Hudson’s Bay is relinquishing its former stores to landlords, effectively ending B.C. billionaire Ruby Liu’s pursuit to acquire the collapsed retailer’s leases. Franco Perugini, HBC’s senior vice-president of real estate and legal, mentioned in an email to The Canadian Press that the company is disclaiming the leases it held for 25 properties Liu sought to purchase. A disclaimer is a legal tool that terminates a lease prematurely, freeing the tenant from obligations like rent payments and property upkeep. Perugini stated that unless a landlord contests the disclaimer, the HBC leases will be terminated on Nov. 27.
Linda Qin, a spokesperson for Liu, did not immediately respond to a request for comment on the disclaimers. HBC vacated its 80 stores and 16 more under its Saks banners during the summer after filing for creditor protection and liquidating its inventory. Liu aimed to acquire up to 28 leases when HBC put them up for sale to establish a new department store bearing her name.
HBC swiftly gained court approval for Liu to purchase three leases in B.C. malls she owned, namely Woodgrove Centre, Mayfair Shopping Centre, and Tsawwassen Mills. However, the remaining 25 leases faced fierce opposition from landlords such as Cadillac Fairview, Oxford Properties, and Ivanhoé Cambridge. They rejected Liu as a tenant, arguing her business plan was inadequate and she lacked experience, despite offering $69.1 million for the leases.
Liu contended she was capable of assuming the leases and committed to investing millions in hiring, inventory procurement, and site renovations. HBC, laden with creditors owed approximately $1.1 billion at the start of its wind-down, viewed Liu as a potential means of recovering some of the owed funds. Nevertheless, a judge ruled in favor of the landlords last month, expressing doubts about Liu’s ability to meet lease terms.
Following the court ruling, HBC did not indicate whether it would appeal, but the lease disclaimer suggests it will not pursue the sale further. Josh Burleton, an Oxford Properties spokesperson, mentioned in an email on Monday that HBC’s decision to disclaim the leases brings clarity to the prolonged and costly process, enabling progress. Oxford Properties, the real estate arm of the Ontario Municipal Employees Retirement System, is focused on safeguarding assets that support employees and pensioners.
