The Metro Vancouver Retail Thread

[Sheba]

Originally Posted by GeeCee

Can't read the article due to the paywal, but how is it appalling exactly? Retail is dying and that's some of the most expensive real estate in the country.

It must be a cookie thing as it loads fine for me.

HBC invites bids for Vancouver flagship store amid investor anxiety


Hudson's Bay Co. has put its flagship store in downtown Vancouver on the auction block, a move that could fetch as much as $900-million and help appease anxious investors.

Toronto-based HBC, which runs its namesake, Saks Fifth Avenue and Lord & Taylor chains among others, has hired real estate advisers CBRE and Brookfield Financial Corp. to find a buyer for its Hudson's Bay store in downtown Vancouver to try to cash in on a hot commercial property market, industry sources say.

The move comes as HBC faces more calls for it to tap into the considerable value of its real estate, including its landmark Saks Fifth Avenue store in New York, as the retailer's stock price languishes amid disappointing financial results and an increasingly difficult retail environment.

An HBC spokeswoman declined to comment. But the six-storey, cream terra cotta building on Vancouver's Granville Street has been valued at between $800-million and $900-million, observers say.

The initiative follows HBC's deal this week to sell the building that houses its flagship Lord & Taylor store on Fifth Avenue in New York for almost $1.1-billion. The sale price was 30 per cent higher than the building's most recent appraisal value.

In an unusual series of transactions, HBC teamed up with office-sharing startup WeWork, which will convert most of the Lord & Taylor building for its own headquarters along with shared office space for others. As well, WeWork will lease the top floors of the Vancouver flagship Hudson's Bay store and two other HBC stores for WeWork's office-sharing operations. (As part of the deals, HBC will get a $632-million investment from a private-equity firm that has partnered with WeWork).

HBC's efforts to monetize real estate with WeWork will help boost productivity of the retailer's space and is "critical to its long-term success," said senior analyst Christina Boni at Moody's.

It's another step by Richard Baker, executive chairman of HBC and a U.S. real estate magnate, to find ways for investors to benefit from the retailer's lucrative property assets. The retailer has valued it real estate at $6.4-billion or $35.24 a share. HBC's stock closed at $11.04 on Friday.

But some investors are getting impatient. Jonathan Litt, founder of activist shareholder Land & Buildings Investment Management LLC, has been pushing HBC to squeeze more value from its real estate, particularly its Saks Fifth Avenue flagship, which HBC has valued at $2.9-billion. Even so, Mr. Baker has said he is not interested in selling the Saks Fifth Avenue store because of its enticing value as a luxury retailer.

Mr. Baker has made other moves on the real estate front at HBC. In 2014, HBC sold its landmark downtown Toronto store and adjacent office tower to landlord Cadillac Fairview Corp. for $650-million.

A year later, HBC formed joint ventures with Toronto-based RioCan Real Estate Investment Trust and Indianapolis-based Simon Property Group Inc. valued at the time at $4.2-billion. However, the initiatives haven't led to the properties being spun off into a separate REIT, to the disappointment of many investors.

Still, some observers question HBC's weak retail performance. Mark Petrie, an analyst at CIBC World Markets, said the retailer is on a better footing with its latest partnership with WeWork, whose office space tends to draw millennials who may also shop at the stores.

"But substantial uncertainty remains about the underlying health of the retail business," Mr. Petrie said.

HBC plans to continue operating the Vancouver store and lease it back from the new owner, as it does at the Toronto downtown store, sources said. The retailer would use the proceeds from the sale for another acquisition or to buy back shares or pay dividends to shareholders, they said.

The 650,000-square-foot historic store with Corrinthean columns features luxury women's wear the Room and prominent boutiques of such brands as Coach and TopShop.

[Waders]

Originally Posted by Sheba

That's not what the renders show. Phase 4 is roughly where the Sears is now and it clearly shows a roadway.


http://www.vancouvermarket.ca/2017/10/27/plan-emerges-for-metrotown-sears-site/

Yes, the new development wouldn't be connected to the existing mall as the City of Burnaby doesn't want that.
The newly approved Metrotown Downtown Plan calls for the Metropolis mall to be demolished and replaced by 'Metro Downtown'. See page 48 of the plan for the proposed redevelopment of the mall space. A dozen of individual street blocks are separated by new roads/streets.

Now I understand why the City of Burnaby isn't too keen to replace the old pedestrian footbridge between the skytrain station and the mall!

While it won’t be happening any time soon, the City of Burnaby has unanimously voted to take down the Metropolis at Metrotown.

When this happens, businesses and residents alike will be forced to relocate in the area or perhaps move out of the city.

Source

[NewfBC]

Originally Posted by Waders

Yes, the new development wouldn't be connected to the existing mall as the City of Burnaby doesn't want that.
The newly approved Metrotown Downtown Plan calls for the Metropolis mall to be demolished and replaced by 'Metro Downtown'. See page 48 of the plan for the proposed redevelopment of the mall space. A dozen of individual street blocks are separated by new roads/streets.

Now I understand why the City of Burnaby isn't too keen to replace the old pedestrian footbridge between the skytrain station and the mall!


Source

While it won’t be happening any time soon, the City of Burnaby has unanimously voted to take down the Metropolis at Metrotown.

I didn't know the City of Burnaby owned the mall? Or do they plan on expropriating it? That would be very expensive.

Ron.

[osirisboy]

The bay sold its Toronto flagship building in 2014 I believe and leased the space back. I dont see a big deal, Most companies lease their space

[Waders]

Originally Posted by NewfBC

I didn't know the City of Brnaby owned the mall? Or do they plan on expropriating it? That would be very expensive.

The city doesn't need to do that. Since all new development application needs to conform to the Downtown plan, that means further expansion of the mall is out of the question. And if the mall owner wants to redevelop the mall, it will need to conform to the Downtown plan.
The Sears development rendering seems to match the Downtown Plan drawing.

[SpongeG]

this popped up on facebook tonight

FROM THE ARCHIVES
How Vancouver's Woodward's could pave the future of dying department stores

Twenty-five years ago, Woodward's began its transformation from department store to mixed-use complex

By Maryse Zeidler, CBC News Posted: Oct 28, 2017 9:00 AM PT Last Updated: Oct 28, 2017 12:15 PM PT

Department store, symbol of the plight for social housing, epitome of mixed-use urban planning: there are few buildings in Vancouver as iconic and contentious as the Woodward's complex.

Since 1903, the signature "W" that swirls atop it has been an integral part of the city's downtown skyline.

Twenty-five years ago, the building began its transformation to its current form when the store's owners announced they were permanently shutting the downtown location's doors.

The closure was also emblematic of the broader struggle that department stores, like Sears, continue to face today.

But for some urban planners, the building's change is mostly a paragon of what cities can do with the vast, empty spaces retailers leave behind in their wake.

...

http://www.cbc.ca/news/canada/british-co...ure-of-dying-department-stores-1.4372506

[jollyburger]

Originally Posted by whatnext

Retail in BC is not dying, and certainly not at a flagship downtown store. Funnily enough I was at Park Royal today and it was packed, not even Christmas season yet. If you want to see how real estate asset sales play out for department stores, look up the history of Woodwards and Eatons.

Did you go into the HBC in Park Royal?

[Joat]

Are they really gonna demolish metrotown? Even if it's a long-term plan it seems like horrible idea.

[casper]

Originally Posted by Joat

Are they really gonna demolish metrotown? Even if it's a long-term plan it seems like horrible idea.

I would have thought it involves building high rises in the various parking lots on the perimeter and then interconnecting everything through the mall.

The part of the building that is the old Sears store is old. Very old. When I was a kid I remember my parents shopping there before there was a shipping mall. No ideas what shape that part of the building is in.

[Sheba]

Originally Posted by Joat

Are they really gonna demolish metrotown? Even if it's a long-term plan it seems like horrible idea.

Originally Posted by casper

I would have thought it involves building high rises in the various parking lots on the perimeter and then interconnecting everything through the mall.

The part of the building that is the old Sears store is old. Very old. When I was a kid I remember my parents shopping there before there was a shipping mall. No ideas what shape that part of the building is in.

Sadly no, they want to see the mall gone and replaced with street retail - podiums with residential towers above. It's not likely to happen in the next 20 years.

I don't get it as 'the mall' (not counting Station Square, which is still separate) merged in 2005 (according to Wiki, which sounds about right). That's when they joined the two malls into one by expanding the upper hallway and adding the lower hallway between the malls. Why would they be trying to break up the mall now when they previously wanted the opposite?

Originally Posted by Waders

The city doesn't need to do that. Since all new development application needs to conform to the Downtown plan, that means further expansion of the mall is out of the question. And if the mall owner wants to redevelop the mall, it will need to conform to the Downtown plan.

Exactly

[officedweller]

WRT Metropolis @ Metrotown
- a new south entrance would be very neighbourhood friendly streetfront entrance
- could be that Ivanhoe Cambridge was waiting to see what would happen with the Sears space / corridor before finalizing plans for the Target space. i.e. the large-ish retailers on the Sears corridor north of Centre Court could be moved into a mall-ified Target space and a new anchor could be located in a rebuilt area north of Centre Court.
- WRT the old Sears building - the former "Metrotown Centre" mall was a redevelopment of the old Sears store and Sears warehouse in the mid-1980s (that's why there's no underground parking directly below the older part of the complex). It would have been brought up to the code of the era.

************

WRT demolition of malls, that's the eventual plan for both Lougheed Mall and for Lansdowne Mall - but those are both underperforming malls.
Likewise, Champlain Mall was broken up.

*************

WRT downtown Vancouver Bay for sale
- I agree it's a short-sighted cash grab
- You look no further than HBC's sale of the Queen St. Bay store and office tower cited in the article ($650 M) and think - what's that worth now?
- If they sell off the Vancouver store, even at a premium, what will it be worth in 10-20 years time, when they could use it as collateral to secure financing?
- Lots of people have mentioned it before - as soon as a retailer starts selling off its real estate, it's the start of a downward spiral

[s211]

Originally Posted by whatnext

Appalling, simply appalling:

Hudson's Bay Co. has put its flagship store in downtown Vancouver on the auction block, a move that could fetch as much as $900-million and help appease anxious investors.



https://beta.theglobeandmail.com/report-...e-amid-investor-anxiety/article36753518/

I'm hearing that the Bay and a development group had already/previously approached the city about redevelopment, of sorts.

[trofirhen]

Well, it appears that the building will remain, and not be demolished, which, I guess is the first and most important thing.
Also, that the Bay, using reduced retail space, will operate out of the building in a lease-back arrangement with the future owners.
This a Vancouver icon if ever there was, and I just hope it remains classy and prominent. To rip it down would be like destroying Harrod's in Knightsbridge.

[Capitol Hill]

At least HBC still operates their stores as going concerns. Down here in Seattle it’s been a travesty to see how May’s has run their department stores into the ground.

[csbvan]

I hope they don't propose some stupid plan where a tower comes out of the Bay. That would be a travesty. While that can work, some buildings need to be untouchable, The Bay is one of them.

[Vin]

Metropolis mall:

Why kill the golden goose? BC municipalities come up with the dumbest ideas. Plenty of grid road neighbourhoods to redevelop nearby in Metrotown. We get a dime and dozen grid-style downtown in every big city in North America, so just leave the mall alone. The mall itself, and its surroundings are both unique in this city, and it's not like it cannot be densified further.

[s211]

Originally Posted by csbvan

I hope they don't propose some stupid plan where a tower comes out of the Bay. That would be a travesty. While that can work, some buildings need to be untouchable, The Bay is one of them.

Even if it gave you one of these?



Source: http://www.nyc-architecture.com/MID/MID124.htm

[VarBreStr18]

[QUOTE=Vin;7969577]Metropolis mall:

Why kill the golden goose? BC municipalities come up with the dumbest ideas. Plenty of grid road neighbourhoods to redevelop nearby in Metrotown. We get a dime and dozen grid-style downtown in every big city in North America, so just leave the mall alone. The mall itself, and its surroundings are both unique in this city, and it's not like it cannot be densified further.[/QUOTE
The sprawling older style mall takes up a lot of wasteful ground space. that is why Concord decides to complete revamp with highrises on top , but still has commercial podium at lower level. Also helps condo crisis , although I am sure this is the last thought on their mind. Super convenient to condo dwellers, and $$$ flying in front of developers minds.

[Vin]

Originally Posted by VarBreStr18

The sprawling older style mall takes up a lot of wasteful ground space. that is why Concord decides to complete revamp with highrises on top , but still has commercial podium at lower level. Also helps condo crisis , although I am sure this is the last thought on their mind. Super convenient to condo dwellers, and $$$ flying in front of developers minds.

Question for you: Which is more wasteful?

1. 3-storey old woodframe walk-ups and single family homes (spread out everywhere in the city. Mostly ugly with short lifespans)

OR

2. Metropolis Mall (one of a kind good quality concrete structure in this city, surrounded by high-density condos and office towers, providing shelter from our wet west-coast weather for thousands of shoppers)


Which should the city choose to renew? Take your pick.

FYI, they can still keep the mall without the street-grid AND place high density condo towers or office towers above it. Seen Oakridge mall's master plan?

[Vin]

Originally Posted by s211

Even if it gave you one of these?



Source: http://www.nyc-architecture.com/MID/MID124.htm

Absolutely! This is a classic example of a travesty. It reminds me of the bastardization of our own Stock Exchange Building.