Primaris Lines Up Tenants for 84% of Hudson's Bay Space

For two years the open question on Primaris was what its empty Hudson's Bay boxes were worth. On June 29, management answered it. The enclosed-mall owner said it has leased or is in advanced negotiations on 84% of its former Hudson's Bay footprint, disclosed roughly C$168 million of shopping-centre transactions, and pegged the surplus land buried under its parking fields at C$275–375 million. The vacancy that read as a liability is being reframed as a pipeline — and it now has dollar figures attached.

Key Takeaways

• 84% of the vacated Hudson's Bay space is leased or in advanced negotiation, with 608,500 sq ft already under long-term leases.
• Backfill rent climbs to C$14.9M from C$3.7M — a 298% uplift toward ~C$22M of stabilized cash NOI at yields above 10%.
• Four June deals net ~C$168M of capital recycling, and Primaris flags C$275–375M of excess land for monetization.

The Hudson's Bay Backfill

The vacancy that hung over Primaris now has a lease-up schedule. On June 29, the trust said it has leased or is in advanced negotiations on 84% of its former Hudson's Bay anchor footprint — about 881,400 square feet of vacated Bay space, per Connect CRE. Of that, 608,500 square feet is already locked under long-term leases with high-credit tenants.

The economics are the story. The backfilled space is set to generate C$14.9 million of annual rental revenue against just C$3.7 million Hudson's Bay paid — a 298% increase. Once redevelopment finishes, Primaris targets C$18.9 million of annualized net rent and roughly C$22 million of annual cash NOI from the former Bay locations, on a C$175–225 million capex budget at unlevered yields above 10%. Stack in completed leases and leasing at its top-10 properties, and management now sees ~C$52 million of incremental annual cash NOI landing by June 2029.

Recycling C$168M of Capital

Alongside the leasing update, Primaris disclosed ~C$168 million of shopping-centre transactions — recycling capital inside the enclosed-mall segment rather than expanding the balance sheet. It sold its 50% managing interest in McAllister Place in Saint John for C$32 million and Marlborough Mall plus the Professional Centre in Calgary for C$67.5 million. It bought the remaining 50% of Regent Mall in Fredericton for C$64 million, taking full ownership, and picked up the adjoining former Hudson's Bay store at Devonshire Mall in Windsor for C$4.5 million to clear for demolition and a new entrance.

Productivity is rising underneath the dealmaking: same-store sales reached C$817 per square foot, up from C$801. And management put a number on the land hidden under its lots — C$275–375 million of excess land across roughly 120 acres, plus about C$200 million of non-core retail pads earmarked for disposition. Back in April, Primaris also teamed with Immostar — taking a 25% stake to Immostar's 75% — to buy open-air retail next to Les Galeries de la Capitale for C$62.3 million across about 307,900 square feet, fully leased, per Gowling WLG.

Q1 Underwrites the Guidance

The first-quarter print, reported April 28, gives the redevelopment story a stable base. Total rental revenue was C$177.0 million, and net income rose to C$41.9 million from C$31.2 million a year earlier. FFO held at C$0.425 per diluted unit — down 3.2% reported, but up 1.6% excluding a prior-year tax item — for a 51.8% payout ratio against a reported NAV of C$21.50 per unit. Committed occupancy held at 89.9% (in-place 86.4%), liquidity sat at C$626.8 million, and leverage was a conservative 6.0x net debt to adjusted EBITDA. Primaris signed 114 lease renewals across 372,000 square feet at a +5.5% weighted-average spread, per RENX, while its NCIB repurchased 195,300 units near C$17.10 — a ~20.5% discount to NAV.

Management reaffirmed full-year guidance: C$390–400 million of cash NOI and C$1.85–1.90 of FFO per unit, with G&A nudged up to C$44–46 million on roughly C$2 million of failed-transaction costs. DBRS confirmed its BBB (High) / Stable rating, and the trust held the monthly distribution at C$0.07333 per unit — about C$0.88 annualized, unchanged in its latest declaration.

The Market's Read

Investors have already moved. PMZ.UN is up about 40% over six months — roughly +39.8% year-to-date — to around C$22.13, right at the C$22.0–22.3 average consensus but still shy of the Street's individual buy targets: CIBC at C$25.00, Canaccord C$24.50, TD Cowen C$24.00, RBC C$23.00, with Scotiabank holding at C$22.00. After a run like that, much of the good news may already be priced in near-term. The chart marks the June 29 update.

What to Watch

• Backfill execution — turning the 84% leased-or-negotiating figure into signed leases and rent-paying NOI on schedule by June 2029.
• Land monetization — the first concrete sale that converts the C$275–375 million excess-land estimate into proceeds.
• Guidance delivery — whether cash NOI lands inside the reaffirmed C$390–400 million range despite the higher G&A.

The Bottom Line

Primaris has turned its biggest perceived liability — vacant Hudson's Bay anchors — into a quantified pipeline: 84% of that space leased or in negotiation, backfill rent rising 298% to C$14.9 million, and roughly C$22 million of stabilized cash NOI at yields above 10%. Add ~C$168 million of capital recycling and C$275–375 million of excess land, and the re-rating that lifted the units ~40% in six months has real fundamentals underneath it. The open question is timing — the bulk of the ~C$52 million NOI uplift is a 2029 event, not a 2026 print.

Sources

• Primaris Leases Most Of Its Former Hudsons Bay Company Store Spaces
  Connectcre
• Primaris Reit 62m Acquisition
  Gowlingwlg
• Primaris Reit Announces Q1 2026 Results Reaffirms Guidance
  Barchart
• Primaris Is In Solid Position With Better Results Anticipated
  Renx
• Primaris REIT Announces Distribution For May 2026
  Investors