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Simon Property Group reports improved quarterly results

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Simon Property Group Inc., the largest U.S. shopping-mall owner, said Friday morning that second-quarter earnings rose as national retail sales improved.

The Indianapolis-based real estate giant earned $152.5 million, or 52 cents per share, in the quarter ended June 30, compared to a loss of $20.8 million, or 8 cents per share, in the same period of 2009. The 2009 results included an impairment charge of $140.5 million, or 43 cents per share.

Funds from operations climbed to $487.7 million, or $1.38 a share, from $313.1 million, or 96 cents, a year earlier, the company said. The year-ago figure included a non-cash impairment expense of 42 cents a share. The company also affirmed its adjusted FFO forecast for the year of $5.77 to $5.87 a share.

Mall owners like Simon Property are starting to benefit from a pickup in consumer spending. June retail sales excluding automobiles, gas stations and restaurants gained 3.3 percent from a year earlier, according to the National Retail Federation, a Washington, D.C.-based trade group.

Simon was expected to have funds from operations of $1.34 a share, the average estimate of 19 analysts in a Bloomberg survey.

The charge in the second quarter of 2009, totaling $140.5 million, related to the decline in value of an investment in Liberty International Plc.

FFO is a cash-flow measure used by real estate investment trusts. It excludes depreciation and other items and doesn’t conform to generally accepted accounting principles.

Simon had $2.6 billion of cash on hand at June 30.

The company, which has stakes in almost 400 properties in North America, Europe and Asia, released results before the start of regular U.S. trading. The shares fell $1.20, or 1.4 percent, to $87.93 Thursday in New York Stock Exchange composite trading.

Simon dropped a bid this year to buy or invest in its largest competitor, Chicago-based General Growth Properties Inc., which filed for Chapter 11 bankruptcy protection in 2009.

"Our positive momentum from the first quarter continued," said Simon CEO David Simon in a prepared statement. “The improvement in business conditions extended into the second quarter as demonstrated by higher occupancy and sales. Sales for our malls and Premium Outlets during the second quarter of 2010 were 4.9 percent higher than in the second quarter of 2009, and occupancy grew 90 basis points from March 31, 2010.”

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  1. The east side does have potential...and I have always thought Washington Scare should become an outlet mall. Anyone remember how popular Eastgate was? Well, Indy has no outlet malls, we have to go to Edinburgh for the deep discounts and I don't understand why. Jim is right. We need a few good eastsiders interested in actually making some noise and trying to change the commerce, culture and stereotypes of the East side. Irvington is very progressive and making great strides, why can't the far east side ride on their coat tails to make some changes?

  2. Boston.com has an article from 2010 where they talk about how Interactions moved to Massachusetts in the year prior. http://www.boston.com/business/technology/innoeco/2010/07/interactions_banks_63_million.html The article includes a link back to that Inside Indiana Business press release I linked to earlier, snarkily noting, "Guess this 2006 plan to create 200-plus new jobs in Indiana didn't exactly work out."

  3. I live on the east side and I have read all your comments. a local paper just did an article on Washington square mall with just as many comments and concerns. I am not sure if they are still around, but there was an east side coalition with good intentions to do good things on the east side. And there is a facebook post that called my eastside indy with many old members of the eastside who voice concerns about the east side of the city. We need to come together and not just complain and moan, but come up with actual concrete solutions, because what Dal said is very very true- the eastside could be a goldmine in the right hands. But if anyone is going damn, and change things, it is us eastside residents

  4. Please go back re-read your economics text book and the fine print on the February 2014 CBO report. A minimum wage increase has never resulted in a net job loss...

  5. The GOP at the Statehouse is more interested in PR to keep their majority, than using it to get anything good actually done. The State continues its downward spiral.

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