Simon Properties Posts 2Q Profit; Rents, Occupancy Up . Simon Property Group Inc. (SPG) posted a second-quarter profit after a prior-year write-down, with the nation's biggest shopping mall owner seeing revenue growth as occupancies and average rents improved.
Although real-estate investment trusts in general have been hit hard, and shopping-mall trusts have been grappling with weak consumer spending, Simon is viewed as one of the healthiest and has an interest in more than 300 properties. The company in April said its tenants had reported 6.6% sales growth during the first quarter from a year earlier. The increase was 3.9% in the second quarter.
Simon reported a profit of $153.2 million, or 52 cents a share, compared with a prior-year loss of $14.2 million, or 8 cents a share, a year earlier, which included 43 cents of investment write-downs. Funds from operations--a key profit measure for REITs--rose to $1.38 a share from 96 cents as revenue rose 3.3% to $933.6 million.
Analysts polled by Thomson Reuters had most recently forecast earnings of 46 cents and FFO of $1.34 on $917 million in revenue.
Combined occupancy at the company's U.S. regional malls and premium outlets rose to 93.1% from 92.3% a year earlier as average rents edged up 0.3%.
Simon in May dropped its much-publicized pursuit of second-biggest mall owner General Growth Properties Inc. (GGP), after General Growth rebuffed its $33.5 million offer in favor of a recapitalization plan led by Brookfield Asset Management Inc. (BAM).
Shares of Simon, which affirmed its 2010 FFO guidance, closed at $87.93 Thursday and were inactive premarket. The stock had risen 57% in the past year through Thursday.
-By Nathan Becker and Tess Stynes, Dow Jones Newswires; 212-416-2855; [email protected]; .
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