Campeau Corp.
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Campeau Corporation was a Canadian
real estate development Real estate development, or property development, is a business process, encompassing activities that range from the renovation and re-lease of existing buildings to the purchase of raw Real Estate, land and the sale of developed land or parce ...
and investment company founded by entrepreneur
Robert Campeau Robert Joseph Antoine Campeau (August 3, 1923 June 12, 2017) was a Canadian financier and real estate developer. Starting from a single house constructed in 1940 in the Alta Vista neighbourhood of Ottawa, Ontario, Campeau built a large land dev ...
. It was infamous from its ultimately unsuccessful acquisitions of American
department store A department store is a retail establishment offering a wide range of consumer goods in different areas of the store under one roof, each area ("department") specializing in a product category. In modern major cities, the department store mad ...
holding companies
Allied Stores Allied Stores was a holding company of department store chains in the United States. It was founded in the 1930s as part of a general consolidation in the retail sector by B. E. Puckett. See also Associated Dry Goods. It was the successor to Hahn ...
in 1986 and
Federated Department Stores Macy's, Inc. (previously Federated Department Stores, Inc.) is an American holding company of department stores. Upon its establishment in 1929, Federated held ownership of the regional department store chains Abraham & Straus, Lazarus (departm ...
in 1988. The whole organization soon was mired in bankruptcy and spurred the decline of the regional department store.


History

Synonymous with its founder,
Ottawa Ottawa is the capital city of Canada. It is located in the southern Ontario, southern portion of the province of Ontario, at the confluence of the Ottawa River and the Rideau River. Ottawa borders Gatineau, Gatineau, Quebec, and forms the cor ...
-based Campeau was able to construct both office complexes and residential subdivisions to accommodate Canada's rapidly expanding
civil service The civil service is a collective term for a sector of government composed mainly of career civil service personnel hired rather than elected, whose institutional tenure typically survives transitions of political leadership. A civil service offic ...
. Campeau Corporation had two main rivals in the residential housing market: Assaly Construction Limited and Minto Developments Inc., the latter owned by the family of future Ottawa mayor Lorry Greenberg.


Policy

For many years, it was city policy in Ottawa that buildings in the downtown core not be taller than the ''
Peace Tower The Peace Tower () is a focal bell and clock tower sitting on the central axis of the Centre Block of the Canadian parliament buildings in Ottawa, Ontario. The present incarnation replaced the Victoria Tower, after the latter burned down in ...
'' of the
Parliament Hill Parliament Hill (), colloquially known as The Hill, is an area of Crown land on the southern bank of the Ottawa River that houses the Parliament of Canada in downtown Ottawa, Ontario. It accommodates a suite of Gothic revival buildings whose ...
buildings. Campeau found this rule to be unnecessary and was drawn into conflict with city council over large high-rise developments such as
Place de Ville Place de Ville is a complex of office towers in downtown Ottawa, Ontario, Canada. It consists of four office buildings: Place de Ville A, B, and C; and the 'Podium' building, which houses a shuttered "piggy-back" cinema enveloped with function ...
. Campeau's real estate development success soon spread outside Ottawa. In Toronto, its notable developments included Scotia Tower (the city's second-tallest skyscraper) and the Harbour Castle Hotel (now part of the
Westin Hotels Westin Hotels & Resorts is an American upscale hotel chain owned by Marriott International. , the Westin Brand has 226 properties with 82,608 rooms in multiple countries in addition to 58 hotels with 15,741 rooms in the pipeline. History We ...
chain) - which helped revitalize the city's waterfront area.


Acquisitions

In the 1980s, Campeau embarked on a series of
leveraged buyout A leveraged buyout (LBO) is the acquisition of a company using a significant proportion of borrowed money (Leverage (finance), leverage) to fund the acquisition with the remainder of the purchase price funded with private equity. The assets of t ...
s, first bidding unsuccessfully on the
Royal Trustco The Royal Trust Company is a Canadian trust company that was founded in 1892 in Montreal, Quebec. By the late 20th century, it carried out trust, financial, real estate and deposit services in over 100 branches in Canada, the U.S. and overseas. I ...
(now owned by
Royal Bank of Canada Royal Bank of Canada (RBC; ) is a Canadian multinational Financial institution, financial services company and the Big Five (banks), largest bank in Canada by market capitalization. The bank serves over 20 million clients and has more than ...
). Its founder's brash, confrontational manner made him an outsider to much of the conservative Canadian business establishment. As his empire expanded, Campeau ventured into the United States, looking for acquisitions that would add
shopping mall A shopping mall (or simply mall) is a large indoor shopping center, usually Anchor tenant, anchored by department stores. The term ''mall'' originally meant pedestrian zone, a pedestrian promenade with shops along it, but in the late 1960s, i ...
real estate to his portfolio of assets. In 1986, Campeau acquired
Allied Stores Allied Stores was a holding company of department store chains in the United States. It was founded in the 1930s as part of a general consolidation in the retail sector by B. E. Puckett. See also Associated Dry Goods. It was the successor to Hahn ...
. In 1988, the company followed with the purchase of
Federated Department Stores Macy's, Inc. (previously Federated Department Stores, Inc.) is an American holding company of department stores. Upon its establishment in 1929, Federated held ownership of the regional department store chains Abraham & Straus, Lazarus (departm ...
, owner of
Bloomingdale's Bloomingdale's Inc. is an American luxury department store chain founded in 1861 by Joseph Bloomingdale and Lyman Bloomingdale. It was acquired by Federated Department Stores in 1930, which purchased the Macy's department store chain in 1994, ...
. Campeau retained banker
Bruce Wasserstein Bruce Jay Wasserstein (December 25, 1947 – October 14, 2009) was an American investment banker, businessman, and writer. He was prominent in the mergers and acquisitions industry, credited with working on 1,000 transactions with a total value ...
to assist with the transactions. The purchases were criticized by ''
The New York Times ''The New York Times'' (''NYT'') is an American daily newspaper based in New York City. ''The New York Times'' covers domestic, national, and international news, and publishes opinion pieces, investigative reports, and reviews. As one of ...
'', which noted "recent LBO's benefited the target companies' shareholders who received high takeover prices. But most of the gains seemed to have come at the expense of bondholders, creditors and employees." In the late 1980s, the debt obligations that needed to be covered following the merger were too large, and exacerbated by a market downturn that hurt retail sales. Campeau Corporation was unable to meet its debt obligations. Federated and Allied eventually filed for bankruptcy reorganization. The company was eventually acquired by
Olympia and York Olympia & York (also spelled as Olympia and York, abbreviated as O&Y) was a major international property development firm based in Toronto, Ontario, Canada. The firm built major financial office complexes including Canary Wharf in London, the W ...
who went bankrupt, and Campeau Corporation ceased to exist.


See also

*
Carma Developers Carma Developers, founded in 1958, is a Canadian residential land developer with master-planned communities throughout Canada and the United States. Its head offices are located in Calgary, Alberta, where it is the largest residential land develop ...


References


External links


Ranch & Land Broker
{{Private equity and venture capital Home builders Companies based in Ottawa Defunct companies of Ontario Private equity firms of Canada Real estate companies of Canada Companies that have filed for bankruptcy in Canada Construction and civil engineering companies of Canada Defunct real estate companies