Struggling retailer closes its doors in Burlington
Retailer, “Pink” by Victoria's Secret recently closed at Mapleview Centre in Burlington. If you had no idea, it’s probably because the struggling Victoria's Secret brand has been quietly shutting down some of its stores in Canada, according to a report by Mario Toneguzzi of Retail Insider.
Victoria Secret has been battling allegations of a toxic culture, as well bad publicity as Les Wexner, who founded the parent company, has been linked in the media with the late financier Jeffrey Epstein, who was accused of sex-trafficking.
"Really for the last 24 to 28 months we've seen deep double-digit comp sales declines in Victoria's Secret across the entire portfolio from British Columbia all the way to the Maritimes,” Darryl Schmidt, Vice President, Retail Leasing in the Western Portfolio Office of mall operator Cadillac Fairview told Retail Insider.
“As we got closer to some of the expirees it was becoming apparent that there was going to be a disconnect between their rental expectations and our rental expectations given their declining sales performance.”
The lingerie brand's current owner, L Brands, said Feb. 20 that the private equity firm Sycamore Partners will buy 55 per cent of Victoria's Secret for about US$525 million.
“Really we've been seeing this storm coming for a while,” continued Schmidt. “Some of it speaks to the fact that when we did that first tranche of business they thought that Victoria's Secret was going to be 10 to 15 stores in Canada then it was phenomenally successful and they wound up opening 40 plus stores. I think they cannibalized some of their own market share.”
It’s been a rough start to 2020 for many retailers in Canada. By Retail Insider’s count, “well over 700 store locations” will be closing or have recently closed across the country.
On the flip side, international retailers continue to enter Canada in record numbers. In 2019, Retail Insider counted more than 30 global brands that had opened standalone stores in Canada. There have reportedly been more than 100 international brands crossing into Canada since 2017.
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