Shindico confident new tenant will take up Polo Park Target building
Just months after opening its doors, Polo Park’s 107,000-square-foot Target store and 132 other outlets across Canada are set to go the way of Zellers, wiped from the Canadian landscape.
Target bought the leaseholds for 189 Zellers stores from the Hudson’s Bay Company in 2011. It opened its first Canadian Target outlet in 2013 in Ontario.
But on Thursday morning, the U.S. retail giant announced that nearly $1 billion in losses in its first year paired with huge projected losses over the next six years fueled its decision to pull out of the Canadian market.
By the time Target came around, all the retailers in Canada had kind of pulled up their socks and had to complete with Walmart, so the competition was a lot tougher.”- Barry Prentice, professor of supply chain management at the University of Manitoba
Shindico's development manager Bob Downs admitted Target closing could mean delays in expanding its plaza at Polo Park Shopping Mall.
“When you don't know what's going to be in the building, it will affect how quickly you can assign people to go on the site,” said Downs.
The Polo Park location was meant to be the anchor-store of the area’s new outlet centre. Downs said he’s confident new tenants will be found.
“It's the best retail node in the city,” said Downs. “We want to make it even better and if Target isn't there then someone else will be.”
Meanwhile, Shindico is developing another retail area around Assiniboia Downs.
Target joins list of retailers to leave Canada
Women’s clothing stores Smart Set and Jacob are also leaving in huge numbers. Smart Set announced in November it will close 107 locations across Canada, and Jacob announced in October it will close its 92 stores across the country.
Back in January of 2014, Sears announced it would lay off 2,000 employees.
Barry Prentice, professor of supply chain management at the University of Manitoba, said in light of Target’s decision, one of the significant challenges now facing the market will be to find commercial tenants that can take up the large Target-built buildings.
“It's very hard to find anchor-tenants and it's going to be hard to fill that gap,” said Prentice.
Prentice said the Canadian dollar and a saturated market was Target's downfall.
“By the time Target came around, all the retailers in Canada had kind of pulled up their socks and had to complete with Walmart, so the competition was a lot tougher.”
Prentice said other large American retailers considering a jump to Canada should take heed of the example set by Target. He said success south of the border doesn’t necessarily guarantee success in Canada.