Richard White
Senior Member
@Northern Light is the subject matter expert but in laymans terms they mortgaged the house to buy an investment property.
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@Northern Light is the subject matter expert but in laymans terms they mortgaged the house to buy an investment property.
nightstreak
Active Member
I asked chatGPT and got this:
• Total Assets: $3.7 billion.
• Total Liabilities: $3.2 billion
Ouch. But hey, they have $500 million to spare. Theoretically could they liquidate most of their assets and still have $500M leftover to launch a reinvented Hudson's Bay? The brand itself has to be worth something.
I'm probably as guilty as anyone of not shopping there for a long while but it's terribly sad to see The Bay go under after 300 years. Is there nobody interested in reinventing the place?
• Total Assets: $3.7 billion.
• Total Liabilities: $3.2 billion
Ouch. But hey, they have $500 million to spare. Theoretically could they liquidate most of their assets and still have $500M leftover to launch a reinvented Hudson's Bay? The brand itself has to be worth something.
I'm probably as guilty as anyone of not shopping there for a long while but it's terribly sad to see The Bay go under after 300 years. Is there nobody interested in reinventing the place?
AlvinofDiaspar
Moderator
I don't think it would be appropriate in this instance to prop up a business with zero strategic value. The government's role is to ensure the laid off workers have access to EI.
AoD
nightstreak
Active Member
Zero? Maybe not zero. We're going to need striped Hudson's Bay Canada mittens when we storm The White House.
lenaitch
Senior Member
Those land holdings were relinquished to the Crown in a Deed of Surrender in 1870.
I can't think of many takers for anchor-type square footage. Although there are outliers, the corporate position for both Walmart and Canadian Tire is stand-alone stores. As far as I'm concerned, both are real estate companies that happen to sell stuff.
Richard White
Senior Member
Crappy Tire isn't doing so well at Bay and Dundas (though I'm likely mistaken) which unto itself has a decent amount of space. Some of their standalone stores are up for redevelopment such as the Yonge and Church store I believe.
Walmart used to be the anchor tenant for malls and in some cases still is.
For years, Walmart anchored Morningside Mall. When it left the mall died. Walmart anchors Dufferin Mall at the moment alongside No Frills.
The real issue is the size of the Bay stores. Most of them are 3 stories or more. I believe Queen Street is 7 or so.
Not many people have the ability to fill that much space
nightstreak
Active Member
I just went down a rabbit hole on the monitor's site. Besides the 10,000 lost jobs, there's the $1 billion of debt. Less than half, $400M are banks and other secured creditors. The unsecured creditors list is 25 pages long and over $500M. Many of those businesses aren't getting paid. Jesus this is going to be an economic nuclear bomb. Could not have come at a worse time.
The effect on malls is more collateral damage. I don't think this will have any effect on the Eaton Centre or Yorkdale but I can think of a few malls that are going to shut down after having an empty anchor tenant, taking even more jobs and businesses with it.
A lot of people could see The Bay's demise coming for years but now that it's here, it's hard to grasp how big of an effect an outdated department store chain going out of business is going to be.
The effect on malls is more collateral damage. I don't think this will have any effect on the Eaton Centre or Yorkdale but I can think of a few malls that are going to shut down after having an empty anchor tenant, taking even more jobs and businesses with it.
A lot of people could see The Bay's demise coming for years but now that it's here, it's hard to grasp how big of an effect an outdated department store chain going out of business is going to be.
Richard White
Senior Member
Woodbine Mall for starters.
lenaitch
Senior Member
Like I said, there are outliers; most likely in dense urban cores where acquiring standalone real estate isn't practical. Similar to Shoppers Drug Mart. There are some in malls (indoor malls, not strip plazas) but most have decamped to standalone.
nightstreak
Active Member
Going down the list of thousands of businesses the Bay owes money to, I wasn't surprised to find a bunch of elevator companies. One in Vancouver is owed over $330,000 and one near Toronto is owed $220,000. Then there's SCHINDLER ELEVATOR CORPORATION that is owed $3,550,849. Mystery of The Bay's perpetually broken escalators and elevators: solved.
But it's heartbreaking to see what looks like a lot of small mom and pop businesses owed so much money. This is going to break many of them. what are the odds anyone gets paid?
But it's heartbreaking to see what looks like a lot of small mom and pop businesses owed so much money. This is going to break many of them. what are the odds anyone gets paid?
stevensontransit
Active Member
so could winners/marshalls/homesense immediately fill those former hudsons bay spaces once it closes?
matrix
Active Member
Yeah, I was just spitballing. The situation reminded me of when Target exited, and I remember Walmart and Canadian Tire taking advantage of that. It's not lost on me that The Bay is a different situation though... Key phrase, "depending on location". I'm still on the side of "splitting up the anchor" here. I can't name many takers as well.
matrix
Active Member
Obviously they aren't going to replace every single one, but I really do believe they will at least take ONE of those spaces. I work for Winners, the business model is insanely scalable that it's almost scary. They don't care about location at all because they can turn a profit so easily, the customers love "The Thrill Of The Find". There are numerous areas that have multiple Winners in close proximity to one another, or a Winners in the same mall or close in distance to a Marshalls (Heartland, Vaughan Mills, Yonge and Dundas, Stock Yards Village, Dufferin Mall, Markville, RioCan Colossus/Woodbridge...) With any other business, that'd be an insane thing to do, but the off-price model works so well that it doesn't matter...
All this to say, they have far fewer considerations to take with store openings than most businesses. They have taken advantage of anchor closings before like Sears and Target, and they're pretty hard to say no to if you have a big vacant space to fill... These are multi-million-dollar revenue stores. And I've never seen a Winners/Homesense/Marshalls close other than to relocate.
matrix
Active Member
Escalator/elevator outages are a litmus test for when you want to ask yourself "is this place struggling?". If you go to a mall and an escalator is shut for maintenance, chances are if you go the next day it'd be fixed, because CF/Oxford whoever can afford it and it's small potatoes for them. Same thing with Walmarts that have numerous stories. But if you're seeing escalators or elevators out of order for months on end like most Bay locations had... It means they can't afford to pay the people who fix them. And at that point, you can bet they're struggling for cash!
stevensontransit
Active Member
and could simons acquire some former hudsons bay locations as well?