A top executive from real estate brokerage Avison Young says the former Hudson’s Bay department store on Rideau Street will likely attract interest from a “wide variety” of users as downtown revitalization efforts gain steam and new retailers in nearby properties draw more traffic to the area. Hudson’s Bay stores across the country officially closed […]
Already a Subscriber? Log in
Get Instant Access to This Article
Become an Ottawa Business Journal Insider and get immediate access to all of our Insider-only content and much more.
A top executive from real estate brokerage Avison Young says the former Hudson’s Bay department store on Rideau Street will likely attract interest from a “wide variety” of users as downtown revitalization efforts gain steam and new retailers in nearby properties draw more traffic to the area.
Hudson’s Bay stores across the country officially closed their doors on June 1 after the iconic retailer filed for creditor protection in March and failed to find a buyer to keep it alive.
That leaves a gaping hole in the Rideau Street retail landscape, where the department store chain operated its five-storey, 335,000-square-foot flagship location in Ottawa.
However, Avison Young’s managing director for Ontario, Joe Almeida, thinks there will be no shortage of potential tenants looking to occupy the Bay’s former digs.
The ByWard Market and surrounding area are showing signs of renewed life, he said. New retailers such as up-and-coming Montreal furniture chain Cozey have recently set up shop on Rideau Street, and Live Nation’s 2,000-seat live performance venue, History Ottawa, is slated to open next door to the vacant Bay store in the former Chapters space in early 2026.
“Talking to some of our clients in that market, there’s definitely demand there,” Almeida told OBJ in an interview on Thursday.
“The landlords are going to have to be part of the solution in terms of reimagining how that space might be best suited for today’s market. It’s one of the best locations in the city. We expect that there will be demand from a wide variety of (users).”
Hudson’s Bay owned 78 per cent of the former Rideau Street store, with RioCan Real Estate Investment Trust controlling the remaining 22 per cent as part of a joint venture. Earlier this month, the Ontario Superior Court of Justice approved RioCan’s application to put the joint venture – which included 12 properties from across Canada that the department store leased from the partnership – into court-supervised receivership.
FTI Consulting Canada Inc. has been appointed as receiver. RioCan says it will continue to manage the properties and will work with FTI to “preserve and maximize” their value through measures such as “dispositions, re-leasing and advancing potential redevelopment opportunities of individual properties.”
Although B.C. billionaire Ruby Liu is looking to turn some of the 80 former Bay stores in other locations into a new chain of department stores, Almeida doubts anyone will try the same approach in downtown Ottawa. He expects the Rideau Street space to eventually be split into smaller parcels that will be leased to various different types of businesses.
“Are we going to see somebody take up the entire space with a similar use? That’s probably not going to be the case,” he said.
Landlords at other Canadian retail properties where large tenants have pulled up stakes have turned to a variety of users to fill the gaps.
For example, in the West Edmonton Mall, an old Sears building was chopped into smaller storefronts as well as a car dealership. Meanwhile, the Eaton Centre in Toronto is filling the footprint left behind by Nordstrom with Italian restaurant Eataly, a new Nike store and Quebec fashion retailer Simons.
Earlier this year, Toronto-based retail analyst Bruce Winder told OBJ other malls have turned to even more creative solutions for backfilling vacancies, such as installing pickleball courts. Winder also brought up another possibility – converting the Bay’s old Rideau Street digs into housing.
“The Bay is arguably one of the focal points of the ByWard Market,” he said in an interview in March. “It’s a beautiful store. But if you’re a landlord, what are you going to put in that building? You might be able to argue, okay, the building is self-contained so you might be able to make it into condominiums. But I really doubt there’s any retailer that’s going to be able to come and take all the space.”
Almeida says it’s still too early to predict how the property will be repurposed.
“It’s tough to tell at this point in time,” he said Thursday. “There are still some possibilities depending on how things work out with the Bay and who steps into some of those assets. We still don’t know the final pieces of that story.”
Meanwhile, across the street in the Rideau Centre, another huge swath of retail real estate – the two-storey, 157,000-square-foot space formerly occupied by Nordstrom – still sits empty two years after the Seattle-based department store chain pulled out of the Ottawa market.
Almeida said that property too will likely end up being leased to multiple users.
“I don’t think we’re going to see somebody come in and take the entire space,” he said. “Tenants are looking for smaller, more manageable spaces. It requires the landlord to be part of the solution and be able to rework that space to meet today’s needs.”
