Hudson’s Bay Company teams up with Simon Properties, RioCan to form real estate ventures worth $4.2 billion
TORONTO – Through his latest act of financial wizardry, Hudson’s Bay Co. governor Richard Baker has transformed the country’s oldest department store chain into one of its most nimble real estate operators.
It has been a process in the making since the savvy Greenwich, Conn.-based real estate investor bought out the then-limping HBC in 2008 and proceeded to make a series of methodical chess moves to get the retailer out of its least attractive properties and pour those proceeds into more valuable properties, most notably the US$2.9-billion purchase of Saks Fifth Avenue in 2013.
HBC announced Wednesday it was partnering with the biggest real estate investment trusts in the United States and Canada to form joint venture deals worth $4.2 billion. Setting up joint ventures, rather than spin off HBC’s real estate holdings into its own REIT, will allow the department store retailer to diversify credit and enable the ventures to potentially acquire more real estate holdings before taking them public, Mr. Baker said.
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