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Brief: Naturalizer Shoes Shutting Stores, HBC Struggles With Leases

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By Retail Insider

1
Naturalizer Shoes to Close All Canadian Stores

Naturalizer store in Nisku, Alberta. Photo: Canada247
Naturalizer store in Alberta. Photo: Canada247

Footwear brand Naturalizer, a division of St. Louis-based Caleres Inc., will shut its Canadian stores early next year after the US company announced a restructuring last week. In total, 133 of Naturalizer’s stores will shutter in North America with more than 60 of those locations being in Canada. Two US stores will remain open including a flagship on 34th Street in New York City as well as a store at Dadeland Mall in Miami.

In Canada, Naturalizer operates stores in shopping centres and outlet centres in major markets spanning from British Columbia to Newfoundland. The Greater Toronto Area and Montreal area have the greatest concentration of Naturalizer stores in Canada. Mall landlords will again have to grapple with filling vacated space after a wave of permanent store closures following a challenging retail environment that included store shutdowns in the spring due to the COVID-19 pandemic.

In its third-quarter earnings conference call, Caleres Inc. announced that it would shutter 133 of the brand’s “legacy” stores in the United States and Canada by the end of the fiscal year. The plan is to grow Naturalizer’s e-commerce business through its online platform and via its retail partners’ websites.

“Make no mistake, we continue to view the Naturalizer brand as a strong and value-driving component of our portfolio,” said Chairman, President, and CEO Diane Sullivan.

2
Hudson’s Bay in a Challenging Situation as Stores Shutter

Hudson'sBay Company signage outside CF Toronto Eaton Centre. Photo: Dustin Fuhs
Hudson’s Bay Company signage outside CF Toronto Eaton Centre. Photo: Dustin Fuhs

We reported last month that the Hudson’s Bay Company was being sued by landlords for not paying rent, while HBC alleges that mall landlords are not meeting contractual obligations to keep properties top-notch during the pandemic. It appears that HBC hasn’t paid rent since April for at least 20 of its 89 stores in Canada and that it is paying rent for some locations “under duress”.

The situation has taken an interesting turn. Over the weekend at least two Hudson’s Bay stores in Canada were shut due to landlord lockouts. In the Vancouver suburb of Coquitlam, landlord Morguard locked Hudson’s Bay out of its premises at Coquitlam Centre and a Bay store at Centrepoint Mall in Toronto was also shut briefly and the store is now open for curbside pickup.

A Hudson’s Bay spokesperson said, “Hudson’s Bay is grateful that the Ontario Superior Court of Justice has recognized the extraordinary challenges of the global pandemic and how the burden can be shared fairly and lawfully. HBC believes the courts will continue to provide a common sense approach that is fair to landlords and retailers. The majority of Canada’s leading landlords share this view and have reached mutually acceptable agreements with us. When Morguard tried to evict us, without regard for the impact on our employees, vendors and other retailers, we had no choice but to defend ourselves. We accept the Court’s Order and will continue to ask for a fair sharing of the burden of the pandemic with respect to this lease and each of our other leases across the country.” 

On Hudson’s Bay’s website, the retailer notes that it is no longer accepting returns or exchanges at its Les Jardins Dorval location in suburban Montreal. The same notice states that returns are no longer being accepted at Hudson’s Bay’s downtown Winnipeg and downtown Edmonton stores — both of which are confirmed to be closing. One analyst said they expect a store closing announcement for the Dorval store, which opened in 1954 as an upscale Morgan’s department store.

The city of Toronto was put in a second lockdown on Monday for 28 days. Hudson’s Bay’s Queen Street store remained open Monday because the building includes a Saks Fifth Avenue foot hall operated by Pusateri’s Fine Foods. That store had been closed since March however — even last week, signs in the shuttered Pusateri’s said that the store would reopen again in January of 2021. On Monday, the grocery store unexpectedly partially reopened featuring areas of the store with specialty items such as pasta. Areas in the store for fresh produce, dairy and eggs were empty and the store’s prepared foods section was cordoned off.

After publishing this Brief Monday evening, Hudson’s Bay provided a statement to Retail Insider about the closures and the fact that the Queen Street flagship store won’t be open Tuesday.

“On Sunday evening, the order issued by the province changed the guidelines regulating the operation of retail stores. We reviewed closely to ensure compliance and, as such, closed all our stores in Toronto and Peel but one, which contained a grocery store. We understood this to be in line with the province’s direction, however we have now made the decision to close our Queen Street store tomorrow. All Hudson’s Bay stores in Toronto and Peel will offer shoppers curbside pickup.”  

Landlords across the country are suing HBC for unpaid rent which has been reported extensively in the press. Hudson’s Bay paid about $20 million a month in rent for its stores prior to the pandemic.

The Hudson’s Bay Company’s focus is increasingly on real estate assets. Hudson’s Bay’s overall footprint will be reduced as some of the retail space in its stores is downsized, while a more vast assortment of product will be made available online. Integration will also be paramount. A proposed residential tower on the side of a Hudson’s Bay store in Montreal, for example, could become a built-in community that would also shop at the adjacent Bay store. It will be interesting to see what happens to downtown Bay flagships downtown in Vancouver, Calgary and Montreal which HBC own and may look to at least partially redevelop.

Hudson’s Bay will grow its e-commerce substantially by launching a third-party ‘marketplace’ on its website next year. That move is expected to double the product assortment and give HBC a boost. Thebay.com is already Canada’s fifth largest e-commerce business with more than 220 millions website visits per year. This month marks the 20th anniversary of thebay.com.

We’ll continue to follow Hudson’s Bay as we are sometimes provided information that others may not have.

3
Peloton Opening 2 Permanent Vancouver Storefronts Including a Downtown Flagship

New Peloton store on the corner of Robson Street and Hornby Street in downtown Vancouver. Photo: Martin Moriarty
New Peloton store on the corner of Robson Street and Hornby Street in downtown Vancouver. Photo: Martin Moriarty

New York City-based fitness company Peloton, known particularly for its luxury stationary bicycles that live-stream spin classes, is building permanent retail spaces across Canada amid a workout-from home movement. In the Vancouver area, Peloton will have two storefronts — one opened recently at Park Royal in West Vancouver, and a second is now under construction at the prominent northwest corner of Robson Street and Hornby Street.

The 919 Robson Street Peloton will replace a Foot Locker store which relocated up the street. The retail space includes a 3,500 square foot main floor and a 1,500-square-foot basement space. The store will face Robson Square that includes the Vancouver Art Gallery. In years past, 919 Robson Street was home to iconic retailer Duthie Books which went bankrupt in 1999.

The Park Royal Peloton location spans 3,451 square feet, replacing a J. Crew store that exited the mall last year.

Peloton will also open a pop-up store early next year in Vancouver’s Kitsilano area, replacing a pop-up on South Granville Street. Located at 2123 west 4th Avenue (formerly occupied by Iviva), the Peloton pop-up will span 1,981 square feet.

The three lease deals were coordinated/negotiated by Martin Moriarty and Mario Negris of CBRE Vancouver. We’ll be reporting on more Peloton locations in Canada which are currently under construction.

4
Simons Sees Success With Second-Hand Goods

Simons store. Photo: Simons
Simons store. Photo: Simons

In September we reported that Quebec City-based large format retailer La Maison Simons had introduced second-hand luxury goods to three of its stores. A French language report from La Presse notes that the product has sold out quickly amid remarkable success.

About 40 vintage luxury items on Simons’ website sold out completely in a day, including timeless pieces by Louis Vuitton and Chanel. Within the first two days 60% of all of the second-hand product in the Edito departments had been sold. Despite being second-hand, prices for many of the bags offered are in excess of $1,000.

Simons struck a partnership with luxury resellers LXRandCO and VSP Consignment on the initiative, which saw vintage collections rolled out at Simons’ stores at Place Ste-Foy in Quebec City, downtown Montreal, Square One in Mississauga, and at CF Rideau Centre in Ottawa. Bag and accessory brands carried at those Simons stores as well as online include Louis Vuitton, Chanel, Prada, Hermès, and others. Women’s apparel brands include names such as Versace, Sonia Rykiel, John Galliano, Miu Miu, Saint Laurent, and Jean Paul Gaultier, among others.

At the same time, less new designer goods are carried at Simons stores for the time being after much of it had been pulled in the spring of 2020 due to challenges with credit insurance.

5
Call it Spring Shutting All US Stores

Call it Spring store. Photo: Aldo Group
Call it Spring store. Photo: Aldo Group

Aldo-owned footwear retailer Call it Spring will exit its US physical storefronts as it takes its business online. We reported in the spring that Aldo had filed for creditor protection with plans to close many of its stores globally amid financial struggles.

The 49 US mall-based Spring stores will shut over the next few weeks with all locations set to be shut before January. A liquidation sale is being held to clear out the merchandise.

“Because the retail industry has experienced rapid and significant change over the last several years, Call It Spring already had plans to transition towards a more robust digital presence in the U.S.; however, that timeline was accelerated due to the pandemic,” he said. “Shifting to an online experience allows us to better serve our customers by being where they are — online at Callitspring.com,” said Emmanuel Amzallag, SVP of Call It Spring.

We reported last year that Call it Spring had announced that its entire line of footwear and bags/accessories would become fully vegan.

6
Toys R Us Opens Larger Store in Guelph

Photo: Toys R Us
Photo: Toys R Us

Toy retailer Toys R Us has opened a new 17,000-square-foot store at Stone Road Mall in Guelf, Ontario. The store features a range of product including baby products in a separate space. In 2018, Toys R Us launched its ‘Toybox’ concept at Stone Road Mall and the new store replaces it. The opening is just in time for the busy December holiday season, with toys expected to be a big seller partly due to the uniqueness of this year because of the pandemic.

Toys R Us also recently partnered with Doordash to ensure shoppers are getting same-day delivery on their holiday wishlists and avoid crowds and delayed shipments. Orders must be placed by 2PM to receive their items on the same day.

7
Purolator Partners With Michaels

GIF image of Purolator and Michaels collaboration
GIF image of Purolator and Michaels collaboration

Purolator has partnered with crafts retailer Michaels by offering package pick-up and drop-off services at 135 Michaels retail stores across Canada. That includes the launch of 13 Canadian limited-edition parcel box designs. Independent artists from across the country were commissioned to interpret what winter and the holidays mean to them, and what sharing with loved ones means especially across distances. Beginning in early December, Canadians can get these specially designed boxes from Purolator locations and Michaels stores and use them to send gifts and packages using Purolator Express.

Michaels is also inviting Canadians to get creative and share their own interpretation of the holidays. Canadians are invited to visit michaels.ca to download a box template and enter to win prizes including a grand prize of $1,000 worth of Michaels supplies, plus free shipping with Purolator (up to $1,200). Canadians can visit michaels.ca/en/boxdesignsweeps for contest details and to learn more about the artists.

Purolator expects to process 46 million packages in Canada in November and December of this year, a 20% increase over last year. The company expects to process 1.3 million packages on Black Friday (25% higher than last year) and an additional 6.7 million pieces the week of Cyber Monday — an 18% increase over last year. November 30 is expected to be the busiest day with 1.4 million parcels processed, about 20% higher than last year.

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2 COMMENTS

  1. I can only wear Naturalizer shoes. My feet hurt and I am in pain wearing other shoes that do not fit. I have to wear a wide width and soft shoe from Naturalizer. No other stores should sell wide width shoes.

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