Cost of Winnipeg Bay store redevelopment jumps to $310M: First Nations group

WINNIPEG — A First Nations-led project to redevelop the historic Hudson’s Bay Co. building in downtown Winnipeg to advance reconciliation has doubled in cost nearly three years after it started.

The Southern Chiefs’ Organization said Wednesday the price tag is at $310 million, more than double the original estimate of $130 million.

The organization, which represents 32 First Nations communities in Manitoba, took over the former store, which opened in 1926 and closed in 2020.

Grand Chief Jerry Daniels said the rise in cost is related to supply chain pressures, inflation and U.S. tariff threats on construction materials. He added that heritage building upgrades, structural reinforcements and energy efficiency improvements also added to the final cost.

The plan is for the six-storey building to be transformed and include 373 housing units, restaurants and office and retail spaces for entrepreneurs.

Demolition of some of the interior has already begun. On the fifth level, flooring has been stripped down to reveal some of the original hardwood, while decades-old wallpaper and posters peek out from some corners of the walls.

A huge crane was recently set up outside the building to help with the construction of an atrium.

“As construction moves forward, the project remains a beacon of First Nations empowerment, urban renewal and a downtown revitalized,” Daniels said during a press conference inside the building.

Daniels said the project is expected to be completed in 2028.

The federal government provided $65 million in a combination of forgivable and low-interest loans in April 2022, when it was announced that the Southern Chiefs’ Organization would take over the building. In 2024, after it was determined the project was running over budget, Ottawa put up another $31 million.

The previous Progressive Conservative provincial government committed $35 million in support, while the City of Winnipeg provided $10 million in tax breaks.

The original project was to include a health centre offering Western and traditional medicine, but Daniels said that’s being re-examined due to costs.

“We’re not firm on that yet … we’ll look at what makes sense,” he said.

Assisted living suites for elders have been scrapped as well, as the organization didn’t have an initial cost for it. Daniels said a governance office for the 32 First Nations has also been scaled back to a smaller meeting space for the organization.

The group hasn’t received any other financial commitments from its partners, but Daniels said he’s confident funding will come in.

“We’ve been working with all levels of government and we’ve been sharing information about the planning and where we’re at and trying to get to what makes sense for us and what’s workable,” he said.

Manitoba’s NDP government, elected in 2023, said it’s committed to the project and looks forward to meeting with the Southern Chiefs’ Organization to learn more about it.

“The redevelopment of … the former Hudson’s Bay store is a profound reimagining of Winnipeg’s downtown at a time when it is crucially needed,” said Housing Minister Bernadette Smith.

The Bay’s current financial struggles aren’t expected to impact the redevelopment, said Daniels. The company, one of North America’s oldest, is looking to liquidate and close most of its roughly 80 stores in Canada.

Daniels said there’s an opportunity for other Indigenous groups to consider taking over other historic Bay stores across the country.

He said he would be willing to help other Indigenous organizations thinking about it.

“Any time we can create opportunity and partnership throughout the country, we absolutely support that.”

This report by The Canadian Press was first published March 19, 2025.

Brittany Hobson, The Canadian Press