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RAPAPORT... Hudson's Bay Company will open a full-line Saks Fifth Avenue store in Toronto, Canada at the Hudson's Bay flagship store at the corner of Queen Street and Yonge Street. The approximately 150,000-square-foot, multi-level Saks is planned to open in the third quarter of 2015 and will be co-located with the current Hudson's Bay store. Hudson's Bay agreed to sell this downtown Toronto flagship retail complex and the Simpson's Tower located at 401 Bay Street to an affiliate of The Cadillac Fairview Corporation Ltd. for $650 million. The retail conglomerate will lease back the property for a base term of 25 years with renewal options for a term just under 50 years. Proceeds of the transaction will be used to reduce debt and invest in growth initiatives. The transactions are subject to customary conditions and are expected to close on or about February 25, 2014. As part of this transaction Saks has also agreed to lease space in Toronto's Sherway Gardens for a full-line Saks store. "We're very pleased to announce this agreement with Cadillac Fairview, which clearly demonstrates the tremendous value of our dynamic real estate portfolio," said Richard Baker, Hudson's Bay CEO. "This sale-leaseback provides Hudson's Bay with resources to deleverage and accelerate investment in our growth initiatives. We continue to explore other options to create additional value through the power and potential of our real estate assets."
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