Simon Property Group SPG recently announced that it has taken over 100% of The Mall Luxury Outlets entities from Kering. Established in 2001, The Mall operates two luxury outlets: one in Leccio, near Florence, Italy, and the other in Sanremo on the Italian Riviera.

The move will boost Simon’s portfolio, enhance the vibrant collective offerings, attract more shoppers and contribute to long-term growth. Kering received net proceeds of €350 million from the above disposition, which will aid in consolidating its portfolio and concentrating on its core operations.

Simon has been restructuring its portfolio, aiming at premium acquisitions and transformative redevelopments. This retail REIT’s focus on supporting omnichannel retailing and developing mixed-use assets is encouraging. The latest acquisition is also in line with such efforts and boosts its portfolio quality.

Recently, Simon announced its plan to develop a luxury shopping and lifestyle destination in Nashville, TN, the construction of which is set to begin in 2026. Spanning 325,000 square feet, Nashville Premium Outlets will have 75 best-in-class retailers, restaurants and a hotel. This may further include residential options, big-box retailers and more. This development showcases Simon’s strategy for growth, highlighting its efforts to expand its reach and scale.

Simon is slated to report fourth-quarter 2024 results on Feb. 4, after market close. While the company’s quarterly results are likely to display a year-over-year rise in revenues, funds from operations (AFFO) per share are expected to decline.

Over the past six months, shares of this Zacks Rank #3 (Hold) company have risen 14.6%, outperforming the industry’s growth of 3.8%.

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Stocks to Consider

Some better-ranked stocks from the retail REIT sector are Regency Centers REG and Phillips Edison & Company PECO, each currently carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Regency Centers’ 2024 FFO per share is pegged at $4.28, suggesting year-over-year growth of 3.1%.

The Zacks Consensus Estimate for Phillips Edison & Company’s 2024 FFO per share stands at $2.42, indicating an increase of 3.4% from the year-ago reported figure.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.

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