Simon Property Group saw gains in the second quarter of 2024, leading the company’s leadership to believe it is in a stable position despite volatility in the stock market on Monday.
The firm, which specializing in retail centers such as The Forum Shops at Caesars Palace in Nevada, reported earnings from operations of $1.09 billion in the second quarter, compared to $1.08 billion in the second quarter of 2023, and $2.42 billion in the first half of the year, in contrast to $2.10 billion from same period last year.
Occupancy at Simon’s malls and outlets in the first half of the year was 95.6 percent compared to the 94.7 percent during the same time last year. There were also 1,400 leases signed across its portfolio, totaling 4.8 million square feet in the second quarter, according to Simon.
David Simon, chairman of Simon, said during the Monday earnings call it was not likely that short term distress in the stock markets, like the S&P 500 nosediving by 1,000 points earlier in the day, would have any major effect on consumer spending and retailer performance.
“My history would suggest short term fluctuations mean absolutely nothing,” Simon said. “I do think the downward trend or the volatility is not going to really impact the consumer in the next short period of time, but if you see it for several months, then I would expect us to see some slowdown in consumer spending.”
While the stock market woes were the most serious drop since 2022, there were signs of stability on Tuesday with prices on the New York Stock Exchange following a rebound in the Japanese market.
“I think that the consumer is used to seeing some volatility,” Simon said. “I hope those investors are smart enough to sell and then spend the money in our malls, that would be a good cycle for us.”
While Simon has seen stability in it balance sheet it’s also expecting more funds from operations thanks to the Aug. 15 opening of Tulsa Premium Outlets, a 338,000-square-foot center in Jenks, Okla.
In the first half of the year, Simon also paid off 10 “non-recourse mortgage loans” totaling $1.1 billion, according to the company.
Mark Hallum can be reached at mhallum@commercialobserver.com.
