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About Simon Property Group, Inc.

Simon Property Group is the largest shopping mall and retail center owner in the US. The self-managed, self-administered real estate investment trust (REIT) owns, develops, and manages regional shopping malls, outlet malls (under the Premium Outlet and The Mills brands), boutique malls, and shopping centers. Its real estate portfolio is composed of more than 200 retail properties totaling approximately 190 million sq. ft. of leasable space. Its portfolio covers 35 states and Puerto Rico, about 30 Premium Outlets and Designer Outlet properties primarily located in Asia, Europe and Canada.

Operations

Simon Property's primary operations are the ownership, development, leasing, and management of its retail real estate portfolio. The extent of its involvement, and revenue generation, varies by its degree of ownership. In addition to owning some 200 properties in the US, it is a joint-venture partner in about 80, mostly international, properties. It also uses joint ventures to hold equity investments in several European real estate holding companies. It manages the day-to-day operations of its owned properties as well as about 80 of its joint-venture properties. The company conducts its international operations primarily through joint venture arrangements and account for the majority of these international joint venture investments using the equity method of accounting.

The company makes about 90% of its revenue from lease income. Management fees and other revenues, and so as other income generate the remaining sales.

Geographic Reach

Indianapolis, Indiana-based Simon Property Group owns or holds an interest in 204 income-producing properties in the US, 106 malls, 69 Premium Outlets, 14 Mills, four lifestyle centers, and 11 other retail properties in 37 states and Puerto Rico, 29 Premium Outlets and Designer Outlet properties primarily located in Asia, Europe and Canada. The company also owns a 22.2% equity stake in Klépierre SA, or Klépierre and shopping centers located in 15 countries in Europe.

Sales and Marketing

Simon Property enters long-term tenancy contracts with retailers to fill its properties.

Many of its properties are anchored by major tenants such as JCPenney, Macy's, Dillard's, Neiman Marcus, and Bloomingdale's and supplemented with smaller stores like Dick's Sporting Goods, Nordstrom, Kohl's, and AMC Theatres. Its Premium Outlets are home to a variety of popular retailers including Adidas, American Eagle Outfitters, Ann Taylor, Columbia Sportswear, Michael Kors, Tommy Hilfiger, and The North Face.

Occupancy for its US malls, Premium Outlets, and Mills-branded properties remain above 80%. No one tenant accounts for more than 5% of its consolidated revenue.

Financial Performance

The long-term trend in revenue has been positive over recent years. Revenue has climbed steadily since 2015, growing from $5.3 billion in that year to $5.8 billion in 2019. Net income has grown in parallel, jumping from $1.8 billion to $2.1 billion over the five-year period.

Simon Property's 2019 revenue of $5.8 billion was the result of about 2% growth from 2018's $5.6 billion in part as a result of higher lease income.

Net income decreased about $339 million to $2.1 billion in 2019 compared to $2.4 billion in 2018.

Cash at the end of 2019 was $669.4 million. Cash from operations contributed $3.8 billion to the coffers, while investing activities used $1.1 billion million, mainly for capital expenditures. Financing activities used another $2.6 billion for repayments of debt, distributions to stockholders and preferred dividends and purchase of treasury stock.

 

Strategy

The company's international strategy includes collaborating with established real estate companies and financing international investments with local currency to minimize foreign exchange risk. To support its growth, the company employs a three-fold capital strategy which are providing the capital necessary to fund growth, maintaining sufficient flexibility to access capital in many forms, both public and private and manage its overall financial structure in a fashion that preserves its investments grade credit ratings.

In early 2019, the company announced the launched of Shop Premium Outlets (SPO), a new online outlet shopping platform designed to drive incremental business both online and in the stores of participating retailers. SPO will enable the highly engaged Premium Outlets customer base to shop 24/7 for their favorite fashion, luxury and lifestyle brands, all in one place, up to 65% off every day.

Company Background

Simon Property Group helped change the face of the US retail landscape from mom-and-pop stores to shopping malls. The original Simon Property Group (formed in 1993) was the offshoot of brothers Melvin and Herbert Simon's Melvin Simon & Associates (MSA, founded in 1959). 

To get started, the Simons sometimes borrowed cash from friends, but during the 1960s and 1970s developers could usually borrow 100% of a shopping center's construction costs after securing an anchor tenant. Leases then provided money to repay debt and make a down payment on the next project. The Simons consistently retained equity, developing a huge asset base that they used as collateral for larger projects. 

The new strip malls boasted retail's two most important virtues -- price and convenience -- and in time they developed into the modern mall. MSA built its first indoor mall in the mid-1960s in snowy Fort Collins, Colorado. By the late 1960s, MSA and other developers were consumed with mall projects. 

As the 1989 real estate slump hit, the Simons were busy building the largest mall in the country, just outside Minneapolis. Completed in 1992, the Mall of America included a roller coaster, a two-story miniature golf course, and a walk-through aquarium. In 1993 Simon Property Group went public in one of the largest IPOs of its time. 

Simon Property Group, Inc.

225 W Washington St
Indianapolis, IN 46204-3438
Phone: 1 (317) 636-1600

Firm Stats

Employer Type: Publicly Owned
Stock Symbol: SPG
Stock Exchange: , NYSE
EVP and CFO: Andrew A. Juster
Chairman and CEO: David Simon
President and COO: Richard S. Sokolov
Employees (This Location): 1,000
Employees (All Locations): 4,500

Major Office Locations

Indianapolis, IN

Other Locations

Anchorage, AK
Boaz, AL
North Little Rock, AR
Brea, CA
Cabazon, CA
Camarillo, CA
Carlsbad, CA
Folsom, CA
Gilroy, CA
Laguna Hills, CA
Mission Viejo, CA
Orange, CA
Palo Alto, CA
San Diego, CA
Santa Rosa, CA
Torrance, CA
Vacaville, CA
Westminster, CA
Alamosa, CO
Aurora, CO
Clinton, CT
Waterford, CT
Dover, DE
Boca Raton, FL
Boynton Beach, FL
Coral Springs, FL
Doral, FL
Estero, FL
Fort Myers, FL
Jensen Beach, FL
Leesburg, FL
Melbourne, FL
Miami, FL
Ocala, FL
Orange Park, FL
Orlando, FL
Panama City Beach, FL
Pensacola, FL
Port Charlotte, FL
Port Richey, FL
Saint Petersburg, FL
Sanford, FL
South Miami, FL
Sunrise, FL
Atlanta, GA
Buford, GA
Dawsonville, GA
Duluth, GA
Kennesaw, GA
Waipahu, HI
Cedar Rapids, IA
Davenport, IA
Alton, IL
Aurora, IL
Lincolnwood, IL
Orland Park, IL
Peoria, IL
Springfield, IL
Bloomington, IN
Edinburgh, IN
Evansville, IN
Greenwood, IN
Indianapolis, IN
Kokomo, IN
Lafayette, IN
Michigan City, IN
Mishawaka, IN
Muncie, IN
Noblesville, IN
Pleasant Prairie, IN
Topeka, KS
Lake Charles, LA
Boston, MA
Braintree, MA
Chestnut Hill, MA
Danvers, MA
Hyannis, MA
Lee, MA
Needham, MA
North Attleboro, MA
Peabody, MA
Saugus, MA
Wrentham, MA
Bowie, MD
Glen Burnie, MD
Hanover, MD
Waldorf, MD
Bangor, ME
Kittery, ME
Portland, ME
Ann Arbor, MI
Albertville, MN
Duluth, MN
Edina, MN
Saint Paul, MN
Independence, MO
Lebanon, MO
Osage Beach, MO
Springfield, MO
Smithfield, NC
Merrimack, NH
Salem, NH
East Brunswick, NJ
Edison, NJ
Elizabeth, NJ
Flemington, NJ
Hackensack, NJ
Jackson, NJ
Jersey City, NJ
Lawrenceville, NJ
Livingston, NJ
Rockaway, NJ
Toms River, NJ
Albuquerque, NM
Las Vegas, NV
Reno, NV
Central Valley, NY
Garden City, NY
Huntington Station, NY
Lake Grove, NY
Lakewood, NY
New York, NY
White Plains, NY
Yorktown Heights, NY
Ada, OH
Aurora, OH
Cleveland, OH
Lima, OH
Oklahoma City, OK
Tulsa, OK
Langhorne, PA
North Wales, PA
Philadelphia, PA
Pittsburgh, PA
Tannersville, PA
West Mifflin, PA
Whitehall, PA
Charleston, SC
Greenville, SC
Rapid City, SD
Sioux Falls, SD
Crossville, TN
Knoxville, TN
Memphis, TN
Austin, TX
Cedar Park, TX
Corsicana, TX
El Paso, TX
Garland, TX
Georgetown, TX
Harlingen, TX
Houston, TX
Katy, TX
Longview, TX
Mcallen, TX
Mercedes, TX
Midland, TX
San Antonio, TX
San Marcos, TX
Tyler, TX
Arlington, VA
Charlottesville, VA
Chesapeake, VA
Harrisonburg, VA
Leesburg, VA
North Chesterfield, VA
Winchester, VA
Kennewick, WA
North Bend, WA
Quil Ceda Village, WA
Seattle, WA
Tacoma, WA
Fond Du Lac, WI
Green Bay, WI
Greendale, WI
Johnson Creek, WI