No MBA- It makes plenty of sense. When you short it needs to be covered by borrowing the stock.
This is Canada and you do not need to borrow before you short, and you do not need to locate either before you short.
They are either looking to borrow against a current short (where they may have been recalled from another lender) or they want to short another 500k and are locating stock, or they are naked short.
QG
I know this because I work in equity finance. This is what i do.