VANCOUVER — Several Hudson’s Bay stores across sa国际传媒 — including Vancouver Island — were closed Tuesday due to what the company said were issues with their air conditioning systems, another blow to the retail giant’s Canadian operations, which have been beset with numerous challenges.
In the past year, the Hudson’s Bay Co. has laid off hundreds of employees and reportedly fell behind on payments to suppliers.
Last week, its parent company, HBC LP, announced it was acquiring luxury retailer Neiman Marcus for over US$2 billion. It’s working with online retailer Amazon, software company Salesforce and other investors to create Saks Global, a new entity that will target shoppers who want to buy luxury products online. This new group will bring together the U.S. real estate assets of HBC and Neiman Marcus, which the company said are worth US$7 billion.
As part of the deal, HBC LP will continue to wholly own Hudson’s Bay stores in sa国际传媒 and Canadian real estate assets worth US$2 billion, but the Canadian business will be restructured to be separate from Saks Global, which will mean “significantly reduced leverage and enhanced liquidity” or less debt and better access to cash, according to a news release.
But less than a week later, the doors at a number of Hudson’s Bay stores across sa国际传媒 were closed on Tuesday — and some had already been closed for several days.
“The current heat wave has caused strain on HVAC systems in certain Hudson’s Bay locations,” said company spokeswoman Tiffany Boureé. “We are working to address this as quickly as possible. The comfort and well-being of customers and associates remains our top priority.”
Boureé wasn’t able to provide a list of store closures, a timeline for when the HVAC issue might be resolved or answer why so many stores were being impacted at once. She said in an email that “as the situation is fluid, signage will be posted at the individual store level.”
At the downtown Vancouver flagship store, an employee answering the phone said “I’m not sure” when asked if the location might reopen Wednesday.
In West Vancouver, Coquitlam and Victoria, staff at the Park Royal, Coquitlam Centre and Bay Centre malls confirmed that their HBC stores were closed Tuesday. The Bay Centre store was also closed on Monday due to maintenance on its heating, ventilation and air-conditioning systems.
An employee at Woodgrove Centre mall in Nanaimo said the lights were off Tuesday at their HBC store.
HBC’s Langley store was one of the few that was open on Tuesday, according to a staff member who answered the phone. The store at Mayfair Shopping Centre in Victoria was also open.
Media reports indicate stores in Alberta and Manitoba have also been closed in recent days.
The HVAC issues appear to be confined to HBC stores. For example, even though the HBC store is closed at Sevenoaks Shopping Centre in Abbotsford, other retailers at the mall remain open.
Vancouver retail analyst David Ian Gray said that the reported air-conditioning-system failures are part of a bigger picture.
“It’s not just the heat wave. They’ve let go of the infrastructure and now they’re paying the price,” he said.
In late 2023, the parent company HBC LP said it used cash from the sale of real estate properties to help it make payments on overdue invoices to HBC vendors.
In January, shoppers decried the state of disrepair at HBC’s downtown Vancouver store where most of the elevators and escalators were out of service. At the time, staff were overheard telling bewildered customers that elevators had been out of service for awhile and that they didn’t know day-to-day which escalators might be working. On most floors, there was no background music being piped in and arrows placed on the floor directed shoppers to use a stairwell.
Shoppers at other HBC locations in sa国际传媒 reported similar scenarios.
A company spokesperson said at the time that repairs were expected to be underway the same month, but months later, in May, the elevators and escalators were still out.
“There is general upkeep that has obviously not been happening,” said Gray.
Boureé didn’t reply by deadline to a question about store infrastructure maintenance.
The deal to buy Neiman Marcus, which went bankrupt in 2020, for US$2.65 billion, includes combining that brand with the parent company’s other international assets, including Saks Fifth Avenue and Bergdorf Goodman.
“So, you can see where the energy is for senior leadership at HBC. There’s not going to be sudden reinvestment for HBC stores,” said Gray.
The downtown Vancouver store has been earmarked for redevelopment since HBC announced in 2022 a mixed-use project that would retain the outside of the heritage building and add a one-million-square-foot, 12 storey glass office tower on top.
At the time, HBC executives unofficially estimated the redevelopment cost at CDN$700 million. Since then, the downtown Vancouver office vacancy rate has been at the highest in two decades, although numbers have moderated and are lower than seen in other Canadian cities.
A New York-based HBC spokesperson said that HBC continues to envision the future of Vancouver’s – Hudson’s Bay store at Georgia and Seymour streets: “We are committed to exploring the redevelopment of The Bay building.”
— With files from Stephanie Ip and Douglas Quan, and from the Times Colonist
