As Hudson’s Bay winds down its footprint across Canada, a little-known businesswoman from B.C. is seizing its retail locations — with bold ambitions that retail experts say could come with significant risk.
While the Canadian retail icon sold its intellectual property for $30 million to Canadian Tire, it entered an agreement with Weihong Liu, chairwoman of shopping mall owner and operator Central Walk, to reassign 28 Hudson’s Bay leases for the launch of “a new modern department store concept.”
Some retail experts are excited about the emergence of a new retailer — and the potential to save thousands of jobs — but they also acknowledge that Liu has a complex road ahead, from building a brand from scratch to transitioning to retailer from landlord.
“I wouldn’t bank on her succeeding until I see more,” said B.C.-based retail consultant David Ian Gray.
Liu has not disclosed details of her business plan or the specific locations of the 28 leases across Ontario, Alberta and British Columbia. The reassignment is subject to landlords’ consent and court’s approval.
Not another Hudson’s Bay
Lisa Hutcheson, a retail adviser based in Toronto, said that the future of the 28 retail locations that Liu bid on will not be another Hudson’s Bay given she does not own the brand’s name and trademarks.
“She just bought the real estate. It will be something completely new, which is also very exciting,” Hutcheson said.
She expects Liu’s stores will still have the various offerings and meet the definition of a department store — a requirement in the vast majority of Hudson’s Bay lease agreements.
The billionaire who also goes by the name Ruby Liu is no stranger to the Canadian market.
As an immigrant and entrepreneur from China, Liu bought three shopping malls on the west coast including Tsawwassen Mills Mall, just south of Vancouver, Mayfair Shopping Centre in Victoria, and Woodgrove Centre in Nanaimo after moving her company Central Walk’s headquarters to Canada from China in 2020.
Central Walk said in a press release Friday that it wants to build a multiculturalist community that bridges the gap between generations and provides immersive shopping experiences.
“I think what she brings to the table is sort of the recognition that for retail to be successful in brick-and-mortar, to be successful, there has to be excitement,” said retail analyst Bruce Winder, adding that her malls have hosted fashion shows and dance lessons — offering more than just shopping.
‘A high-risk play’
While Winder found her vision interesting, he said this is not a “slam dunk by any means” and that Liu faces major challenges, starting from the financial commitment to pay the rent of the 28 leases.
The broken escalators and other aging infrastructure in the closing Hudson’s Bay stores will also require significant investment.
“This is not for the faint of heart. This is a high-risk play,” he said.
David Soberman, a marketing professor at University of Toronto, echoed the sentiment and said he would be surprised if Liu plans to run each of the 28 stores under the same umbrella brand name unless it’s a known brand. But he also doesn’t see a market opportunity for American or European retailers to come in.
“All the major retailers started small. They had a concept, and they started being successful, and then they expanded,” said Soberman. “Most retailers don’t suddenly buy 28 massive areas and then suddenly come up with a new brand.”
Liu said in a recent video on Rednote, a Chinese social networking and e-commerce platform, that she wants to operate stores under the name “New Bay” and showed what appeared to be an early logo for her envisioned retail brand: a bold, red diamond stamped with her name, “Liu.”
“I hope she doesn’t do this,” said Winder. “That’s a mistake. I think she would be litigated by Canadian Tire.”
Winder added he would recommend Liu develop a prototype first and test it before building 27 other stores.
East meets West
Liu’s background running a shopping mall in Shenzhen, China — which sold for more than $1 billion in 2019 — has led some retail experts to believe she may bring the experiential elements common in Asian retail to Canada.
Winder said malls in China tend to feature gamification, tech-driven experiences, and a strong focus on community building.
But retail strategist Gray warned that simply copying the successful retailers in China would not work in Canada and Liu needs to know how to “win over the Western audience.”
”(In China), you could grow your business simply by new customers coming in, whereas in North America, especially for department stores, it’s so mature, actually in decline,” said Gray. “You have to take it from somebody else’s business. It’s not like there’s a net new market.”
From landlord to retailer
Gray said Liu will also face a big shift from being a landlord with multiple shopping malls to a retailer running a department store.
Managing 28 locations will require a more complex organizational structure and expanded staffing, which could test Liu’s leadership experience, he said.
“Landlords are transactional,” said Gray. “It’s about filling space with leases, and retail is so much more, with audience involvement every single day.”
He added that if Liu doesn’t have that experience, she could hire someone who has “international exposure and is willing to try some new things.”
