Hudson’s Bay receives approval for sale of three leases to B.C. mall owner Ruby Liu

B.C. billionaire Ruby Liu. Photo by Ruby Liu/Handout/The Canadian Press

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TORONTO — The B.C. billionaire looking to turn Hudson’s Bay Co.’s old digs into her own retail empire left court Monday with the beginnings of her venture in hand — and a looming fight that could curtail her full ambitions.

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Ontario Superior Court judge Peter Osborne granted Ruby Liu permission to take over leases for three Hudson’s Bay properties in malls she owns. She will pay $6 million for the set of leases at Tsawwassen Mills, Mayfair Shopping Centre and Woodgrove Centre.

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“She is contributing millions of dollars of real value to the Companies’ Creditors Arrangement Act process,“ said David Ward, a lawyer representing Liu. ”She is betting on herself.”

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As he spoke, Liu and an entourage of her staff looked on from the gallery. Earlier that morning, she arrived clad in a stylish black blazer and high heel boots, carrying a Louis Vuitton purse. She posed for photos beside the court coat of arms and told media she was planning to move to Toronto.

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The sale of some Hudson’s Bay leases comes after the storied department store filed for creditor protection in March, a few months shy of its 355th birthday. In the months after, it looked for a buyer who could keep some semblance of the retailer alive, but the search was fruitless.

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By June 1, all 80 Bays and 16 stores run under the Saks brands closed, putting their leases up for grabs. A dozen bidders made offers on a collective 39 properties.

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Liu, who made her money in China’s real estate market, wound up winning the leases at three malls she runs because her bid had a superior value and terms, the Bay has said.

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Liu wants to use the properties to open a chain of modernized department stores she will name after herself. She has told The Canadian Press they will sell makeup, jewelry and apparel but will also have play spaces for children, dining areas and entertainment space.

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She expects to spend more than $30 million to revamp the spaces at her malls to accommodate her Ruby Liu stores.

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And that’s just the beginning. The Bay has reached a deal with her for 25 more leases belonging to it and its sister Saks companies.

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Anyone who made an offer for leases had to make a deposit of 10 per cent of their estimated purchase price. Court documents show Liu made a deposit of $9.4 million, in addition to $6 million for the three approved leases, which would equate to a purchase price of $100 million for 28 leases.

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“That is not really a business plan, that is a full-circle investment,” Liu’s lawyer Ward said in recommending the court accept the three-lease deal.

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The remaining 25 leases are in Alberta, B.C. and Ontario properties she doesn’t own. The Bay has yet to seek court approval for the arrangement, but landlords for the spaces are overwhelmingly opposed to her moving in.