Ruby Liu’s plan for former Hudson’s Bay stores is ‘doomed to fail’, says lawyer
Ruby Liu, a billionaire looking to acquire 25 former Hudson’s Bay retail locations, faced opposition from shopping center owners during a recent court hearing in Toronto. The owners argued that Liu’s plan is destined to fail, citing unreliable financial projections and questioning her lack of experience in the retail industry.
The bankrupt retailer, Hudson’s Bay Co., is seeking court approval for a $69.1 million deal to transfer the closed locations to Liu. She intends to open stores in British Columbia, Alberta, and Ontario, but major landlords, including Cadillac Fairview Corp. Ltd., Oxford Properties, and Ivanhoé Cambridge, have expressed concerns about her suitability as a tenant.
Hudson’s Bay Co. accrued debts of nearly $1.1 billion before filing for creditor protection in March. Unable to secure financing or find a buyer to save its stores, the company closed all locations across Canada in June, resulting in thousands of job losses.
Liu, the owner of Real Estate Investment Company Central Walk, was the highest bidder for 28 lease contracts, with three of them uncontested. However, the fate of the remaining stores is now in the hands of the court.
During the hearing, lawyers representing the landlords disputed Liu’s financial predictions, claiming they overestimate income and underestimate costs. They also questioned her claim to have $400 million in funds for the new retail company, arguing that it may not be enough to cover necessary investments and operating expenses.
The landlords have a vested interest in the outcome of the lease, as Hudson’s Bay served as an anchor tenant in their shopping centers. They fear that an unsuitable tenant like Liu could devalue their properties and negatively impact other retail tenants.
Despite the opposition, Liu remains determined to move forward with her plan. Her lawyer emphasized the importance of her ambitious vision for the Canadian retail industry and the lack of alternative buyers for the Hudson’s Bay locations.
The court is expected to make a decision on the lease sale in the coming days, with both sides presenting compelling arguments for and against Liu’s proposal. The outcome of this case could have significant implications for the future of retail in Canada.
