Opinion: Vancouver's Nordstrom should turn into Ikea, Uniqlo, Eataly, and Simons (PHOTOS)

Mar 4 2023, 12:03 am

The shockwaves of Thursday’s sudden announcement of the complete closure of Nordstrom’s business operations in Canada continue to reverberate.

This drastic move by the luxury retail chain includes the permanent closure of its significantly sized flagship store location at CF Pacific Centre mall, which will almost certainly leave a void in the core of downtown Vancouver for an undetermined amount of time — until mall owner Cadillac Fairview is able to find new tenants.

The closure, set to be achieved by late June 2023, could also potentially exacerbate the issues of the struggling Granville Entertainment District immediately to the south.

“Cadillac Fairview is constantly assessing the ever-changing retail landscape and while it’s too early to speculate what we will do with these spaces in the future, our team is working diligently to manage this change and work towards an outcome that is in the best interests of our centres and our long term success,” reads Cadillac Fairview’s statement to Daily Hive Urbanized upon inquiry.

How long the space will remain empty is anyone’s guess, but the impact will be profound considering Nordstrom, since it opened at the mall in 2015, has become one of downtown Vancouver’s most unique and largest retail offerings.

As the only Nordstrom department store in Metro Vancouver, it has become a major retail destination in its short time at the location. In fact, the Vancouver location was amongst Nordstrom’s best-performing stores across the entire company, but it was dragged down by the overall poor performance of its Canadian division, which has not made a profit ever since it opened its first store in Calgary nearly a decade ago.

But Nordstrom’s loss will come as an opportunity for Hudson’s Bay Vancouver’s flagship store and CF Pacific Centre’s Holt Renfrew flagship store, which saw its local market share in luxury retail substantially eroded ever since Nordstrom first opened its doors. In the years since Holt Renfrew has made significant investments in expanding and improving its Vancouver location in order to better compete with Nordstrom.

nordstrom cf pacific centre vancouver

Nordstrom at CF Pacific Centre in downtown Vancouver. (Kenneth Chan/Daily Hive)

Nordstrom’s imminent exodus will be a major opportunity for major new retailers to establish a strong and high-profile presence in downtown Vancouver.

There has been a dearth of suitable, attractive, high-quality, centrally-located retail space in the core shopping areas of the Central Business District, where retailers overwhelmingly prefer to set up. And it has been known that, for many years, numerous major retailers have been looking to open in downtown, but have been unable to do so due to the lack of desirable space — forcing them to open up in the suburbs, at least initially.

“It’s early to say, but this may prove to be the opening needed for several new market entrants to land in Vancouver,” Martin Moriarty, the senior vice president of investment and leasing for Marcus & Millichap, told Daily Hive Urbanized when asked to react to Nordstrom’s sudden announcement.

“Nordstrom’s departure creates a unique opportunity for a large block of central space to be re-imagined and I know there will be a line-up of notable groups looking to take this chance.”

Vancouver City Councillor Peter Meiszner shared his disappointment over the withdrawal of Nordstrom and the resulting loss of jobs but also suggested this could be an opportunity for other major retailers.

“I’m confident that there will be many interested parties in this flagship retail space, and we could see some new, exciting retailers come to our downtown, including some Canadian brands,” Meiszner told Daily Hive Urbanized.

“Despite the closure, there’s a new buzz and optimism around downtown Vancouver and Granville Street. We are aggressively moving forward revitalization efforts of Granville Street, to transform it into a true 24/7 commerce and entertainment hub that’s vibrant at all hours of the day, where residents, visitors, and families can feel safe and be proud of.”

nordstrom vancouver pacific centre

2015 condition inside the Nordstrom at CF Pacific Centre. (Kenneth Chan/Daily Hive)

When Sears, the space’s previous tenant, closed in 2012, it left a void of 650,000 sq ft across the entire seven-storey building it occupied.

Cadillac Fairview’s complete post-Sears renovation of the building created a more efficient mix of uses, with Sears’ former menswear department in the basement level transformed into an indoor mall corridor expansion, the first three levels rebuilt into the 230,000 sq ft Nordstrom store, and the remaining upper levels converted into premium open office spaces for major businesses such as Microsoft and the global headquarters of Sony Pictures Imageworks.

In the current retail market, 230,000 sq ft in the heart of downtown Vancouver is likely too large for any known active retailer in the Canadian market to absorb on their own.

This leads to the theoretical possibilities of how the three levels — each spanning the floor area of most of a city block — can be absorbed.

Uniqlo would likely be a suitable fit to occupy a small fraction of the Nordstrom space. The Japanese fast fashion retailer previously told Daily Hive Urbanized it is interested in opening a flagship location in downtown Vancouver, but without any desirable space, they decided to establish a major presence in the Metro Vancouver market by opening its first locations in the region within the suburbs. The 2017-opened Uniqlo store in Metropolis at Metrotown mall, which was their first location in the entire region, recently expanded by a further 6,000 sq ft to reach a size of about 27,000 sq ft.

Uniqlo flagship stores are typically at least roughly 30,000 sq ft. A flagship Uniqlo in the Nordstrom space would theoretically take up just one-tenth of the department store’s total floor area.

uniqlo metropolis metrotown expansion

2022 expansion of Uniqlo at Metropolis at Metrotown. (Kenneth Chan/Daily Hive)

uniqlo metropolis metrotown expansion

2022 expansion of Uniqlo at Metropolis at Metrotown. (Kenneth Chan/Daily Hive)

Another theoretical potential retail opportunity is Ikea. No, we’re not talking about their ginormous big box stores surrounded by a sea of surface vehicle parking. In recent years, Ikea has expanded in Canada and the United States with a smaller urban store model that is anywhere from 20% to 30% of the size of their massive warehouse stores.

These urban stores are literally located in urban areas — in major city centres and shopping centres, serving customers who may be deterred from making the longer trip to their big suburban locations. Such urban stores have far smaller showroom spaces and focus on offering the smaller household products that are found in the “Market Hall” of the warehouse stores.

For example, in May 2022, an urban IKEA store opened within the small shopping mall at the base of the Aura condominium tower on Yonge Street in downtown Toronto. The 66,000 sq ft, two-storey Ikea reenergized the struggling mall, and there is even a loss leader “Swedish Deli” — essentially a downsized version of the “Swedish Restaurant.”

In November 2022, the chain announced it will open an 80,000 sq ft urban Ikea within a portion of the former Sears department store space at Scarborough Town Centre mall.

This spring, Ikea will open an urban store on Market Street in downtown San Francisco, within the 6×6 mall, which had been struggling since its 2016 completion. Ikea acquired the entire 250,000 sq ft retail building in September 2020 for US$200 million to create its first Ingka Centre retail hub concept in the United States, and the urban Ikea store will use just 70,000 sq ft.

Ikea could theoretically absorb about 70,000 sq ft of Nordstrom’s space at CF Pacific Centre.

ikea toronto downtown aura 382 yonge street

IKEA’s smaller format urban store at Aura in downtown Toronto. (Kenneth Chan/Daily Hive)

ikea toronto downtown aura 382 yonge street

IKEA’s smaller format urban store at Aura in downtown Toronto. (Kenneth Chan/Daily Hive)

ikea toronto downtown aura 382 yonge street

IKEA’s smaller format urban store at Aura in downtown Toronto. (Kenneth Chan/Daily Hive)

ikea toronto downtown aura 382 yonge street

IKEA’s smaller format urban store at Aura in downtown Toronto. (Kenneth Chan/Daily Hive)

ikea toronto downtown aura 382 yonge street 9

IKEA’s smaller format urban store at Aura in downtown Toronto. (Kenneth Chan/Daily Hive)

So far, the combined floor areas of Uniqlo and Ikea have only used up less than half of Nordstrom’s space at CF Pacific Centre. Another theoretical example of what could also fit in the Nordstrom space at CF Pacific Centre could be a food hall and marketplace, namely the world-renowned Eataly chain.

The high-end, Italian cuisine and goods chain currently has 40 locations worldwide. In 2019, Canada’s first Eataly opened in the base of the Manulife Building on Bloor Street near Yonge Street in downtown Toronto, occupying 50,000 sq ft over three levels — featuring four restaurants, seven eateries, three bars, 10,000+ products from Italy and Canada, five production labs, and a brewery.

In October 2022, CF Pacific Centre owner Cadillac Fairview announced Eataly will open at CF Sherway Gardens mall in suburban Toronto.

Eataly could theoretically occupy a similar floor area of about 50,000 sq ft at CF Pacific Centre, providing additional food and beverage options far beyond the mall’s existing underground food court, which is grossly undersized given the demand and does not provide a comfortable seating experience. It could potentially even replace the existing food court, which could in turn be repurposed as retail space.

“Large blocks of space downtown don’t come up very often so this will provide an opportunity for Cadillac Fairview to welcome a new entrant, enhance their current mix, or a combination of both,” Daniel Lee, the principal of retail for commercial real estate firm Avison Young Vancouver, told Daily Hive Urbanized.

“One category I could see them exploring is additional food offerings. The food court has always been a strong performer and I think they can build on that. Cadillac is a very sophisticated group with a long-term view and I have full confidence the end result will be something that is exciting for the downtown business and residents of the city.”

eataly manulife building toronto downtown

Eataly at the Manulife Building in downtown Toronto. (Shutterstock)

eataly food hall milan italy

Eataly in Milan, Italy. (Shutterstock)

eataly food hall marketplace

Eataly in Lower Manhattan in New York. (Shutterstock)

Eataly at the Manulife Building in downtown Toronto. (Kayla Gladysz/Daily Hive Toronto)

With e-commerce taking up a greater chunk of the retail market, mall landlords are increasingly leaning into immersive and experiential retail, such as food and entertainment, as a way to drive foot traffic. This is also the strategic approach of the future Oakridge Park (Oakridge Centre) mall, which is expected to open in late 2024. Its food court equivalent needs will be covered by a food hall — the world’s largest Time Out Market location.

Even with accommodating Uniqlo, Ikea, and Eataly, there is still space remaining in CF Pacific Centre’s Nordstrom to accommodate La Maison Simons, which is quite possibly one of the most underrated men’s and women’s clothing and apparel retailers.

In 2015, Quebec-based Simons opened its first and only BC location to date at Park Royal mall in West Vancouver. The company previously expressed interest in opening more locations across Canada.

Simons would likely see greater success than its predecessors at the CF Pacific Centre building, given that, unlike Nordstrom, it is considered a mid-range to high-end store — more accessible to a wider range of incomes, including fast fashion options.

Furthermore, Simons already has major store locations at a handful of Cadillac Fairview properties, including CF Carrefour Laval, CF Promenades St-Bruno, CF Fairview Pointe Claire, and CF Rideau Centre. Simons stores range in size between about 40,000 sq ft and about 110,000 sq ft.

simons park royal west vancouver

La Maison Simons at Park Royal mall in West Vancouver. (Kenneth Chan/Daily Hive)

simons park royal west vancouver

La Maison Simons at Park Royal mall in West Vancouver. (Kenneth Chan/Daily Hive)

Simons has shown its continued willingness to invest in brick-and-mortar locations. In May 2022, the store at CF Fairview Pointe Claire mall in Montreal opened as the chain’s newest location, built with an investment of $26.5 million. Then in June 2022, Simons announced it will open a 56,000 sq ft store at Halifax Shopping Centre in Spring 2024 at a cost of $15 million.

Simons at CF Pacific Centre would serve downtown Vancouver and the regional market well with a store size of 80,000 sq ft within Nordstrom’s space. But a smaller store of about 50,000 sq ft could also be adequate, given the relatively close proximity to the Park Royal store, which is about 100,000 sq ft.

In summary, all of these foot traffic-driving major businesses could potentially fit into Nordstrom’s 230,000 sq ft of space within CF Pacific Centre:

  • Uniqlo: 30,000 sq ft to 40,000 sq ft
  • IKEA: 60,000 sq ft to 70,000 sq ft
  • Eataly: 40,000 sq ft to 60,000 sq ft
  • La Maison Simons: 50,000 sq ft to 80,000 sq ft

These calculations do not account for potential other unique back-of-house needs or new common mall corridor areas in order to access the mix of new businesses.

UNIQLO Montreal

Artistic rendering of the Uniqlo store in downtown Montreal, which opened in 2020. (Uniqlo)

ikea san francisco market street ingka

Artistic rendering of the smaller urban format IKEA store on Market Street in downtown San Francisco, which will open in Spring 2023. (IKEA)

eataly london liverpool street

Artistic rendering of the Eataly on Liverpool Street in London, UK, which opened in 2021. (Eataly)

La Maison Simons-Simons unveils details about its new Halifax st

Artistic rendering of the La Maison Simons store at Halifax Shopping Centre, which will open in 2021. (Simons)

Just a block to the north, major changes have been made to CF Pacific Centre’s mid-block, including the recent opening of the flagship Apple Store, and the complete renovation of the former Four Seasons Vancouver Hotel tower for a new upscale chain, which will include a destination hotel restaurant lounge on the tower rooftop. The reimagined hotel space is expected to open in 2024 or 2025.

The adjacent flagship Hudson’s Bay department store building, which is not owned by Cadillac Fairview, is eyed for a complete mixed-use commercial redevelopment.

Last year, Hudson’s Bay revealed its proposal to provide a 12-storey vertical office tower expansion over the heritage store building, the conversion of the existing store’s upper fifth and sixth levels into office space, and a complete reconfiguration of the existing bottom four levels and basement level into retail/restaurant uses and indoor public spaces, including a downsized Hudson’s Bay flagship store of 350,000 sq ft — down from the existing store size of 650,000 sq ft. There would be one million sq ft of office space, enough to hold 5,000 workers.

For the block to the south, beyond the mall property, Cineplex is making progress on building a three-storey, 45,000 sq ft The Rec Room entertainment and dining hub in the Granville Entertainment District. It is expected to open in late 2024 or early 2025.

The City of Vancouver is also in the process of considering the rezoning application for major 800 Granville Street mixed-use redevelopment, which includes 97,000 sq ft of retail/restaurant uses, 86,000 sq ft of cultural/entertainment uses, and 468,000 sq ft of office space.

674 Granville Street Vancouver hudsons bay redevelopment

Artistic rendering of the redevelopment of Hudson’s Bay’s Vancouver flagship store at 674 Granville Street. (Perkins & Will/Streetworks Development/Hudson’s Bay Company)

855 Granville Street The Rec Room

August 2019 design of 855 Granville Street, Vancouver for Cineplex’s The Rec Room Granville. (Musson Cattell Mackey Partnership/Cineplex)

855 Granville Street The Rec Room

August 2019 design of 855 Granville Street, Vancouver for Cineplex’s The Rec Room Granville. (Musson Cattell Mackey Partnership/Cineplex)

800 granville street vancouver bonnis properties

August 2021 artistic rendering of the revised design for 800 Granville Street, Vancouver. (Perkins&Will/Bonnis Properties)

GET MORE URBANIZED NEWS
Want to stay in the loop with more Daily Hive content and News in your area? Check out all of our Newsletters here.
Buzz Connected Media Inc. #400 – 1008 Homer Street, Vancouver, B.C. V6B 2X1 [email protected] View Rules
Kenneth ChanKenneth Chan

+ News
+ Venture
+ Development
+ Opinions
+ Urbanized
ADVERTISEMENT