Real Estate

Downtown Vancouver's landmark Hudson's Bay building may be put up for sale

by Charlie Smith on October 30th, 2017 at 3:32 PM
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      One of Vancouver's most recognizable buildings could have a new owner.

      A joint-venture company controlled by HBC and RioCan Real Estate Investment Trust, has retained real-estate advisers to investigate whether the Hudson's Bay property could be sold.

      Its street address is 637 Granville and the building extends from Granville to Seymour streets along West Georgia Street.

      “We are exploring a sale of this flagship property as the Vancouver real estate market has appreciated significantly over the past several years," HBC executive chairman and interim CEO Richard Baker said in a news release. "While no decision to sell has been made, we continue to explore opportunistic transactions to enhance shareholder value. 

      “We are committed to operating our Hudson’s Bay store at this location," he continued, "and any possible sale would include the continued operation of Hudson's Bay at this property."

      Baker became interim CEO on October 20 after the resignation of Gerald Storch.

      Rio-Can-HBC JV—which is controlled by HBC and RioCan Real Estate Investment Trust—also "expects to close in on a $200 million mortgage on the same property", the news release stated.

      "The mortgage is expected to be for a term of four years at a rate of prime plus 1.0% and has no prepayment penalty in the event of a sale of the property," the news release states.

      Here's how the building appeared in December 2005.
      Dennislo

      The Hudson's Bay's parent company, HBC, also owns the Saks Fifth Avenue, Saks OFF 5th, Lord & Taylor, and Galeria Kaufhof retail chains.

      In the first two quarters of this year HBC reported as $2.3-million loss on sales of $6.5 billion. That was up from a $1.3-million loss after two quarters in 2016 on slightly higher sales.

      Last week, HBC announced that it had sold the Lord & Taylor Fifth Avenue building in New York for $1.07 billion.

      It has also reached agreements with WeWork Property Advisors to lease retail space in some of its department stores, including the Granville Street location in Vancouver.

      This is how it looked in May 2006.
      Arnold C

      The transactions announced last week were expect to boost the company's balance sheet by $1.6 billion and increase liquidity to $1.1 billion.

      "HBC currently anticipates minimal impact on its earnings from the sale of the Lord & Taylor Fifth Avenue building, which, in comparison is many times less productive than the Saks Fifth Avenue flagship building," the company stated on October 24, "and the sale of the building further demonstrates the value of HBC’s global real estate and the Company’s commitment to maximize productivity."

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