Walmart to replace no-showing Target?

Shape Properties has done an amazing job of keeping details of future Brentwood retail and entertainment tenants from not only the public, but from its current Brentwood Mall tenants as well.  Despite such well-kept secrecy, rumours have begun circulating that Walmart may become a major anchor tenant in the new Brentwood Mall instead of the recently-failed Target which had plans to take up shop in the new development.  Such an entry by Walmart would most likely involve the relocation of the Grandview Hwy location to Brentwood.

No Target for Brentwood...or Canada for that matter

As locals have been wondering lately about what new retailers and restaurants might be coming to the Brentwood Mall redevelopment, news have come out today to settle once and for all which store will definitely not be coming to the Amazing Brentwood.

(CBC News Story)

Target to close all 133 Canadian stores, gets CAA protection

Retail chain opened in Canada in spring 2013 but has decided to close shop

By Pete Evans, CBC News Posted: Jan 15, 2015 8:37 AM ET Last Updated: Jan 15, 2015 11:51 AM ET

Target says it plans to discontinue all operations in Canada and has been granted protection from creditors, less than two years after opening to much fanfare.

In a release early Thursday, the U.S. retail chain said it will close all its locations in Canada. There are 133 stores across the country with about 17,600 employees.

The company launched in Canada in March of 2013, not quite two years ago.

But after high expectations, the chain failed to deliver right out of the gate as customers faced higher-than-expected prices, and empty shelves as the retailer had problems with its distribution chain.

Target lost almost $1 billion in its first year in Canada, and while the losses have shrank since then, the chain is still losing money daily.

Executives repeatedly promised they would get it right and reaffirmed their commitment to Canada as recently as July, but ultimately decided to pull the plug.

"After a thorough review of our Canadian performance and careful consideration of the implications of all options, we were unable to find a realistic scenario that would get Target Canada to profitability until at least 2021," the U.S. parent company's CEO Brian Cornell said in a release Thursday, explaining the justification for the shutdown.

Target filed an application in a Toronto courtroom for protection under the Companies’ Creditors Arrangement Act early Thursday morning. That request was granted.

The federal law allows companies that can't pay their debts the ability to restructure themselves. Without it, the companies and individuals that an insolvent company owes money to can technically start seizing assets. But because Target has applied under CCAA, that won't happen here yet.

Aaron Alt, most recently Target's senior vice-president and treasurer, has been named CEO of Target Canada to execute the winddown process under the court's supervision.

Target's shareholders welcomed the news, sending shares in the company up almost three per cent on the NYSE on Thursday. Closing up shop in Canada means the company has more money to focus its efforts on shoring up its also-struggling U.S. operations.

Target launched to much fanfare in March 2013, but the chain was plagued by problems. (Andrew Vaughan/Canadian Press)

And at least one analyst also hinted that it was a good idea to end the failed experiment in Canada.

"Target’s decision to exit Canada after less than two years of store operations is an admission that it has failed in its attempt to enter a new market," Moody's analyst Charlie O'Shea said. "With over $1.5 billion in … losses, it is clear that the early flaws in Target’s strategy to simultaneously open stores while building out or developing its supply chain became insurmountable."

Severance will be paid

Target has hired international consultancy Alvarez & Marsal to oversee the liquidation and wind-down process.

Most of Target's stores are in locations that were taken over from existing Zellers leases, but the company does own some real estate in Canada. 

Financial advisory firm Lazard Ltd. will advise the company with regards to possibly selling its real-estate assets. 

A large number of Target's locations are owned by Toronto-based RioCan Investment Trust. Units of that REIT shed about one per cent on the TSX on Thursday when the Target news came out.

The company is seeking the court's permission to set up a $70-million fund to ensure all employees affected by the move get at least 16 weeks in severance pay. The stores will remain open while the company completes the liquidation process.

"Your efforts have been extraordinary, and absolutely nothing about our decision to exit diminishes your hard work and dedication," Cornell told employees in a letter on Thursday, a copy of which has been obtained by CBC News.

Target said the decision to close shop in Canada will cost between $500 million and $600 million in cash from the U.S. parent's bottom line, but results in a writedown of about $5.4 billion from an accounting perspective in the upcoming fourth-quarter earnings.

Target is the latest retailer to go under in what's becoming an increasingly tough retail environment in Canada.

Fashion shops Mexx, Smart Set and Jacob have all announced plans to close down in recent months. Montreal-based Le Chateau hasn't officially closed, but the clothing chain has been in a tough spot of late.

Zeller's union fighting to the end

The unionized staff at Zellers in Brentwood Mall, the only unionized Zellers in BC, has lost its bid to be recognized by the incoming Target Corp.

Meanwhile, with the upcoming closure of Zellers underway, unconfirmed rumours of Sport Chek's entry into the space being vacated by Zellers have begun to swirl.  As we already know, the Sport Mart chain that was bought out by the parent company of Sport Chek will be shutting its doors everywhere, including the Brentwood location this March.  Sport Chek tends to have a larger retail space format and, according to the rumours,  Sport Chek would occupy one of the two floors of the Zellers space with another large retailer occupying the remaining floor.

This would confirm that Target will eventually make its entry in a new section of the future Brentwood Mall Redevelopment, most likely near the Entertainment Plaza and the current Zellers location.

Burnaby Now article on the union case below:

Target's 'Project Bacon' is a go at Brentwood

BY JANAYA FULLER-EVANS, BURNABY NOW JANUARY 9, 2013

Zellers at Brentwood Centre is set to close as of March 14.

Approximately 150 store employees, members of the United Food and Commercial Workers' Union, were fighting to have the new owner, Target Canada, declared a successor to Zellers so that the U.S.-based retailer would be forced to honour the current collective agreement.

But in November, the Labour Relations Board of B.C. ruled against the union's application, stating in its ruling that Target and Zellers are two different types of department store retailers and that the U.S. company had purchased Zellers locations primarily for real estate.

"We're very upset," said Kim Novak, a communications representative for the union. "We're very sorry to see very hardworking people lose their jobs, essentially, when Target comes in in March - the store will be closing in March."

The union has started a web-based campaign at Targetfairness.ca, to garner support for Zellers employees and encourage Target to hire them at the new locations.

Target purchased 189 leases from Zellers in 2011 as part of an expansion venture code-named "Project Bacon," according to the ruling, as well as Zellers' pharmacy files, which were sold off, and the Cherokee brand name for its U.S. market.

In regards to the Brentwood location, the ruling stated there would be a hiatus, between six months and three years, before Target opens its store at Brentwood.

"Though the employees may perform similar jobs in both stores and the transaction agreement confirmed the transfer of leases, pharmacy records and the brand waiver (for Zellers' Cherokee brand), I find those are not sufficient for me to conclude there is a discernible continuity of Zellers' business," wrote Ritu Mahil, the board's vice-chair.

"The Target brand is unique and distinctive in the retail industry," Mahil stated in the ruling. "Target presented evidence of high awareness amongst Canadian consumers for the Target brand. Dr. (Stephen) Hoch (an expert witness for Target) gave evidence that there was no likelihood of consumer confusion between Zellers and Target. Dr. Hoch further stated that it is in Target's best interests to distance itself as much as possible from Zellers."

Lisa Gibson, the communications contact for Target Canada, was not available by phone Monday before press time.

The company announced in a press release last summer that 125 Zellers locations are being turned into Target locations this year, with more locations planned for early 2014 and beyond.

Each location will close for six to nine months for renovations before reopening as a Target store, the release added, and the company is spending more than $10 million to remodel the locations.

Target plans to turn the Zellers at Metropolis at Metrotown into a Target store, as well, and has been applying for city permits to change the signage there, but neither Burnaby location is on the list of stores that Target plans to open this year.

jfuller-evans@burnabynow.com

For more business news in Burnaby, see the NOW online at www.burnabynow.com.

© Copyright (c) Burnaby Now

Read 

2015 Target for Brentwood

It has been confirmed that Target will indeed be coming to Brentwood Mall in 2015.  With Zellers slated for closure by 2013 and the Brentwood Mall Redevelopment expected to begin the same year, we can expect either a demolition of the existing building that houses Zellers or an expansion to accommodate a typical Target store.

The following story in The Star indicates that the current unionized staff at Brentwood want to be recognized as a union by the incoming Target Corp.  Target has stated that it will not recognize the union when it comes in.

Here are some improvements to the shopping experience that Target will bring that Zellers has consistently failed at:

1. Price tags on items.
2. Electronic price checkers that actually work.
3. Organized aisles with goods arranged under the correct description and price.  Goods blocking aisles (City safety bylaw infractions) or just strewn about on shelves have been consistent features of the Brentwood Zellers.
4. Better management team that can identify the above 3 issues as areas for improvement.

Target doesn’t want anything to do with ‘depressed’ Zellers

Published on Friday August 17, 2012

Francine Kopun
Business Reporter 

Target wants nothing to do with the old Zellers stores or image – it doesn’t even want its customer lists, according to documents filed with the B.C. Labour Relations Board.

The documents were filed in defence of a claim by the United Food and Commercial Workers Union, which is trying to have Target declared a successor employer at the Brentwood Mall location in Burnaby, set to open as a brand new 160,000 square foot marquis Target store in 2015.

If the claim is successful, it would put Target in the position of having to employ the current Zellers workers at the Brentwood location, who are unionized.

Hearings are scheduled for August 27-31.

Target’s defence against the UFCW application offers a glimpse behind the brand.

Target’s preference in expanding into Canada was to adopt a “Greenfield” approach – completely new constructions. But Target felt that the comparatively intensive regulation of land use in Canada could delay the process.

Purchasing the Zellers leases from HBC for $1.825-billion allowed the U.S. firm to take on leases that in many cases had terms which were well below market value and represented an opportunity for Target to save millions of dollars in rent.

Zellers had approached Target in the past about making a deal.

“Based on overtures from Zellers in the past, Target was aware that Zellers was prepared to consider a transaction that would provide Target with the right to acquire leasehold interests in a portion of Zellers’ sites,” according to the Target statement.

Target plans to completely remodel each former Zellers location, spending $10-$11-million per site.

Zellers and HBC share a client list through their joint customer loyalty program, HBC Rewards, but Target is not acquiring the list.

“When compared to Target’s guests in the U.S., Zellers attracts a different customer base, older and more likely to be ‘empty nesters.’ Zellers customers are also likely to spend significantly less per visit than a Target guest.”

HBC has retained the lists.

Target Canada spokesperson Lisa Gibson says Zellers customers should not infer from this that they are not welcome at Target.

"We welcome any and all guests to shop our stores. We were simply saying in the documents filed that our typical guest demographic is quite different than Zellers typical guest demographic."

Zellers' union in Target's crosshairs

The following Vancouver Sun story highlights how an anti-union culture  is being brought into Canada's retail landscape by big US retailers such as Target Corp.  Target recently purchased all Zellers locations and has stated its intention to break up the union representing workers at Zellers Brentwood Mall.

Vancouver Sun story below

Burnaby's Zellers staff want union agreement honoured

Dispute before Labour Relations Board hinges on whether Target is a ‘successor’ to Zellers

BY DARAH HANSEN, VANCOUVER SUN DECEMBER 1, 2011 7:07 PM

Target is taking over Zellers stores in Canada and that’s led to a dispute between the U.S. company and the union representing 120 employees at the Brentwood Mall Zellers in Burnaby.

Photograph by: JESSICA RINALDI, Reuters

Unionized staff at a Zellers outlet in Burnaby are hoping to force Target Corp. to honour their collective agreement when the U.S.-based discount retailer takes over the store lease next year.

The union representing 120 employees at the Brentwood Mall Zellers said workers have been told they will be laid off following the store’s conversion to Target, and will be rehired without union status.

Andy Neufeld, spokesman for the United Food and Commercial Workers’ Union, Local 1518, said Target has a reputation for being “aggressively anti-union” in the U.S.

Earlier in November, the UFCW filed an application with the B.C. Labour Relations Board seeking to have Target declared the “successor employer” to Zellers. If successful, the successorship application would ensure the existing collective agreement with Zellers will remain in place despite a change in ownership.

“We think there is enough indication there that [Target] intends to operate the business in a way that is comparable to Zellers; therefore, we think there is pretty solid grounds to pursue a successorship application,” Neufeld said.

Target has yet to officially respond to the application. However, company spokeswoman Lisa Gibson said in an email that Target is aware of the filing and will dispute the union’s position.

“We believe the transaction between Zellers and Target is a real estate transaction and not the acquisition of a business, technology or employees. As such, we do not believe Target is a successor employer under applicable law and do not believe that there was reasonable cause to file a successorship application and will contest the filing,” Gibson wrote to The Sun.

The Brentwood Mall Zellers is one of 125 to 135 Zellers locations across the country — and the only unionized location in B.C. — slated to become Target as part of a $1.825-billion lease-takeover deal reached earlier this year between the companies.

Target has said it will spend up to $11 million to convert the Zellers stores to fit its low-cost retail model, with most opening in 2013 after a six- to nine-month renovation.

At the heart of the labour dispute is whether Target intends to take over Zellers’ business, or the location.

Larry Page, a labour relations lawyer based in Vancouver who is not involved in the case, said a decision by the LRB will likely be based on the fine print written into the lease-transfer agreement between the two employers, including the details of the transaction between Zellers and Target and the nature of Zellers’ business.

“The focus here is the business,” Page said. “If [the LRB] can track the business from the seller to the buyer, then certification and collective agreement go with the business. If the business has effectively been terminated by the closure of the Zellers store, and Target has not taken on that business, then there wouldn’t be a successorship.”

Page said disputes over successorship rights are common among businesses, and questioned the UFCW’s anti-union accusation.

“If Target has structured this deal so that it is not taking over the business of Zellers, there is no reason for it to automatically assume certification and collective agreement.”

Gibson said Target’s emphasis is on “creating an environment of mutual trust between Target and our core team members, an environment that promotes listening, responding to the concerns of team members and always giving honest feedback. Target believes in solving issues and concerns by working together with the help and input of all team members.”

Target announced in September its plans to open outlets in Kamloops, Kelowna, Penticton, Prince Rupert, Salmon Arm, Dawson Creek and Victoria, as well as several locations across Metro Vancouver.

dahansen@vancouversun.com

Twitter:@darahhansen

© Copyright (c) The Vancouver Sun

http://www.vancouversun.com/business/Burnaby+Zellers+staff+want+union+agreement+honoured/5798803/story.html#ixzz1fM77kzzM

More articles on this subject:

labour-reporter.com

Nov 29, 2011

Union says Zellers’ locals should remain after Target take-over

B.C. union files application with labour board to declare Target ‘successor employer

PAID ADVERTISEMENT

The union representing workers at a Zellers in Burnaby, B.C. has filed an application with the B.C. Labour Relations Board, asking for Target to be declared as the “successor employer” when the company opens operations in Canada.

American-based Target plans to convert 135 Canadian Zellers stores by 2013. Their current plan is to let go of all of the Zellers staff and hire its own employees.

Currently, 15 Zellers stores are unionized.

By asking the B.C. Labour Relations Board to declare Target as the “successor employer,” the United Food and Commercial Workers (UFCW) union hopes the soon-to-be Target store will continue to be unionized and keep the workers employed. Canadian labour laws require successor companies to hold on to unions if the company is opening a similar business in the same area.

“The reason we filed this application is to ensure Target honours its legal obligation under B.C. labour law,” says UFCW Local 1518 president Ivan Limpright. “After Target bought Zellers earlier this year, we made a point of reassuring our Zellers members that their long-term job security is a top priority for the union.”

Limpright says UFCW 1518 intends to resume negotiations for a renewal collective agreement shortly. The union expects contract talks will continue during the Labour Board hearing.

Lisa Gibson, a spokeswoman for Target, told the Globe and Mail the acquisition of Zellers leases “is a real estate transaction and not the acquisition of a business, technology or employees. As such, we do not believe Target is a successor employer under applicable law and do not believe that there was reasonable cause to file a successorship application.”

Gibson indicated that Target will contest the application.

Canada is not new to American-owned operations opposing unionization when setting up shop north of the border. After a Jonquiere, Que. Wal-Mart voted to unionize in 2005, the company shut down the store.

Earlier this year, 150 Wal-Mart employees in Gatineau, Que. decertified their union after just one year with their first collective agreement. Employees at a St-Hyacinthe, Que. Wal-Mart decertified their union in March 2011 after the union spent years in court trying to achieve an agreement.


http://www.labour-reporter.com/articleview?articleid=11824&headline=union-says-zellers-locals-should-remain-after-target-take-over

Not clear if Zellers a Target

According to the following Vancouver Sun story, Target Corp has added 84 Canadian Zellers stores to the list of stores either slated to become a Target store or to be sold to another American retailer such as Walmart.  After not making the list earlier in the year, Zellers Brentwood has made the cut this time. However it is not yet clear in the story if it will become a Target store or its lease sold to a competitor.

With Brentwood Mall actively pursuing a massive redevelopment that will transform the mall itself along with its surrounding parking lots into a mixed-use core in the Brentwood neighbourhood, it wouldn't be a surprise if Shape Properties (mall owner) contacted Target Corp to entice it to add the Brentwood Zellers to its list of stores to expand into.  Brentwood Mall will require a commitment from a retail giant such as Target to anchor an expanded and improved Brentwood Mall.

Vancouver Sun Story:

Target finalizes Canadian expansion with 84 additional Zellers leases

SEPTEMBER 23, 2011

Target Corp. said Friday that it has selected its final leases of Zellers Inc. stores in Canada, laying the groundwork for the opening of 125 to 135 Target stores across the country by 2013.

The Minneapolis-based discount retailer said in January that would buy up to 220 leasehold interests of Zellers, a subsidiary of the Hudson’s Bay Co., for $1.825 billion.

On Friday, the final selection was announced, adding 84 more Zellers leases and bringing the total number of selected sites to 189. Those sites that aren’t converted into Target stores either have been or will be sold to other entities, which could include Wal-Mart Stores Inc.

The final list adds 11 locations to British Columbia, including Kamloops, Kelowna, Penticton, Prince Rupert, Salmon Arm, Dawson Creek and Victoria.

On the Lower Mainland, Target has zeroed in on the Brentwood Mall in Burnaby, Lynn Valley Centre in North Vancouver, Central City Mall in Surrey and Lansdowne Centre in Richmond.

Earlier, the company announced that it would take over store leases at 15 Zellers locations in B.C., from Vancouver’s Oakridge Centre, Coquitlam Centre and Metropolis at Metrotown in Burnaby to the Abbotsford Power Centre and Cottonwood Mall in Chilliwack.

The locations were selected after an analysis of trade areas based on demographics, competition and market potential, Target Canada president Tony Fisher said in an interview with The Sun in January.

In a media release issued Friday, Fisher called Target’s most recent announcement “another meaningful step toward our expansion in Canada.”

The company plans to spend up to $11 million to convert the Zellers stores into Targets. Most of them will open in 2013 after a six- to nine-month rehabilitation period.

Until the remodelling begins, the company said, they will be subleased to Zellers and continue to operate as such.

Each Target store would employ 150 to 200 people. Target has already begun the hiring process.

— Vancouver Sun with files from McClatchy Newspapers and ReutersList of Target’s second and final selection of 11 additional Zellers leases in British Columbia (includes potential Target stores and leases sold to other retailers):

4567 Lougheed Highway, Burnaby, BC — Brentwood Mall

11000 8th St., No. 1, Dawson Creek, BC — Dawson Mall

945 Columbia St. W., Kamloops, BC — Sahali Centre Mall

1876 Cooper Road, Kelowna, BC — Orchard Park Plaza

2210 Main St., Suite 100, Penticton, BC — Penticton Power Centre

500 Second Ave. W., Prince Rupert, BC — Rupert Square

8311 Landsdowne Road, Richmond, BC — Lansdowne Centre

1151 10th Ave. S.W., #400, Salmon Arm, BC — Piccadilly Place Mall

10151 King George Highway, Surrey, BC — Surrey Place/Central City

1175 Lynn Valley Road, North Vancouver, BC – Lynn Valley Centre

1610 Hillside Ave., Victoria, BC — Hillside Shopping Centre

© Copyright (c) The Vancouver Sun

Readmore:http://www.vancouversun.com/Target+finalizes+Canadian+expansion+with+additional+Zellers+leases/5450181/story.html#ixzz1Ypk4gMLg

What will become of Zellers?

Since Zellers Brentwood did not make the first cut in Target's plans to convert its newly acquired Zellers sites into a Target Stores, it is possible that another US retailer will purchase the lease for the store space.  Recently, it was announced by Walmart that it is working out an agreement to expand into some of Target's newly acquired space in Canada.  However, it is highly unlikely that Walmart will be coming to Brentwood as it already has a presence nearby on Grandview Hwy between Boundary Rd and Rupert St in Vancouver along with a store in Lougheed Mall.

Brentwood Zellers doesn't make the first cut

Target Corp, the US retailing giant that bought Zellers earlier this year, has announced the first wave of Zellers stores to be converted into Target stores. Although the Metrotown store was included among the 13 BC stores on the list, the Brentwood Town Centre store did not make the list.  Target has emphasized that this is merely the first phase and that more stores will be announced in later phases.

The decision to not include the Brentwood location in the first phase may be related to the fact that Brentwood Mall will be undergoing a major redevelopment in the future and Target will need to collaborate with the mall to transition the Zellers into a Target store at that time.

Target to replace Zellers in Brentwood?

An announcement was made today of the purchase by Target Corp of most Zellers stores in Canada.  Target has stated that it will replace 100-150 of the Zellers stores with brand new Target stores.  The remaining stores will be sold off to retailers like Walmart.

Since Walmart already has a new location on nearby Grandview Hwy in Vancouver and a location at Lougheed Mall, we can expect a Target store to replace Zellers at Brentwood Mall.  Target plans to spend over $1 billion on renovating existing Zellers stores across Canada and converting them into Target stores.

The Zellers sign may disappear by 2013

With Shape Properties currently planning a major redevelopment at Brentwood Mall, we can expect close collaboration between Target Corp and the mall owner during the next 2 years to remodel the mall.  Target plans to open its first stores in Canada by 2013.