhat flexible and as far as we’re aware, Hudson’s Bay will occupy a newly-built north-anchor space at Oakridge.  A new Saks could be included if proposed Oakridge retail space is reconfigured, or if it secures a new third anchor space at the south-end of the mall.Â
Ottawa
Rideau Centre: A Saks Shop-in-store (or even a smaller full-line Saks) carved out of the 335,000 square foot Ottawa Rideau Street Hudson’s Bay store would compliment Rideau Centre’s Nordstrom store (which will open in 2015) as well as La Maison Simons in the spring of 2015. Competitor Holt Renfrew, located way over at 240 Sparks Street in Downtown Ottawa, would likely see an uncertain future as a result of a Saks in Ottawa.
Edmonton
Finding a suitable location for Saks in Edmonton might be a challenge, though some sort of Saks shop-in-store might work within Hudson’s Bay’s 237,000 square foot Southgate Shopping Centre store. The West Edmonton Mall Hudson’s Bay, at only 164,000 square feet, would likely be too small for any Saks configuration. Downtown Edmonton’s Holt Renfrew, one of the chain’s lesser-performing stores, would only see a reduction in sales with a Saks opening in one of Edmonton’s suburban malls.
Montreal
We’ve consulted with a retail analyst who says they’re not sure if Montreal’s economy or language laws would welcome Saks Fifth Avenue to the city at the moment. Downtown Montreal has a 655,000 square foot Hudson’s Bay store that is currently undergoing renovations to include luxury department ‘The Room’.
Last week we reported that Bonnie Brooks was exiting her role as president of Hudson’s Bay. Could it be she’s in line to run Saks Fifth Avenue? We’ll be discussing this and more later this week as we continue to follow Saks Fifth Avenue’s possible arrival in Canada.
[Saks Fifth Avenue website]
[Hudson’s Bay Company website]
