Q3 2024 Simon Property Group Inc Earnings Call Transcript
Key Points
- Simon Property Group Inc (SPG) reported a 4.8% growth in real estate FFO per share, reaching $3.05 compared to $2.91 in the prior year.
- The company achieved a high occupancy rate of 96.2% for malls and outlets, with the Mills occupancy at 98.6%.
- Leasing momentum is strong, with approximately 1,200 leases signed for 4 million square feet in the third quarter.
- Simon Property Group Inc (SPG) increased its dividend to $2.10 per share, marking a 10.5% year-over-year increase.
- The company has a robust development and redevelopment pipeline, with projects underway both domestically and internationally, valued at $1.3 billion at a blended yield of 8%.
- Funds from operations decreased to $1.07 billion or $2.84 per share from $1.2 billion or $3.20 per share last year.
- The company experienced a non-cash net loss of $0.13 per share due to fair value adjustments on Klepierre exchangeable bonds.
- Operational performance at SPARC brands underperformed due to reduced discretionary spending by lower-income consumers.
- The occupancy cost at the end of the quarter was 12.8%, indicating potential pressure on profitability.
- Simon Property Group Inc (SPG) faces challenges with inflationary impacts and high construction costs, which have increased by 60% from pre-pandemic levels.
Greetings and welcome to the Simon Property Group third quarter, 2024 earnings conference call. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Tom Ward, Senior Vice President of Investor Relations. Thank you, Tom. You may begin.
Thank you, Paul. Good morning and thank you for joining us today. Presenting on today's call are David Simon, Chairman, Chief Executive Officer and President and Brian McDade, Chief Financial Officer.
A quick reminder that statements made during this call may be deemed forward-looking statements within the meaning of the safe harbor of the private Securities Litigation Reform Act of 1,995. And actual results may differ materially due to a variety of risks uncertainties and other factors. We refer you to today's press release and our SEC filings for a detailed discussion of the risk factors relating to those forward-looking statements.
Please note that this call
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