Simon Property Group Inc.

Simon's malls and outlets are still growing. Real Estate FFO rose 4.7% to $3.37 a share in the third quarter. That measure is funds from operations, the REIT industry's core earnings figure, which here also leaves out retail-investment results and market-value swings. Domestic property net operating income (NOI: rents less property costs) rose 6.6%, and full-year guidance rose to $13.30–$13.40.

Growth is slowing once the Taubman purchase is taken out, and expiring 3–4% debt is being replaced at 5.45–7.28%. Over nine months, cash from operations covered capital spending and all distributions with about $92M to spare. Buybacks were paid for with borrowing and cash on hand (my calculation).

• Earnings, Q3 against a year earlier:
• Real Estate FFO $3.37 against $3.22.
• FFO $3.09 against $3.25.
• GAAP earnings per share $1.54 against $1.86, including $0.27 of non-cash losses.
• Revenue $1,814.6M against $1,601.6M.
• Operations: occupancy 96.5% against 96.4%; base rent $62.75 a square foot against $59.14.
• Guidance and dividend:
• Real Estate FFO guidance raised to $13.30–$13.40 from $13.20–$13.30.
• GAAP net income guidance cut to $6.32–$6.42 a share from $6.47–$6.57.
• The Q4 dividend is $2.30, up 4.5%.
• Financing:
• $800M of notes at a 5.45% average coupon.
• About $970M of secured loans at 6.33%.
• $540M of mortgages repaid by unencumbering two properties.
• $236.5M of buybacks.
• Acquisition: an agreement to buy University Village in Seattle, at an undisclosed price.

Its findings, each with the evidence, the strongest counterpoint and what would prove it wrong:

• Leasing is strong, but property income growth is slowing as the Taubman lift fades
• Refinancing is resetting 3–4% debt to 5.5–7%, the main brake on per-share growth
• The headline measure leaves out losses that are partly real

Then its finances, the quality of its earnings, its management, the case for and against, and what to watch, its claims cited to the filings and checked against them.

Your email and the code we send it, no card. The report then opens: a free account has 2 free reports a month from the library, the reports already written. Already have a Viridis account? Use its email, and the report goes on it. You also see what SPG files, free: its deadlines and its red flags.

Subscribe: your plan’s reports work on any company that files with the SEC, written for you if nobody has asked yet, and each new one on the companies you choose comes as they file.

In Claude or ChatGPT, ask: “What does Viridis's report on SPG say?” Add Viridis to Claude, or to ChatGPT.