'We've seen this coming for a long time': Hudson’s Bay is closing the iconic Downtown Winnipeg store

The end of an era for Downtown Bay store After nearly 100 years in business, The Bay Downtown is closing its door. CTV's Touria Izri reports.

WINNIPEG — The Hudson’s Bay Company will be closing its 'landmark' Downtown Winnipeg location in February 2021.

According to a statement from a spokesperson for HBC, this decision comes amid shifting consumer behaviours and changes to how and where people shop.

The statement noted that Winnipeg is still an important market for the Hudson’s Bay, and Winnipeg customers can still shop at stores at Polo Park and St. Vital, as well as online.

The spokesperson added the company is working with the city and partners to find a new use for the 94-year-old “landmark” building.

All eligible store employees will receive employment separation packages, and the store will explore transfer opportunities where possible.

The Hudson’s Bay in Downtown Winnipeg opened in 1926. You can watch some archival footage from the Archives of Manitoba, showing the opening day.

'WE'VE SEEN THIS COMING FOR A LONG TIME'

The closure of the store may not come as a surprise to many in the city. In recent years, the more than 600,000 square foot building has faced some financial difficulties.

The basement of the building was converted into a Zellers store in 2010. That lasted three years until the store closed in March 2013.

The iconic Paddlewheel Restaurant on the sixth floor of the building closed down in January 2013.

The Paddlewheel Restaurant on the sixth floor of the Hudson’s Bay Downtown Winnipeg department store after in 1959. (Source: Hudson's Bay Company Archives/ City of Winnipeg historical buildings committee report)

Many departments in the store had been closed or consolidated, with three floors in the building being permanently closed.

"I think we've seen this coming for a long time – it started when they started closing down one floor after another so that there was fewer and fewer places to shop," said Robert Warren, a marketing and retail expert, and instructor of marketing at the University of North Dakota.

"I think what really pushed them over the top was this – the recent pandemic and all the issues associated with it have just really pushed all the retail problems much further ahead than they were before."

READ MORE: HBC, Canadian Tire could be in trouble next during pandemic: retail expert

A recent appraisal of the iconic building from a real-estate evaluator found the building to be worth $0, and would actually cost millions to sell the building, according to a November 2019 appraisal report from Cushman & Wakefield ULC.

"What it boils down to is the cost to renovate that building far outstrips any value it has," Warren said. "You would essentially be better off to just level the place and start all over again."

WHAT TO DO WITH AN ICONIC BUILDING THAT NOBODY CAN USE?

But demolition is not on the table for the iconic building. The building received a historical designation from Winnipeg city council in 2019.

That means the building is protected, and anyone who wants to move into it has to follow certain guidelines and standards to conserve the aesthetic, historic, and cultural significance of these structures.

The iconic Hudson’s Bay Downtown Winnipeg department store under construction in May of 1926. (Source: Manitoba Archives/ City of Winnipeg historical buildings committee report)

"Having this heritage component is going to make it tougher to find somebody who wants that space and can figure out how to use it effectively, or can at least keep the exterior façade and build up behind it," Warren said.

He said, despite the building's beautiful architecture, it has had a difficult time attracting organizations to fill the space. He said The University of Winnipeg had looked at converting the space into classrooms, and some developers have looked at using the space for condos and apartments.

A look inside the Hudson’s Bay Downtown Winnipeg department store after its opening in November 1926. (Source: Hudson's Bay Company Archives/ City of Winnipeg historical buildings committee report)

But the work and dollars required to restore the building tanked the deals.

Warren said he hopes a decision is reached soon as to what the future will hold for the iconic building.

"We need to come to an agreement on what can be done with that building, or who can move into it as is fairly quickly, or else literally the gateway to Downtown from the west is going to be a bit of an eyesore."

-with files from CTV's Jon Hendricks