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HBC to expand Zellers brand into 20 new locations

The first will be at HBC's flagship store on Queen Street in Toronto

Hudson’s Bay Company (HBC) has announced plans to expand its Zellers brand across Canada – initially through a series of "pop-up" boutiques inside more of its existing Hudson's Bay stores.

The first pop-up will launch at Hudson's Bay's flagship Queen Street store in Toronto in June, with up to an additional 20 pop-ups expected to open through the summer. Zellers plans to open larger stores in the future at some or all of these locations.

There is no indication on a final number of stores, nor any information on the size of the pop-ups or the potential larger stores.

"We have always said that we will listen to Canadians and they will tell us where to grow," Sophia Hwang-Judiesch, president of Hudson’s Bay, said in Monday's announcement.

"With these pop-ups, our expansion strategy will be fuelled by the interest and feedback from our customers across the country."

The Zellers chain was founded in London, Ont., in 1931. It was purchased by HBC in 1978 and closed in 2013.

At its peak in the late 1990s, Zellers had 350 stores across Canada.

HBC sold the leases for many Zellers locations to U.S.-based Target Corp. in early 2011 for Target to launch its own unsuccessful Canadian venture.

HBC is North America’s oldest company, founded in 1670, with headquarters in Toronto and New York.

It owns or controls – either entirely or with joint venture partners – approximately 42 million square feet of gross leasable area.

HBC also announced it raised $240 million of additional liquidity to further invest in and grow its operating businesses.

HBC’s Zellers rollout

"As we diversify our consumer offerings, we are strongly positioned to expand on the retail experience customers have come to expect from Hudson's Bay, Saks Fifth Avenue, Saks Off Fifth and now Zellers," Richard Baker, HBC’s governor, executive chairman and CEO, said in the release.

"With this incremental liquidity, we will strengthen our businesses and build upon the great foundation we have established."

In March, HBC relaunched Zellers, beginning with 8,000- to 10,000-square-foot locations inside 25 Hudson's Bay stores across Canada.

The locations are leased from several major commercial landlords including Cadillac Fairview, Ivanhoe Cambridge, Oxford Properties, Morguard and Primaris REIT.

The relaunch also included a e-commerce platform, which went live on March 23.

Stores included in the initial rollout are CF Rideau Centre in Ottawa; Scarborough Town Centre in Scarborough; The Pen Centre in St. Catharines; Sunridge Mall in Calgary; Kingsway Mall in Edmonton; CF Pacific Centre in Vancouver; and Guildford Town Centre in Surrey.

As was noted in March, the physical locations provide support for the e-commerce platform.

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