Canada’s Oldest Company Collapses: The Shocking End of Hudson’s Bay’s 355-Year Legacy!
The Hudson’s Bay Company (HBC), a cornerstone of Canadian history since its founding in 1670, has shuttered its doors, marking the end of a 355-year legacy as North America’s oldest corporation. Once a fur-trading giant that controlled roughly a third of modern-day Canada, HBC evolved into a retail powerhouse, anchoring malls and shaping Canadian consumer culture. However, its recent bankruptcy and the closure of all 80 department stores in 2025 have left a void in the retail landscape, sparked economic concerns, and reignited debates about its colonial legacy.
The Rise and Evolution of Hudson’s Bay
Founded under a royal charter from England’s King Charles II, HBC began as a fur-trading enterprise, leveraging vast territorial control over Rupert’s Land without Indigenous consent. By the 19th century, as the fur trade waned, HBC diversified into retail, opening its first department store in Winnipeg in 1881. Over the decades, it expanded nationwide, acquiring chains like Morgan’s, Freimans, Simpsons, and Woodward’s, and rebranded as “The Bay” in 1965. By 2021, HBC operated 86 stores across seven provinces, offering everything from fashion to furniture, with iconic “point blankets” symbolizing its heritage. These blankets, originally traded with Indigenous trappers, became a hallmark of Canadian identity, adorning items from canoes to kitchenware.
The Path to Bankruptcy
HBC’s demise was not sudden but a culmination of financial, strategic, and market challenges. By March 2025, the company filed for creditor protection under the Companies’ Creditors Arrangement Act (CCAA), citing $950 million in debt, including $724.4 million in mortgages, and only $3 million in cash. Court documents revealed struggles with unpaid rent, vendor payments, and payroll obligations. The company’s financial woes were exacerbated by:
Economic Pressures: Inflation, rising interest rates, and a weakening Canadian dollar curbed consumer spending on non-essential goods. In 2024, Canadian retail sales growth slowed to 1.2%, with department stores seeing a 3.5% decline in revenue compared to 2023, according to Statistics Canada.
Post-Pandemic Shifts: The shift to remote work reduced foot traffic in urban stores. For instance, downtown Ottawa’s HBC store saw a 40% drop in visitors from 2019 to 2024, per Retail Insider. The rise of e-commerce, with 27% of Canadian retail sales occurring online in 2024, further eroded in-store sales.
Operational Neglect: Underinvestment led to dilapidated stores, with broken escalators and elevators becoming common complaints. A 2024 Retail Council of Canada survey found 68% of shoppers rated HBC’s store conditions as “poor” or “very poor.”
Ownership Missteps: Acquired by NRDC Equity Partners, led by Richard Baker, in 2008, HBC was initially revitalized under CEO Bonnie Brooks. However, Baker’s focus shifted to real estate and acquisitions like Saks Fifth Avenue and Neiman Marcus, leaving HBC’s retail arm underfunded. By 2020, HBC was taken private, and in 2024, it was spun off from Saks Global, saddled with debt.
By June 1, 2025, all 80 HBC stores and 16 Saks-related locations closed, with liquidation sales offering discounts up to 90%. The company’s intellectual property, including its iconic stripes and coat of arms, was sold to Canadian Tire for $30 million, with no plans to revive the stores.
Economic Fallout: Layoffs and Market Impact
The closure has profound economic implications. HBC’s bankruptcy led to 8,347 layoffs, representing 89% of its workforce, by June 1, 2025. This followed earlier cuts, including 41 employees in January 2024 and 100 in April 2024. Non-unionized workers, classified as unsecured creditors, are unlikely to receive full severance, with estimates suggesting only 10-20% recovery through government programs, per Samfiru Tumarkin LLP. The layoffs contribute to Canada’s rising unemployment, which hit 6.9% in April 2025, the highest since November 2024, per Reuters.
The apparel market, however, is expected to absorb the blow. HBC held a mere 2.2% share of Canada’s $45 billion apparel market in 2024, down from 2.4% in 2023, according to Trendex North America. Competitors like Walmart, Simons, and direct-to-consumer brands are poised to capture HBC’s customers. Retail analyst Randy Harris noted, “HBC’s closure won’t disrupt apparel sales significantly, as its market presence had already dwindled.” However, the loss of HBC as a platform for emerging brands may hinder new market entrants, with 15% fewer international labels expected to launch in Canada in 2026, per Trendex.
Real Estate Implications
HBC’s closure leaves a significant real estate footprint. The company operated 80 stores, many in prime urban locations, with an estimated 12 million square feet of retail space. Ruby Liu Commercial Investment Corp. acquired 28 store leases in British Columbia, Alberta, and Ontario, planning a new multicultural department store chain, pending landlord and court approval. This venture, led by Weihong Liu, aims to fill the gap but faces challenges in a market favoring smaller, experiential retail. For instance, French retailer Printemps opened a 55,000-square-foot store in New York, a stark contrast to HBC’s sprawling 150,000-600,000-square-foot locations.
The remaining leases are attracting bids, with 12 offers for 39 stores reported in May 2025. RioCan Real Estate Investment Trust, a joint venture partner, faces uncertainty over 12 HBC-leased properties. The closure could depress commercial real estate values, with CBRE Group estimating a 5-7% decline in mall property valuations in 2025 due to anchor tenant losses. Conversely, it opens opportunities for repurposing spaces into mixed-use developments, such as residential or entertainment hubs, as seen with HBC’s former Winnipeg flagship, donated to First Nations communities in 2022.
Indigenous Legacy: A Complicated History
HBC’s history is inseparable from Canada’s colonial past. Granted a third of Canada’s territory in 1670, HBC exploited Indigenous lands and labor, particularly through the fur trade. Indigenous trappers, vital to HBC’s early success, were often paid with goods like point blankets rather than fair wages, fostering dependency. The 1869 sale of Rupert’s Land to Canada for $1.5 million, without Indigenous consultation, entrenched colonial structures. Critics argue HBC’s wealth was built on systemic exploitation, a sentiment echoed by Indigenous scholars like Niigaan Sinclair, who noted in a 2025 CBC interview, “HBC’s legacy is one of extraction, not partnership.”
Recent gestures, like donating the Winnipeg store to First Nations, have been criticized as symbolic rather than substantive. A 2024 Assembly of First Nations report estimated that HBC’s historical land holdings, adjusted for inflation, would be worth $20 billion today, yet Indigenous communities received minimal compensation. The closure has sparked calls for reparative actions, with 62% of Canadians in a 2025 Angus Reid poll supporting some form of restitution to Indigenous groups tied to HBC’s legacy.
Cultural and Consumer Impact
HBC’s closure evokes nostalgia among Canadians, with its striped blankets and department stores symbolizing national identity. Shoppers like Bryan Higgins, quoted in the New York Times, likened shopping at HBC to visiting Tim Hortons, a cultural ritual. However, younger generations, with 70% of 18-34-year-olds preferring online shopping in a 2024 Statista survey, drifted away from HBC’s outdated model. Retail experts like David Ian Gray argue that HBC failed to adapt, sticking to a “tired” department store format while competitors like Simons embraced smaller, curated stores.
The liquidation sales, with discounts up to 90%, drew bargain hunters but highlighted HBC’s decline. Stores were stripped bare, with fixtures like mannequins and hangers sold off. The emotional toll was evident, with long-time employees facing job loss without severance. A Retail Insider commenter, a 10-year HBC veteran, lamented, “This is our Canadian heritage, and it should have been protected better.”
Could HBC have survived? Kersi Antia’s 2025 study in the Journal of Marketing suggests that stronger supplier relationships could have boosted survival odds by 39% through flexible payment terms or collaborative restructuring. Canadian Tire’s acquisition of HBC’s brand offers potential for an online revival, though no concrete plans exist. Meanwhile, Ruby Liu’s proposed chain could reimagine the department store with a modern, multicultural focus, but success hinges on adapting to e-commerce and experiential retail trends.
HBC’s fall underscores broader retail lessons: adapt or perish. Canadian Tire, cited by Retail Insider as a model, reinvents itself every few years, maintaining relevance. HBC’s failure to modernize stores, invest in digital infrastructure, or redefine its brand left it vulnerable. The closure joins a litany of failed Canadian retailers—Eaton’s, Sears, Target—highlighting the need for agility in a digital age.
The Hudson’s Bay Company’s closure marks the end of a 355-year saga, from fur trader to retail icon. Its bankruptcy, driven by debt, declining sales, and strategic missteps, leaves 8,347 workers jobless and a $950 million debt unresolved. The real estate fallout opens opportunities for innovation, while the Indigenous legacy demands reflection and potential restitution. As Canadians mourn a cultural institution, HBC’s story serves as a cautionary tale for retailers worldwide: evolve with the times or face obsolescence.
