'Where do we go from here?'

·5 min read

What happens to the state of business in a city when it loses its largest storefront in the downtown core even earlier than expected?

It’s a question being mulled by commerce stakeholders and retail experts, along with the provincial and municipal government, as the COVID-19 pandemic forces the Hudson’s Bay Company to close its downtown Winnipeg location two months earlier than previously announced.

“In light of recent restrictions on non-essential retail by the Government of Manitoba, we have made the decision to close this location,” said HBC in a statement to the Free Press Tuesday. “We remain committed to working with partners to find opportunities for this historic location that will have a positive impact on the community.”

The iconic Canadian departmental shopping chain had announced in October it would be shuttering the Winnipeg store permanently in February due to a “change in consumer behaviour.”

But by late Monday, a “closed” sign could be seen outside the mammoth, 650,000-square-foot store on Portage Avenue and Memorial Boulevard — one of the original six stores for the 350-year-old retailer before it expanded across North America.

Now, industry decision-makers and onlookers are scratching their heads about what comes next for the vacant building which has more square footage than almost all other buildings in the city.

For some, it’s prime real estate smack dab at the heart of a city that’s presenting an “opportunity” for future growth. While for others, it’s a growing concern about the “sad state of affairs” for brick-and-mortar stores.

For almost all of them, however, a mixed-use occupancy that combines residential and commercial aspects appears to be the most sensible direction for the building.

“It’s definitely an important moment in time where we can truly shape what comes next for all our businesses in the provincial hub,” said Kate Fenske, chief executive officer of Downtown Winnipeg BIZ. “Of course, this closure does have an impact on several businesses nearby because of their proximity to that space and that’s something we need to prevent from escalating.”

Citing statistics from a study conducted by the advocacy and marketing group last week, Fenske said while business is deteriorating downtown, investment in the area continues to rise and so does the possibility of new residents moving in.

Upcoming capital projects underway have a combined construction value of nearly $1 billion, according to Downtown Winnipeg BIZ numbers, including the $400-million redevelopment of the Portage Place mall right across from the Bay planned for March, 2021. And at least 18,000 people are expected to call the downtown core their home in the next two years.

“While it’s in no way surprising that the Bay chose to close, and it’s sad they’re closing even earlier than planned,” said Fenske in an interview. “How we go from here needs to use all that momentum that we still have going on here and use it for the future.”

Lisa Hutcheson, managing partner at retail consulting firm J.C. Williams Group in Toronto, said that’s easier said than done.

“Retail shopping definitely works in clusters, I mean that’s the whole concept behind having a mall to begin with — to have several stores conveniently in one place,” she said Tuesday.

“But now the real question is, where do we go from here when that concept has itself become outdated and is causing closures like this? That’s difficult to answer.”

Hutcheson believes the novel coronavirus “only magnified and worsened the inevitable,” given the overall lack of foot traffic in suburban-style malls and an evolving shift to online commerce seen well before the pandemic.

“I do still think that if we found a good blend of mixed-use purpose for the building, it would be of great value,” she said. “It’s just that that’s the type of project which is pretty difficult to convince someone to take on right now.”

Last year a company-wide valuation of HBC’s real estate holdings valued the downtown Winnipeg building at precisely $0. Over the years, the company has closed some of the store’s six floors along with its basement, consolidating stock on just two levels.

Dayna Spiring, president of Economic Development Winnipeg, said her conversations with the province and the city have given her ample reason to be optimistic.

“There’s so much potential here, it’s hard not to be hopeful about what can be done with that space especially with consultation from the community at large,” she said. “The opportunity is massive.”

In statements to the Free Press, provincial and municipal spokespersons said both government levels are open to hearing development proposals in the future that “include an adaptive re-use of the building and conservation of the character-defining elements.”

A city spokesperson said the mayor is “currently engaged in outreach with community stakeholders in this regard.”

But Spiring said she doesn’t believe the building will ever remain the way it is right now. “You’re likely looking at getting rid of the guts and almost a complete reimagination of the space for it to be successful,” she added.

“We just have to get through this pandemic first to make those kind of decisions.”

Hudson’s Bay Co. continues to serve Winnipeggers at its Polo Park and St. Vital locations, as well as online at thebay.com.

Temur Durrani, Local Journalism Initiative Reporter, Winnipeg Free Press