Winnipeg Retail

[GarryEllice]

Hi all, been lurking here since I moved to Winnipeg from Toronto a year and a half ago.

Originally Posted by CoryB

One final comment for today, tomorrow (April 10) is the opening day for No Frills on Notre Dame.

I checked it out today and was pleasantly surprised by how nice it is, especially considering how soul-crushing the No Frills stores in TO can be. They actually took some care with the decor and lighting. The range of products is excellent, too; it's certainly not all low-end No Name stuff. Aside from the absence of service counters it almost feels more like a little Loblaws than a No Frills.

It was really busy and they had people bagging groceries, although I'm guessing that a "frill" like that is just for the opening.

[vjose32]

Maybe the Sears Home store is expanding so they can move Sears out of the mall?

[CoryB]

The new construction at St James and Ellice appears to be more free style building than an expansion of the Sears Home. Also, if Sears was moving out of Polo Park there would be an announcement of them selling the lease much like when they sold Pacific Center in Vancouver to Nordstrom.

The state of Sears globally is such that every lease is for sale at a price, even more so than that is a general rule. There is absolutely no way Sears walks away from Polo Park unless they are forced out or completely out of business.

[Simplicity]

Originally Posted by CoryB

The new construction at St James and Ellice appears to be more free style building than an expansion of the Sears Home. Also, if Sears was moving out of Polo Park there would be an announcement of them selling the lease much like when they sold Pacific Center in Vancouver to Nordstrom.

The state of Sears globally is such that every lease is for sale at a price, even more so than that is a general rule. There is absolutely no way Sears walks away from Polo Park unless they are forced out or completely out of business.

With rumors abound over the last few quarters that Sears has run out of credit terms with its suppliers, how long does Sears seriously have? Even if those rumors aren't entirely true on the face there's some smoke there. And if you're at that point, it's only a matter of time.

I'd be surprised if Sears isn't wound down in the next 3-5 years.

[CoryB]

Originally Posted by Simplicity

I'd be surprised if Sears isn't wound down in the next 3-5 years.

I have been saying the same thing for about three years now yet they keep pulling rabbits out of their hat. My understanding is Sears Canada is legally a separate company from Sears in the United States but that US Sears owns over 50% of Sears Canada and has heavy say in its operation.

For a little background, around 2004 in the US the economy was on a major downswing. Kmart feeling the brunt of these effects entered bankruptcy and closed lots of locations. Around the time they were exiting bankruptcy Kmart acquired Sears, yes not the other way around. Since then both chains have continued to struggle and are actively working to sell of portions of or entire leases. As long established chains anchoring developments many of these properties have very favourable terms relative to signing leases for similar space today.

The lingering cash flow issues from the US has started to ripple into the chain in Canada. Over the past few years it has sold off some leases here for its more desirable properties, ie Pacific Centre in Vancouver which became a Nordstorms flagship. They have also shuttered retailer floors and converted them to corporate offices (Eatons Centre in downtown Toronto). They have also sold off their shares in fully enclosed malls (Kildonan Place). This is all being funnelled into basically keeps doors open and lights on. There is only so long this can go on for.

In my personal list I had Sears closing around the time Target Canada did. I did not see Target's closing coming but at the same time it was not unexpected as they made a number of errors of their own (ie operational losses versus having lose leaders to get people in the stores).

All that said, at this point I would not be the least bit surprised to see Sears close tomorrow or to be having a similar conversation in two years time.

On a completely separate front, one day I will type up how Sears entrenchment in their 1950s way of doing business is one of the biggest missed opportunities of the ecommerce world.

[esquire]

^ At this point, Sears has become so irrelevant that one might wonder if anyone would notice if they disappeared. The funny thing is that they're actually fairly good at what they do... there are some specific demographics that you would think would flock to Sears (seniors, families with children, rural residents who use mail order/agent stores, the working classes generally), but for whatever reason they seem to be dropping out of the public consciousness. I wonder if lack of effective marketing is a culprit... other than the odd flyer bundled with the newspaper, I rarely ever hear or see anything about Sears.

Frankly, I'm a little surprised that none of the Winnipeg locations have been axed yet, although it appears that the Garden City store has reverted to being a clearance centre. They did that once before back in the 2000s before turning it back into a regular outlet.

[Simplicity]

Originally Posted by CoryB

I have been saying the same thing for about three years now yet they keep pulling rabbits out of their hat. My understanding is Sears Canada is legally a separate company from Sears in the United States but that US Sears owns over 50% of Sears Canada and has heavy say in its operation.

For a little background, around 2004 in the US the economy was on a major downswing. Kmart feeling the brunt of these effects entered bankruptcy and closed lots of locations. Around the time they were exiting bankruptcy Kmart acquired Sears, yes not the other way around. Since then both chains have continued to struggle and are actively working to sell of portions of or entire leases. As long established chains anchoring developments many of these properties have very favourable terms relative to signing leases for similar space today.

The lingering cash flow issues from the US has started to ripple into the chain in Canada. Over the past few years it has sold off some leases here for its more desirable properties, ie Pacific Centre in Vancouver which became a Nordstorms flagship. They have also shuttered retailer floors and converted them to corporate offices (Eatons Centre in downtown Toronto). They have also sold off their shares in fully enclosed malls (Kildonan Place). This is all being funnelled into basically keeps doors open and lights on. There is only so long this can go on for.

In my personal list I had Sears closing around the time Target Canada did. I did not see Target's closing coming but at the same time it was not unexpected as they made a number of errors of their own (ie operational losses versus having lose leaders to get people in the stores).

All that said, at this point I would not be the least bit surprised to see Sears close tomorrow or to be having a similar conversation in two years time.

On a completely separate front, one day I will type up how Sears entrenchment in their 1950s way of doing business is one of the biggest missed opportunities of the ecommerce world.

This is a great summation of things.

I feel like Sears is going to be operational one day and in creditor protection the next. The supply chain requires that you keep your dirty laundry hidden for as long as you can until one day you can't. That'll be Sears.

The retailing environment is just simply not sustainable. Everybody in the business - labour, manufacturers, wholesalers - have taken a haircut. The landlords won't survive without one either.

[Riverman]

Originally Posted by esquire

^ At this point, Sears has become so irrelevant that one might wonder if anyone would notice if they disappeared.

Had to go to SOGH this morning so I stopped in to Sears GC to buy a new belt. There were four belts for sale. Four.

[Jammon]

Originally Posted by Riverman

Had to go to SOGH this morning so I stopped in to Sears GC to buy a new belt. There were four belts for sale. Four.

Sears GC has become the liquidation world of Sears. Last time I was in there, it was quite literally a mess. It's a disgrace really..

[CoryB]

Originally Posted by esquire

^ At this point, Sears has become so irrelevant that one might wonder if anyone would notice if they disappeared.

In the States Sears actually run advertising suggesting people park by their stores when visiting other places in the mall as they always has lots of spots available. Clearly the message was geared to getting wallets at least walking through their stores in hopes they would buy anything.

Originally Posted by esquire

Frankly, I'm a little surprised that none of the Winnipeg locations have been axed yet, although it appears that the Garden City store has reverted to being a clearance centre. They did that once before back in the 2000s before turning it back into a regular outlet.

Garden City basically slid from a full line store to a clearance outlet likely around 2003-2004 when the US economy tanked and they needed somewhere to dump product, and dump did they ever do. About six years ago the store underwent a major renovation, the first in more than 30 years. After the renovation was completed they converted to a "full line" store. People had become so used to it being a dumping ground of heavily discounted items though it didn't stick for long (about 18 months?) before it reverted to the clearance outlet. Under its first run it was one of about three such stores in all of Canada. I would suspect the rent at that location is among the lowest in their entire chain.

In terms of Winnipeg locations closing, I am truly shocked that Polo Park is still in operation. Granted it is easily the chains' highest profile location in the city but it is also the most valuable. I haven't crunched the square footage numbers for a while but it could have made sense to say put H&M on the second floor and have Simons move into the main floor. It could also be a catalyst for a possible expansion to the south bring the mall to front onto Portage Ave. That said the H&M found a home elsewhere in the mall, Simons seems busy with other cities and the creeping upward vacancy rate on the mall has likely iced in possible expansion plans.

Separately, the Winnipeg location I would be most worried about is Kildonan Place. Losing that anchor shortly after Target could end of sinking that whole mall. I have said it before, if you want an example of what losing an anchor can do look at what happened in Grand Forks when Target left the mall. It might not be time for KP to hit the panic button just yet but they should at least have their finger on it already.

PS St Vital will be a different issue but Forever 21, H&M, Zara and Top Shop might all be interested in larger foot print space in Winnipeg's second largest mall. The challenge will be the second floor with no direct mall access.

[northern_hoser]

Originally Posted by CoryB

In the States Sears actually run advertising suggesting people park by their stores when visiting other places in the mall as they always has lots of spots available. Clearly the message was geared to getting wallets at least walking through their stores in hopes they would buy anything.



Garden City basically slid from a full line store to a clearance outlet likely around 2003-2004 when the US economy tanked and they needed somewhere to dump product, and dump did they ever do. About six years ago the store underwent a major renovation, the first in more than 30 years. After the renovation was completed they converted to a "full line" store. People had become so used to it being a dumping ground of heavily discounted items though it didn't stick for long (about 18 months?) before it reverted to the clearance outlet. Under its first run it was one of about three such stores in all of Canada. I would suspect the rent at that location is among the lowest in their entire chain.

In terms of Winnipeg locations closing, I am truly shocked that Polo Park is still in operation. Granted it is easily the chains' highest profile location in the city but it is also the most valuable. I haven't crunched the square footage numbers for a while but it could have made sense to say put H&M on the second floor and have Simons move into the main floor. It could also be a catalyst for a possible expansion to the south bring the mall to front onto Portage Ave. That said the H&M found a home elsewhere in the mall, Simons seems busy with other cities and the creeping upward vacancy rate on the mall has likely iced in possible expansion plans.

Separately, the Winnipeg location I would be most worried about is Kildonan Place. Losing that anchor shortly after Target could end of sinking that whole mall. I have said it before, if you want an example of what losing an anchor can do look at what happened in Grand Forks when Target left the mall. It might not be time for KP to hit the panic button just yet but they should at least have their finger on it already.

PS St Vital will be a different issue but Forever 21, H&M, Zara and Top Shop might all be interested in larger foot print space in Winnipeg's second largest mall. The challenge will be the second floor with no direct mall access.

Everytime I've gone to Columbia Mall, I think to myself that it reminds me of KP. From what I remember, Columbia Mall took a bit of a hit after Target moved across the street and that end of the mall was a dead end. Biggest difference between the two malls though is that there were three other anchor Tenants - JC Penny, Sears and Macy's. Scheels has now opened up in Target's old footprint.

[vjose32]

I don't think people were flocking to KP just because it had a Target or has a Sears, neither one seems to have a lot of customers anyway. If it was a Walmart with all their thousands of customers a day, then I could see that having more of an impact on a mall.

As for access to the second floor of Sears at St. V, that shouldn't be too difficult. Just expand the mall into Sears and have stairs leading up from there. There are probably other solutions to that problem as well.

As for the suggestion of H&M to Sears in Polo Park, H&M would not fill an entire floor of Sears, it's too small. I'm not sure how Simons could fill up an entire floor either but apparently they do.

It's a real shame Target made so many mistakes, they should fire some corporate idiots and hire people who know what they are doing. Spending millions on new stores, like the one in Polo, was ridiculous. They should have just opened one in Northgate. Would have helped out the area and would have saved them a boatload of money and would have serviced the same area. Not too mention all their other mistakes. They should have only started off with a few stores and then expanded, not opened like 100 at around the same time. Another mistake imo was shutting down completely. They should have, could have, shut down some locations to cut costs, but shouldn't have just given up on Canada completely. I believe it was said that they would return to profitability in 5 years, so it was just a matter of time and they would turn things around. Now they just end up with a bunch of losses instead.

[vjose32]

Anyone know anything about this store coming to Canada?

http://www.retail-insider.com/retail.../2014/6/uniqlo

[Danny D Oh]

Originally Posted by vjose32

I don't think people were flocking to KP just because it had a Target or has a Sears, neither one seems to have a lot of customers anyway. If it was a Walmart with all their thousands of customers a day, then I could see that having more of an impact on a mall.

That's an interesting point about KP. That's the area I grew up in so I have a pretty good memory of that mall back to the early 90s, and the anchors have always been duds. Sears and The Bay/Zellers/Target. They were mostly a big void to walk through on the way to the mall for my entire existence. Never many customers. That restaurant space at the front of the mall has always had difficulty holding a tenant. Even the movie theatre at KP has been a dump for 20 years. Rarely would we go to movies there even as teenagers.

In some ways it is very odd that KP has avoided becoming Garden City-esque, half-dead.

[laumag]

Originally Posted by Danny D Oh

That's an interesting point about KP. That's the area I grew up in so I have a pretty good memory of that mall back to the early 90s, and the anchors have always been duds. Sears and The Bay/Zellers/Target. They were mostly a big void to walk through on the way to the mall for my entire existence. Never many customers. That restaurant space at the front of the mall has always had difficulty holding a tenant. Even the movie theatre at KP has been a dump for 20 years. Rarely would we go to movies there even as teenagers.

In some ways it is very odd that KP has avoided becoming Garden City-esque, half-dead.

I worked at Sears Garden City on Opening Day 1970 and for a bit afterwards. It was quite the store back in its day. Garden City Mall was always crowded on any given Saturday afternoon in the seventies/eighties. I believe from my email communications with the GCSC RioCan property manager that the mall still registers high numbers in traffic. I prefer malls when the temperature outside is frigid. Power Centres annoy me. I do not want to drive from one store to another one across the street to a grocery store down the block. I want to drive to a Mall, park and do what I have to do in climate controlled comfort. I was pleased to read that the Outlet Collection at Winnipeg will be enclosed.

Regarding KP, I was the one that drove there just to shop at Target. I agree with the statement made earlier that Target should not have "run off with their tail between their legs" leaving Canada totally. I believe that if they had actually had some sort of plan they would have closed the majority, but would have kept at least one in the top markets operating until they got a better idea of what is necessary to succeed in a country not really the same as the United States. Sad. I just cut up my Red Card.

[CoryB]

I really feel that Garden City's decline was heavily driven by the opening of the Chief Peguis Trail bridge. Before that time Garden City was well isolated from north-east Winnipeg and Polo Park had yet to come into its retail boom. People tended to go to the enclosed mall closest to their house and not really drive across the city to another mall. The opening of Chief Peguis Bridge changed that to some extent. Suddenly the Garden City area found itself almost perfectly in the middle of Polo Park and Kildonan Place. KP and Polo Park themselves were relatively separated into the "east" and "west" sides of Winnipeg. This was witnessed with the opening of the first two Costcos but others would follow.

Even then Polo Park was still pretty quiet with only Safeway for groceries, the same with KP. More stores followed opening "east" and "west" locations and increasing forced traditional Garden City area shoppers to go to other areas. Eventually more of the big stores followed into the east and west model to the point when you need something from Rona conveniently Superstore and Walmart were both nearby. Those shops also conveniently located close the the mall in case you needed to go there as well.

Before its sharp decline started, available space in Garden City was an issue too with retailers who might have gone there needing to locate in a different mall or skip the area all together. Eventually customer traffic declined at Garden City and the larger stores started leaving that mall which caused its decline in importance to accelerate.

Through all this St Vital was a bit of a special case. The limited land for commercial development in the area held the "south" node back some in its development. Ultimately the rise of the south-west lead to the spilt focus we currently have between St Vital and Kennaston. The distance from KP and the traffic issues between the area and Polo Park though worked to isolate it in ways Garden City never benefited from.

So next time you want to remember Garden City Shopping Center fondly curse the Chief Peguis Bridge for bring an end to it importance.

[cllew]

Originally Posted by CoryB

I really feel that Garden City's decline was heavily driven by the opening of the Chief Peguis Trail bridge. .....

.... So next time you want to remember Garden City Shopping Center fondly curse the Chief Peguis Bridge for bring an end to it importance.

Its interesting you say that as I remember the lady who was the Garden City mall manager at the time saying to one of the news papers they welcomed the Chief Peguis bridge opening as it would allow customers from the east side of the river easier access to the mall.

She thought that customers on the East side of the river did not go there as much because they had to go over the Redwood bridge or Perimeter bridge and the new bridge made it more convient for them.

[cllew]

Here is an interesting study on the state of retail in Winnipeg published by the U of W Institute of Urban Studies up to 2002

http://www.uwinnipeg.ca/faculty/ius/...%20-%20PDF.pdf

[vjose32]

Well the Kenaston outlet mall is one step closer to reality.

http://www.cjob.com/2015/04/15/co-2/

[trebor204]

The plans are posted on City of Winnipeg Website.

http://clkapps.winnipeg.ca/dmis/View...onId=&InitUrl=

See Report #16 / Outlets of Seasons Plans