Canada Letter: The future of Winnipeg’s landmark department store

January 2, 2021

By Ian Austen

While it was already on death row, Hudson’s Bay Company’s presence in downtown Winnipeg, ended with unexpected abruptness. After announcing that its much diminished former flagship outlet would be shut in February, the retailer permanently locked the doors of the 600,000 square foot store at the end of November. Less than two weeks later, a crew arrived and stripped it of its signs.

A real estate report declared Winnipeg’s landmark Hudson’s Bay store to be worthless.Hudson’s Bay Company Archives, Archives of Manitoba

The accelerated closing was, like so much else, a result of the pandemic. Hudson’s Bay, which started in the 17th century as a fur trader, is one of many retailers knocked off kilter by shutdowns and the general economic downturn. And once life makes its gradual return to normal, Winnipeg is unlikely to find itself the only city facing post-pandemic real estate issues.

I have a soft spot for large, downtown department stores that is fueled in part by the nostalgia that surrounds them at this time of year. My grandmother sold girdles and foundations at the long demolished Smith’s department store in Windsor, Ontario. Being dropped off there to go home with her sometimes meant a slightly terrifying wait, at least for a small boy, in a stockroom filled with boxes of mysterious body-shaping garments.

But the real department store of my youth was across the river in Detroit. With 2.1 million square feet of floor space and 51 elevators, the J.L. Hudson store on Woodward Avenue made its counterparts in Toronto seem almost puny by comparison. It too is long gone.

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Like most children in Windsor, I was sure that the authentic Santa Claus could only be found on a throne in Hudson’s. (A mazelike entrance to his chamber disguised the existence of multiple Santas in multiple rooms — or at least it fooled me.)

In Winnipeg, Gordon Goldsborough, the president of the Manitoba Historical Society, told me that as a child he believed the genuine Santa was found either at the downtown Bay or its neighboring rival, Eaton’s. Although he can’t recall how he squared that duality in his mind.

In recent years, the 600,000 square foot store had been reduced to using just two sales floors.Hudson’s Bay Company Archives, Archives of Manitoba

While some retailers have thrived online and offline during the pandemic (try buying a bicycle), this year has been particularly hard on department stores and many clothing retailers. In the United States, the luxury retailer Neiman Marcus, which is partly owned by the Canada Pension Plan Investment Board, filed for bankruptcy and J.C. Penney was only saved from total collapse when two large real estate holding companies, including one controlled by Toronto’s Brookfield Asset Management, bought it mostly to ensure that space in their shopping malls remains filled.

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The Bay, which is owned by New York real estate magnate Richard A. Baker, hasn’t fallen into the same state of those two companies or many other smaller Canadian retailers. But it has been embroiled in litigation with landlords over unpaid rent in provinces where there have been shutdowns. Mr. Baker recently pulled the Bay from the stock market. An assessment of its real estate holdings was particularly grim when it came to the downtown Winnipeg store. It was valued at $0.

Unusually, it also has pushed back against closing orders. Its downtown Toronto store, which succeeded Winnipeg as the corporate flagship, briefly stayed open in late November defying shutdown orders for that city. The company claimed that it contained a “grocery store,” but the Ontario government didn’t buy it.

A court then dismissed the company’s request to have Ontario’s lockdown rules modified to eliminate the requirement that it must sell groceries to stay open or to clarify why Walmart and Costco, which both offer a wide array of food, are not required to close their doors.

The store that followed two other Bay outlets in Winnipeg when it opened in 1926 has been in a long slow decline. Its restaurants, once local institutions, shut seven years ago. A grocery store in the basement was closed long ago, and just two of its six floors remained in use with ample space between the merchandise and displays.

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“It wasn’t a matter of if the building was going to close, it was a matter of when,” said Cindy Tugwell, the executive director of Heritage Winnipeg. About six years ago, she began informally working with a group to explore potential interest among developers and possible uses for the vast building.

Hudson’s Bay and Eaton’s once defined shopping in Winnipeg.Hudson’s Bay Company Archives, Archives of Manitoba

Brian Bowman, Winnipeg’s mayor, has also set up an advisory group of his own.

While the Bay building has some protection from demolition after being designated a heritage structure, Ms. Tugwell didn’t downplay the difficulties it faces. The Eaton’s store was another local landmark. But that didn’t save it from being knocked down long after the Eaton’s chain went under to make room for the arena where the Winnipeg Jets play.

The Bay building is surrounded by empty retail space, and it’s unclear how much demand there will be for office space after the pandemic.

Renovations, which would include opening up light shafts for condominiums on the upper floors, could run as high as 120 million Canadian dollars, she said.

But Ms. Tugwell is optimistic that the Bay will live on in some new form. Mr. Goldsborough, who shares her optimism, suggests that some of it could become the home of the provincial archives which hold the Hudson’s Bay Company’s centuries of records.

“It isn’t just a Winnipeg or Manitoba landmark, it’s important to all of Canada,” she said. “Nostalgia is a big part of it but when it comes to this building, it truly is a beautiful heritage building.”

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A native of Windsor, Ontario, Ian Austen was educated in Toronto, lives in Ottawa and has reported about Canada for The New York Times for the past 16 years. Follow him on Twitter at @ianrausten.