Target Corp. announced Thursday a confirmed list of the 125 Zellers locations it will be taking over across the country, with stores beginning to open next March.
Later this year, Target will confirm additional locations that will open in early 2014.
Five other Ottawa locations were previously named as future Target stores, including in Bayshore Shopping Centre, Hazeldean Mall, Meadowlands Shopping Centre, Place D’Orleans and RioCan St. Laurent.
“Construction has already begun on our first set of stores and we are excited to see the transformation as the Target brand comes to life in Canada,” stated Tony Fisher, president of Target Canada.
Each site will be closed for a period of six to nine months for extensive renovations, with more than $10 million spent on each new location and between 150 to 200 people hired in each store.
Target, a 109-year old American retailer that was part of Dayton-Hudson Corp. before changing its name in 2000, is one of the biggest U.S. department store chains, with revenues of more than US$67 billion in its last fiscal year.
The company has more than 355,000 employees and is the second-biggest discount retailer in the U.S. after Wal-Mart Stores Inc.
Target is expanding to Canada in a similar way Wal-Mart did in 1994, after the world's biggest retailer bought the chain of Woolco department stores in Canada, refurbished them and renamed them Wal-Mart Canada.
The F.W. Woolworth Co. started the Woolco chain in the early 1960s in Columbus, Ohio and expanded it to hundreds of stores in North America and the United Kingdom. The stores went bankrupt in the United States and Britain in the 1980s but kept active in Canada until they were sold in 1994.
The list announced by Target in May includes sites owned by some 22 property owners and landlords with whom Target has reached lease agreements.
RioCan Real Estate Investment Trust (TSX:REI.UN), one of Canada's largest retail landlords, said 21 of its 34 locations with Zellers stores were on the initial list.
"This transaction highlights the intrinsic value in our portfolio, and will bring tremendous potential for repositioning and the opportunity to further enhance value and cash flow growth in our centres," RioCan president and chief executive Edward Sonshine said in a statement.
Primaris Retail Real Estate Investment Trust (TSX:PMZ.UN) owns five locations, while Homburg Canada Real Estate Investment Trust (TSX:HCR.UN) owns three spots in Quebec. Morguard (TSX:MRC) and Morguard Real Estate Investment Trust (TSX:MRT.UN) own 12 of the locations.
Ivanhoe Cambridge, the real estate arm of the Caisse de depot et placement du Quebec, owns 14 locations, while Cadillac Fairview, the real estate investment arm of the Ontario Teachers' Pension Plan Board, owns seven locations.
Target said it hopes to finalize the acquisition of the sites quickly and pay the first half of the $1.825 billion it agreed to for the locations.
Under the deal signed earlier this year to take over up to 220 Zellers locations from the Hudson's Bay Co., Target said it will continue to select additional locations before it makes a second payment in the fall.
Hudson's Bay has 279 Zellers locations. Stores that Target does not want could be sold to other retail giants like Wal-Mart (NYSE:WMT) or could remain in the hands of the Bay.
Target also announced it will establish a Canadian headquarters in Mississauga, Ont., just west of Toronto. The retailer has signed a deal for 180,000 square-feet of office space that will be occupied in early 2012 after some remodelling.
– With files from Canadian Press
Internet site reference: http://www.obj.ca/Local/Retail/2012-07-12/article-3029752/Billings-Bridge-Target-to-open-fall-2013/1