What: Simon Property Group surprised many analysts when it decided to acquire and operate brands since the beginning of the pandemic

Why it is important: A landlord becoming a retailer is not unusual: in the department stores world, NK in Sweden is one of the most recent examples. However, SPG is raising the model to an unprecedented scale.

Simon Property Group has invested recently in J.C. Penney, Authentic Brands Group (Brooks Brothers, Aéropostale, Lucky Brand, Forever 21…). David Simon, the chairman, reports that this is still a small and high profile part of a business otherwise based on real estate.

He stressed that these investments have already paid for themselves. He remains confident that the high-income customer is in good shape, and they want to be in brick-and-mortar stores.

SPG second-quarter net income has slipped from $617m in 2021 to $497m 2022, and occupancy rates rose from 91,8% to 93,9%, with 2,200 leases representing 700,000 sqm signed during the first half of 2022.

Retail pays off for Simon Property Group (WWD)