Malls seek new tenants

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Close to half a million square feet of retail space is expected to flood onto the Winnipeg market in the next four to five months as Target withdraws from Canada, and one of the big questions is what will fill that space.

Several landlords contacted Thursday said they had no warning of the announcement Target plans to close all 133 of its Canadian stores.

“So it’s too early to speculate on what we might backfill that space with,” said Kildonan Place Shopping Centre general manager Peter Havens. “In the meantime, it’s business as usual.”

It was a similar story at Grant Park Shopping Centre. “We don’t have anything to announce right now,” general manager Sandra Hagenaas said. “We’re just going to keep doing what we do… and it will unfold as it unfolds.”

Target has four big-box stores in Winnipeg: a 120,000-square-foot outlet at Grant Park, a 123,000-square-foot store at Kildonan Place, a store in Southdale Centre, and a 107,000-square-foot outlet in the new Plaza at Polo park retail/office development on the former football stadium site at Polo Park. It also has a big-box store in Brandon.

A spokesperson said the company doesn’t know when each store will close, but it’s expected they’ll all be gone within four to five months.

A typical Target store employs between 100 to 150 people. So that means anywhere from 500 to 750 workers will lose their jobs.

Some local retail-leasing specialists were willing to speculate Thursday on possible replacements for Target. Most of the names being tossed around are either other U.S. retailers rumoured to be considering expansion into Canada, or ones already here that are looking for additional sites.

They said Target’s failure won’t deter other U.S. retailers from coming to Canada.

“I don’t see that as being a discouraging thing,” said Ken Yee, senior vice-president in the Winnipeg office of Cushman & Wakefield.

“I think any retailer big and strong enough to look at the Canadian market is going to look at it and say, ‘It was not so much the Canadian consumer rejecting the American retailer. It was how the American retailer chose to cater to the Canadian consumer.’ “

Yee and Wes Schollenberg, managing partner of Avison Young Commercial Real Estate (Manitoba) Inc., said the shopping centres will likely try to find another anchor tenant, but if one can’t be found, another option would be to subdivide the space into smaller units, similar to what Polo Park Shopping Centre did with its former Zellers store.

“The landlords and developers will figure it out,” Yee added.

Schollenberg predicted it could take a couple of years to backfill all of the space.

“These things don’t happen overnight…”

Yee noted Nordstrom was one of the U.S. retailers being courted several years ago for the ill-fated The Elms retail development on the former stadium site. Quebec-based fashion retailer Simons was another.

“They (Nordstrom officials) are mindful of the affluence of the marketplace, so you’ve got to kind of pass that test first,” Yee said. “But I would say Nordstrom’s view or flavour for Canada has evolved over the years, so maybe the timing is right.”

Simons CEO Peter Simon said in an email, “We are actively working on our expansion plans with five new locations opening in the next 21/2 years.

“(Target’s) announcement may offer additional expansion opportunities, but it will take some time to determine feasibility. For us, it’s about finding the right location and partners for Simons.”

A spokesman for one of Plaza at Polo Park’s co-developers — Shindico Realty Inc. — said Thursday he’s confident a replacement tenant can be found for the Polo Park store, which is owned by Target.

Shindico development manager Bob Downs said he knows several retailers that are looking for a store of that size in Winnipeg.

Yee said he wouldn’t be surprised to see Walmart give up its Empress Street location and move into the Target space in the Plaza at Polo Park development.

However, a Walmart spokesman said it’s too early to speculate on whether it would assume any of the Target locations.

murray.mcneill@freepress.mb.ca

Archival video: New Target store at Kildonan Place - May 6, 2013

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