Senior UT Member
Syn, I would love it if the Bay got their act together but I truly believe they are incapable. That said, even a revitalized Bay chain would benefit from some competition. Department store shopping isn't as dead as one would believe, especially in urban centres. Macy's or Lord and Taylor, not to mention Target, will likely do very well in Toronto and the GTA.
Senior UT Member
^I meant that instead of bringing in Lord & Taylor, revitalize The Bay.
UT Member
From The Globe and Mail
NRDC Equity buys Hudson's Bay
MARINA STRAUSS
Globe and Mail Update
July 16, 2008 at 1:32 PM EDT
Upscale U.S. department store chain Lord & Taylor is about set up shop in Canada.
The company that owns Lord & Taylor bought Hudson's Bay Co. on Wednesday and will convert up to 15 of its key Bay department stores to the U.S. retailer's name.
The move marries the two oldest department store retailers in North America, and will create an $8-billion (U.S.) merchandising powerhouse for the new buyer, NRDC Equity Partners of Purchase, N.Y. It will combine HBC's Bay, Zellers, Home Outfitters and Fields chains with NRDC's Lord & Taylor and Fortunoff, the jewellery and home decor chain.
“By acquiring Hudson's Bay Co. along with previous acquisitions Lord & Taylor and Fortunoff, we will have an unprecedented opportunity to recreate the retail landscape in North America,” said Richard Baker, chief executive officer of NRDC. The newly expanded holding company will be called Hudson's Bay Trading Co.
“Enormous potential exists by upgrading the offerings at both the Bay and Zellers and by bringing Lord & Taylor, Fortunoff and CDS into the mix.” CDS, or Creative Design Studios, produces fashion lines.
The deal, for an undisclosed amount, comes just three months after the death of Jerry Zucker, the South Carolina businessman who acquired HBC in early 2006 for $1.1-billion and took it private.
Mr. Zucker began to make changes at the chains, moving the Bay more upscale and adding new brands to the mix, while renovating Zellers stores and expanding Fields. Last summer, he appointed his chief lieutenant, Robert Johnston, as president of HBC. He was promoted to chief executive officer in April and succeeded Mr. Zucker on his death.
Now Mr. Baker, who becomes the 38th governor, or chairman, of HBC, is investing $500-million into the combined new company and is set to put his own stamp on the retailer. Mr. Baker is already familiar with HBC, having sat on its board of directors since 2006. NRDC owns what is believed to be about 20 per cent of HBC.
He said in a statement he plans to convert the Bay's most high-profile 10 to 15 stores to Lord & Taylor. It's a high-end U.S. fashion department store chain that was bought by Mr. Baker's holding company in 2006 and has since enjoyed a turnaround under his watch. It has also moved to more high-end fashions after closing some of its weaker outlets, leaving it with 47 stores. HBC has about 580 outlets in all.
Lord & Taylor will serve to fill a gap in the Canadian retail landscape between the Bay and the carriage trade Holt Renfrew, Mr. Baker said.
He wants to put greater focus on branded apparel at discounter Zellers, he said. He plans to improve its customer service and, in the future, roll out new 125,000-square-foot prototype stores.
He will also bring Fortunoff to Canada, both as standalone stores and within the Bay. And he wants to expand NRDC's Creative Design Studios, selling its branded collections throughout North America and internationally. Its brands include Peter Som's eponymous collection as well as the Kate Hill and Context brands for women, and the Black Brown 1826 men's brand.
Senior UT Member
I guess this means the Queen Street location will go out of business. That's unfortunate.
Moderator
Still no Target
In any case, perhaps the new owner would be more willing to make some substantive changes - like renovating the Queen St. or Bloor St. store?
AoD
UT Member
Any guesses which locations might become Lord & Taylors? And would they split a big store up to house both? See bolded text below. The gap between The Bay and Holt Renfew sounds a lot like the Eatons 3.0 experiement... I'd rather new stores (Yorkdale, Sherway maybe).
http://www.financialpost.com/story.html?id=659352
___________________________
Lord & Taylor owner buys Hudson's Bay Co.
Hollie Shaw, Financial Post Published: Wednesday, July 16, 2008
Hudson's Bay Co., Canada's oldest retailer, has been bought by the U.S. parent company of the distinguished Lord & Taylor chain.
The acquisition by NRDC Equity Partners of Purchase, N.Y., which unites North America's two oldest department stores under the same corporate structure, will see upscale Lord & Taylor launch 10 to 15 stores throughout Canada.
"Currently there is a gap in the Canadian retail landscape between The Bay department stores and Holt Renfrew," said a joint news release from NRDC and
Hudson's Bay Co., which owns The Bay, Zellers, Home Outfitters and Fields retail chains.
"Lord & Taylor will be ideally positioned to fill this consumer demand and will be located in prime locations through existing HBC real estate properties or within existing flagship Bay stores." The value of the deal was not disclosed.
Rumours of a possible sale had been circulating since April after the death of South Carolina magnate Jerry Zucker, who bought HBC in 2006 for $1.1-billion.
The deal will see a $500-million infusion of new equity into a holding company, Hudson's Bay Trading Co., that combines its retail properties including HBC, Lord & Taylor, the U.S. jewellery and home furnishings chain Fortunoff and apparel design company Creative Design Studios.
"By acquiring Hudson's Bay Co. along with previous acquisitions Lord & Taylor and Fortunoff, we will have an unprecedented opportunity to recreate the retail landscape in North America. Enormous potential exists by upgrading the offerings at both The Bay and Zellers and by bringing Lord & Taylor Fortunoff and CDS into the mix."
The strategy of the combined company is to create a greater focus on The Bay department store business in Canada and offer "better brands and better service," for customers, the release said.
Zellers will sell more branded apparel and roll out a new store prototype. CDS, a design incubator set up by NRDC to create private brands for its retail chains, will expand its offerings and sell its collections throughout North America and internationally. CDS brands include Peter Som, Kate Hill and Context.
HBC has close to 600 stores across Canada.
UT Member
By the sounds of it they'll still keep a few selected Bay stores in operation, while covert the top 15 Bay locations into Lord & Taylor.
We already know these GTA locations will be changed into a Lord & Taylor.
Yorkdale Mall
Queen St. or Bloor (Maybe they'll keep one location as The Bay and the other Lord & Taylor??)
Sherway Gardens Mall
Square One
Hillcrest
Woodbine Bay - R.I.P. - This store is destined to close down.
Administrator
When you say "we already know" you really mean "I'm pretty sure".
In my case, just to speculate on the downtown stores, I would be willing to bet that Bloor-Yonge stays The Bay, but that the Queen Street location might be split into two or even more stores. It is such a large space, that there must be some internal speculation that they could increase traffic to all sections by putting more names on the marquee. I'll advance Lord & Taylor for the east half, The Bay for the west half, and Fortunoff for a good deal of the basement. I would make the basement more identifiably a part of the Path system to encourage more pedestrian traffic to walk by. Make the bottom of each escalator shaft an entrance to each department store, and run Fortunoff along the north and west sides of the Path. Use the east and south sides of the Path for smaller stores to increase traffic.
42
UT Member
Great news! L&T would definitely attract a sizable subset of customers that shop at Holts but wouldn't be caught dead shopping at The Bay.
The Bay brands have been stagnant for decades - with a poor merchandising selection and a lackluster branding effort over the decades. The only redeeming value was their key store locations - which will obviously be used as L&T's. I wouldn't be surprised if they disposed most of their other locations in smaller markets.
It's sad to see another Canadian icon lost, but we only have ourselves to blame.
Senior UT Member
Hillcrest is a bit of a surprise - that's a for sure?
Seems like an odd location because of its size. For those who don't know, there are 2 Bays at Hillcrest, one is the clothes/watches/shoes and the other is kids stuff and housewares. My memory is failing me but one of the stores used to be a Simpsons or Sears or something.
I'm assuming L&T wouldn't want to keep the split store concept so that means selling one and doing major renos on the other, I'd presume...
UT Member
There should be a Lord & Taylor in the northern part of the GTA, I'm assuming it would be at Hillcrest then.Originally Posted by TJ O'Pootertoot
Senior UT Member
This worries me.. I wouldn't want the Bay to vacate Toronto if they take all the high profile locations...
I'm certain one of the downtown Bays would be turned into a Lord and Taylor.. whether it be the Queen or Yorkville one.. who knows. Maybe if Lord and Taylor is looking at giant renovations and a clean slate, the Yorkville location would be far better (plus the added 'location' bonus) in the heart of the high end district.
I hope we know their plans soon.
Administrator
It is not for sure - it is speculation on toforumer's part.
42
UT Member
I would think one or two in Vancouver, one in Calgary, one in Edmonton, one in Winnipeg maybe, one in Ottawa, two in Montreal, one in Quebec, one in Halifax.
That would leave a few in Toronto maybe? Yorkdale, one of the downtown ones, and Zellers at Square One? Wal-Mart might want to leave Scarborough Town Centre for an outpad to expand? They didn't say it'd be a Bay store, just a HBC location. They might do the same for malls that have a Zellers location (might see them as useless, like Calgary's Chinook, West Edmonton Mall, Metropolis and Oakridge in Vancouver, Polo Park in Winnipeg, Bayshore or Sparks Street Zellers in Ottawa, etc.), which is much more common outside of Southern Ontario. They've always seemed out of place in a shopping mall for me.
Northern GTA, Upper Canada Mall might be better, as they're becoming more upscale with more tenants that aren't plentiful elsewhere (Aerie, FCUK, Banana Republic, Forever 21, Hollister).
UT Member
I believe they are only transforming some Bay locations. Zellers is a completely different banner with a different target demographic. Lord & Taylor will be targeting the same demographic that The Bay wasn't trying but a little higher class, basically in between The Bay and Holt Renfrew. The Zellers locations are primarily in areas that fit their demographic shoppers so obviously a Lord & Taylor popping up in that area would not happen.
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