Wave of Hudson's Bay temporary store closures hints at signs of stress: retail experts

financialpost.com:

Hudson’s Bay Co. made headlines last week after announcing it hoped to create a powerhouse in the world of luxury goods with the acquisition of Neiman Marcus Group LLC, but for some Canadian shoppers at its iconic Bay chain, it’s the basics that remain a bigger concern.

A number of Bay stores across Canada were temporarily closed this week for repairs in their heating, ventilation and air-conditioning systems, according to various media reports. For example, stores were closed in Vancouver, West Vancouver, Nanaimo, B.C., Coquitlam, B.C., and Victoria on Tuesday, according to the Vancouver Sun. Stores were also reported to have closed in Winnipeg and Windsor, Ont.

In recent months, shoppers have taken to social media to point out issues with maintenance at numerous Bay stores across the country, including repeated escalator outages and problems with air conditioning. The company declined to comment on the posts.

But some retail analysts view this week’s temporary closures as signs of stress, suggesting a lack of general upkeep due to the financial headwinds facing the sector.

“It is definitely not normal,” Liza Amlani, principal and founder of the Retail Strategy Group, said. “They thought (temporarily) closing the stores would be more cost-effective than bringing someone in to fix the problems and making some sales. That tells me that certain stores at the Bay are struggling.”

HBC last week said the completion of its US$2.65-billion deal to buy Neiman will create a separate entity for its Canadian business, which includes the Bay stores and a real estate portfolio estimated to be worth $2 billion.

The Canadian business will be “recapitalized as a standalone entity with significantly reduced leverage and enhanced