An Ontario court approved the sale of three Hudson’s Bay Company store leases to billionaire B.C. mall owner Weihong Liu Monday, but lawyers for other landlords whose leases she’s also bidding on blasted a “very troubled” process and lack of information.
Ontario Superior Court judge Peter J. Osborne approved the sale of three leases for stores in malls Liu already owns.
Liu is seeking to buy 28 leases from the insolvent department store chain.
Landlords for at least 23 of the other 25 have objected to her purchase plans, according to documents filed with the court last week.
Monday, a lawyer for mall owner Cadillac Fairview criticized the sale process.
“The landlords are all uncomfortable with the lack of information,” said David Bish, a partner at Torys law firm. “The process has been very troubled.”
D.J. Miller, a partner at Thornton Grout Finnegan, acting for Oxford Properties said “there are many troubling aspects about the lack of information.”
A lawyer for Liu said she was helping put money in the pockets of HBC’s creditors, as well as putting forward a bold new retail vision.
“She is contributing millions of dollars of real value to the Companies’ Creditors Arrangement Act process,” said David Ward, a lawyer representing Liu. “She is betting on herself.”
As he spoke, Liu and an entourage of her staff looked on from the gallery.
Earlier that morning, she arrived clad in a stylish black blazer and high heel boots, carrying a Louis Vuitton purse.
She posed for photos beside the court coat of arms and told media she was planning to move to Toronto.
The sale of some Hudson’s Bay leases comes after the storied department store filed for creditor protection in March, a few months shy of its 355th birthday.
In the months after, it looked for a buyer who could keep some semblance of the retailer alive, but the search was fruitless.
By June 1, all 80 Bays and 16 stores run under the Saks brands closed, putting their leases up for grabs.
A dozen bidders made offers on a collective 39 properties.
Liu, who made her money in China’s real estate market, wound up winning the leases at three malls she runs because her bid had a superior value and terms, the Bay has said.
Anyone who made an offer for leases had to make a deposit of 10 per cent of their estimated purchase price.
Court documents show Liu made a deposit of $9.4 million, in addition to $6 million for the three approved leases, which would equate to a purchase price of $100 million for 28 leases.
“That is not really a business plan, that is a full-circle investment,” Liu’s lawyer Ward said in recommending the court accept the three-lease deal.
The remaining 25 leases are in Alberta, B.C. and Ontario properties she doesn’t own.
The Bay has yet to seek court approval for the arrangement, but landlords for the spaces are overwhelmingly opposed to her moving in.
In an interview with the Star’s Estella Ren last week, Liu claimed that she has faced “discrimination” and “rude treatment” while seeking landlord consent for the leases she hopes to acquire.
Liu said she met with five or six landlords in early June, and most were friendly — but one representative from a major Toronto landlord whom she refused to name was “extremely rude” and “stormed out” after just five or six minutes, making it clear he did not support Liu’s proposal.
The Star was not able to independently verify this claim.
“I was treated unfairly and rudely — you could even call it outright discrimination,” Liu said. “They told me I had no experience and no track record.”
She pushed back on that view, arguing that even Hudson’s Bay, despite being founded in 1670 and conducting business for more than 300 years, still ended up shutting down.
What truly matters, she said, is understanding consumers.
With files from Estella Ren and The Canadian Press
