Greek accessories and jewellery company Folli Follie will continue to open more Canadian shops. The latest will be a location on the 2nd floor of Holt Renfrew‘s Calgary store, according to a source at the Vancouver store. The Calgary shop will be located in the women’s ‘contemporary’ department, and is expected to open mid-August.
Its first Canadian location opened within Vancouver’s Holt Renfrew store in October 2011. Concessions have followed at Holt Renfrew’s Bloor Street and Sherway Gardens stores in Toronto, as well as a location at the Vancouver International Airport.
Folli Follie’s prices are considered relatively ‘affordable’ by designer-goods standards. We enquired why the concession was at Holt Renfrew rather than Hudson’s Bay. Were informed it is because Folli Follie is owned by the same company as Links of London which already has concessions at Holt’s stores across Canada.
We previously reported that West Edmonton Mall could get a Saks store, though possibly not within its Hudson’s Bay department store. West Edmonton Mall’s Hudson’s Bay is only about 164,000 square feet, and a full-sized Saks would ideally be in the 75,000-130,000 square foot range. We’re not yet sure if Saks will open smaller boutiques within existing Hudson’s Bay stores.
West Edmonton Mall is a family owned shopping centre. It therefore may have the flexibility to make deals with retailers that others malls might not. Ghermezian made concessions to open La Maison Simons and we’re told that Simons is doing gangbusters sales. Given the flexibility and previous efforts to secure tenants like Simons, we might see similar efforts put forth for Saks.
The Globe & Mail reports that West Edmonton Mall now achieves sales of about $745 per square foot, up from $450 five years ago. Ghermezian expects sales of $1,000 per square foot within the next few years. Given these numbers and the efforts of its owners, West Edmonton Mall could see new and exciting retailers including Saks Fifth Avenue and possibly Nordstrom.
Saks Fifth Avenue‘s discount retail concept ‘Off 5th‘ will open up to 25 Canadian locations, according to Hudson’s Bay Company CEO Richard Baker. Saks’ Off 5th concept will likely follow the opening of Canadian Saks Fifth Avenue stores, which we expect to happen within the next 12-18 months.
Existing Hudson’s Bay real estate will likely be utilized for Off 5th stores, including some Home Outfitters and former Zellers real estate still held by The Hudson’s Bay Company. Existing store space within Hudson’s Bay stores could also be utilized for Off 5th.
Off 5th carries both discounted merchandise from Saks Fifth Avenue’s full-priced stores, as well as products purchased specifically for the store. Off 5th will therefore compete with the likes of Nordstrom Rack and Holt Renfrew’s recently opened hr2 concept.
Off 5th stores are generally 20,000-35,000 square feet, with a recent focus on stores in the 25,000-28,000 square foot range, according to an article describing the chain’s expansion strategy. It would be relatively easy for Hudson’s Bay to open Off 5th stores within existing Hudson’s Bay real estate, including possibly the sub-basement of Hudson’s Bay’s Downtown Vancouver store, which currently has over 43,000 square feet of space for lease.
We’ll update you when we start learning of Off 5th Saks Fifth Avenue Canadian locations.
Proposed street level plan, Hazelton Lanes. Source: Kasian/First Capital
These are the proposed lease plans for Toronto’s Hazelton Lanes renovation (see above and second-to-last image). Yesterday we reported that Hazelton Lanes will undergo extensive renovations to attract more luxury tenants. From the looks of the plans, most of the mall will see an overhaul. The future of anchors Andrews (department store) and Equinox Fitness are in question, as they appear to possibly be absent from the new plans. However some anchors, including Whole Foods, will stay.
The current Hazelton Lanes floorplan (above) includes department store Andrews,
which has two retail levels. We’re not sure if Andrews will be part
of the mall, though it’s possible it could be relocated to two larger
retail spaces, one above the other, near the new oval atrium area. Noticeably absent from the
new plans is Equinox Fitness, as its current space appears to be
dedicated to retail in the new plans.
136-138 Yorkville Avenue, to be demolished for Hazelton Lane’s Yorkville Avenue Entrance
Proposed Yorkville Avenue entrance, to replace 136-138 Yorkville Avenue
First Capital recently purchased 136-138 Hazelton Avenue with the
intention of demolishing structures for the mall’s southward expansion. However, we don’t yet have modified lease plans for a southward expansion of Hazelton Lanes to include an entrance on Yorkville Avenue.
Proposed street level plan, Hazelton Lanes. Source: Kasian/First Capital
We’re hoping to soon learn of which luxury retailers will sign up for space at Hazelton Lanes. Given the challenges of finding space on Bloor Street, some luxury stores may see Hazelton Lanes as a viable alternative to Bloor. And having one landlord could give Hazelton Lanes an edge in securing tenants over Bloor Street, where retail space is owned by multiple parties.
We encourage commercial real estate professionals involved with the Hazelton Lanes project to keep us updated on the mall’s possible tenants. We’ll keep sources confidential.
Toronto’s Hazelton Lanes shopping centre is looking to get back into the luxury retail game. Landlord First Capital Realty is said to be negotiating with some of the world’s top luxury retailers (rumours include Salvator Ferragamo, among others). If successful, Hazelton Lanes could once again rival neighbouring Bloor Street as one of Toronto’s luxury shopping addresses.
For those unfamiliar, Hazelton Lanes is an upscale retail complex located in Toronto’s affluent Yorkville neighbourhood. Hazelton Lanes’ first phase (55 Avenue Road) was built in 1976 and was constructed specifically to be a small (60,000 square foot) luxury mall. Because it opened before the Toronto Eaton Centre, it managed to secure perhaps more upscale retailers than it otherwise would have. At the time, Toronto lacked luxury retail, save for Holt Renfrew (in a 60,000 square foot store at 144 Bloor Street West, now Burberry), womenswear retailer Creeds, and The St. Regis Room (now ‘The Room’ at Hudson’s Bay) at Simpsons, Queen Street.
We’ve got Hazelton Lanes renderings, a video presentation and lease plans. We’ll post the renderings and video today and the lease plans tomorrow, to keep this article relatively brief.
IMAGE: KASIAN/FIRST CAPITAL
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IMAGE: KASIAN/FIRST CAPITAL
IMAGE: KASIAN/FIRST CAPITAL
IMAGE: KASIAN/FIRST CAPITAL
IMAGE: KASIAN/FIRST CAPITAL
Above is a video provided by First Capital showing their vision for the new Hazelton Lanes. Thank you to pw20 of Urban Toronto for locating the video.
Hazelton Lanes almost tripled in size in 1988 (adding address ’87 Avenue Road’ as its north portion) and became host to even more luxury retailers. The recession that hit Toronto a couple of years later resulted in many luxury stores closing at Hazelton Lanes. The mall’s awkward configuration, low ceilings and inconveniently-located entrances didn’t help things, either.
Hazelton Lanes eventually became more of a neighbourhood shopping centre (albeit an upscale one) of almost 237,000 square feet with anchors including Whole Foods, Andrews department store, an 18,000 square foot fashion retailer called TNT, Equinox Fitness and Rexall Drugs.
Things are about to change in a big way for Hazelton Lanes. First Capital will renovate the entire Hazelton lanes and modernize the complex to include an oval-shaped central atrium as well as reconfigured entrances. An entirely new entrance will be located on Yorkville Avenue, providing better pedestrian access to the mall from affluent Yorkville.
We’ll post and discuss Hazelton Lanes’ lease plans tomorrow. Thank you to a source who wishes not to be named for providing us with renderings and lease plans for Hazelton Lanes.
We’re taking a brief holiday to continue researching Canadian retail. We’ll have new articles up for the morning of Tuesday, August 6th. We’re working on some ground-breaking stories, including:
The expansion of Toronto’s Hazelton Lanes to include luxury retailers,
The potential addition of further luxury retail on Toronto’s Bloor Street,
New additions to Montreal’s retail scene, and
A significant expansion of luxury retail at three Downtown Vancouver locations
These are exciting times for Canadian retail, largely due to American retailers expanding north of the border. Be it budget or luxury, Target or Saks Fifth Avenue, our shopping choices in Canada will be unparallelled to any time in our history.
Have an excellent long weekend, everyone, and thank you for reading Retail Insider.
Dolce & Gabbana Toronto store, 111 Bloor St. W., nearly finished.
Milan-based fashion house Dolce & Gabbana could shutter if tax fraud convictions against its designers aren’t overturned. A Dolce & Gabbana flagship store just opened on Toronto’s Bloor Street, and Dolce & Gabbana shops-in-store are located across Canada at selected Holt Renfrew and Harry Rosen stores.
In June, Dolce & Gabbana’s designers were found guilty of tax evasion and were ordered to pay a fine of about $440 million, as well as serve 20 months in jail. The designers are appealing the verdict.
Last week the designers temporarily closed all of their Milan stores out of “indignation“.
Dolce & Gabbana is one of the top-performing fashion labels for Holt Renfrew, we’ve been told. The label does so well, in fact, that it includes some dedicated shops-in-store within selected Holts stores for men and women. The men’s version of the label is also carried at selected Harry Rosen locations.
Holt Renfrew is taking a page from its sister store Selfridge’s in London. Selfridge’s enormous women’s shoe hall includes shops-in-store for various designers including Chanel, Jimmy Choo, Louboutin, and at the lower end, TopShop.
Yorkdale’s Holt Renfrew is being designed as the prototype store for future Holt Renfrew store expansions and renovations. The Yorkdale Holts recently opened a new 10,000 square foot beauty hall and it will debut an expanded menswear department, accessories area and women’s designer floor. New women’s ready-to-wear boutiques will include the likes of Gucci, Prada, and a major score – a Chanel Boutique.
Rendering – Manolo Blahnik
Given that the Yorkdale Holt Renfrew is being used a prototype, we can expect Holt Renfrew to roll out similar shoe floors and updated departments at Holt Renfrew stores nation-wide.
Jimmy Choo has 27 free-standing American stores, 2 outlet stores and 3 boutiques within Bloomingdale’s stores. It is also carried at Holt Renfrew stores across Canada. Manolo Blahnik has 2 American boutiques and is available at selected Saks Fifth Avenue, Neiman Marcus, Nordstrom and Barneys New York stores in the U.S. It is carried at selected Holt Renfrew and Browns Shoes stores in Canada.
Hudson’s Bay Company CEO Richard Baker says that he expects up to 7 Saks Fifth Avenue stores to open in Canada. He also says he wants them to open quickly. The quickest and most cost effective way to do this would be to open Saks within existing Hudson’s Bay store space.Â
Despite having possibly paid too much for Saks, Richard Baker is a shrewd businessman who knows real estate. Given this, we expect his vision for a Saks rollout will involve configuring some existing Canadian Hudson’s Bay store space into space for Saks. It remains to be seen how, exactly, this configuration will take place.Â
Furthermore, it would make less financial sense to build entirely new Saks store space. Hudson’s Bay already has millions of square feet in Canada, some of which it owns outright. It would make more sense to utilize existing underperforming space rather than create new spaces that would be expensive to build and would take time to plan, design and construct.Â
Recently renovated designer floor at Saks, Manhattan.
Existing Hudson’s Bay stores generally earn less than $200 per square foot. Saks’ Canadian stores could generate triple that amount, or even more, if successful. Utilizing some existing HBC real estate would involve gutting and re-fitting space for which the retailer either pays minimal or no rent. We would be surprised to see many, if any, newly built Saks stores in the short term.Â
Over the longer term, if Saks is successful in Canada, it could possibly see some newly built, free standing Canadian stores. With competition from Holt Renfrew and Nordstrom, however, we think Saks Fifth Avenue’s Canadian business will be challenged.
We will be regularly analyzing Saks Fifth Avenue’s opening in Canada from various angles, especially in the coming weeks. Please check back regularly, as we’ll also be keeping an ear to the ground to see what management has planned for new Canadian Saks stores.Â
The Hudson’s Bay Company (HBC) has just purchased American luxury retailer Saks Fifth Avenue. This paves the way for Canadian Saks Fifth Avenue store locations, as well as its discount chain Off 5th to open Canada-wide.
We reported on the three potential Saks buyers, including Hudson’s Bay, Sternlicht and an unknown Middle-Eastern purchaser. With Sternlicht out of the race, only two potential purchasers remained.
Hudson’s Bay may find it difficult to make Saks succeed in Canada. Holt Renfrew achieves substantial sales per square foot. Excluding Saks’ Manhattan and San Francisco flagships, Holt Renfrew stores achieve considerably higher sales per-square-foot than most Saks stores. Not to mention, Holt Renfrew has exclusive distribution agreements with many designers already carried at Saks’ American stores.
Saks’ outlet concept ‘Off 5th‘ is also expected to come to Canada. Off 5th carries both discounted merchandise from Saks’ full-priced stores, as well as products purchased specifically for the outlet store. Off 5th stores will compete with Nordstrom Rack and Holt Renfrew’s recently opened hr2 concept.
Saks’ purchase by HBC will lead to Saks stores opening in Canada, either free-standing or within existing Hudson’s Bay store space. Last month we first reported on HBC’s potential purchase of Saks. We subsequently discussed possible Canadian Saks locations. HBC has been contemplating a potential Saks purchase for months and we’re re-posting our analysis of some possible locations for Saks in Canada.
Newer American Saks Fifth Avenue stores are generally in the 80,000-120,000 square foot range. 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’ve 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.
Downtown Toronto: 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
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 in the mall now that it will include a 120,000 square foot Holt Renfrew store and possibly a branch of La Maison Simons.Â
Hudson’s Bay, Downtown Calgary
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 expand. 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 that 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 137,000 square foot Holt Renfrew and a 230,000 square foot Nordstrom which will open in 2015.Â
Hudson’s Bay, Rideau Street, Ottawa [Image Source]
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, also in 2015. Competitor Holt Renfrew, located way over at 240 Sparks Street in Downtown Ottawa, could see an uncertain future as a result of a Saks opening 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, could 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’.
We’ll keep you updated on HBC’s possible Saks purchase. As we mentioned, an announcement could be made as early as this week.
