Simon Property Group Q4 2025 Simon Property Group Inc Earnings Call | AllMind AI Earnings | AllMind AI
Q4 2025 Simon Property Group Inc Earnings Call
Operator: Greetings. Welcome to Simon Property Group's Fourth Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star and the number 0 on your telephone keypad. Please note, this conference is being recorded. I will now turn the conference over to Tom Ward, Senior Vice President of Investor Relations. Thank you. You may begin.
Speaker #1: If anyone should require operator assistance during the conference, please press star and the number zero on your telephone keypad. Please note this conference is being recorded.
Speaker #1: I will now turn the conference over to Tom Ward, Senior Vice President of Investor Relations. Thank you. You may proceed.
Speaker #1: begin. Thank you,
Tom Ward: Thank you, Vaughn, and thank you all for joining us this evening. Presenting on today's call are David Simon, Chairman, Chief Executive Officer, and President, Eli Simon, Chief Operating Officer, and Brian McDade, Chief Financial Officer.
Speaker #2: Vaughn. And thank you all for joining us this evening. Presenting on today's call are David Simon, Chairman, Chief Executive Officer, and President; Eli Simon, Chief Operating Officer; and Brian McDade, Chief Financial Officer.
Speaker #2: 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 1995.
David Brown: 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 1995, 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 includes information that may be accurate only as of today's date. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures are included within the press release and the supplemental information in today's Form 8-K filing. Both the press release and the supplemental information are available on our IR website at investors.simon.com. Our conference call this evening will be limited to one hour.
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 1995, 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.
Speaker #2: 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 includes information that may be accurate only as of today's date. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures are included within the press release and the supplemental information in today's Form 8-K filing. Both the press release and the supplemental information are available on our IR website at investors.simon.com. Our conference call this evening will be limited to one hour.
Speaker #2: Please note that this call includes information that may be accurate only as of today's date. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures are included within the press release and the supplemental information in today's Form 8-K filing.
Speaker #2: Both the press release and the supplemental information are available on our IR website at investors.simon.com. Our conference call this evening will be limited to one hour.
Speaker #2: For those who would like to participate in the question-and-answer session, we ask that you please respect our request to limit yourself to one question.
David Brown: For those who would like to participate in the question-and-answer session, we ask that you please respect our request to limit yourself to one question. And please introduce David Simon. Good evening. We delivered strong financial and operational results in the fourth quarter, capping another impressive year for our company. We achieved excellent leasing performance, acquired $2 billion high-quality retail properties, completed more than 20 major redevelopment projects, and opened a new premium outlet in Indonesia. We reported record real estate funds from operations of $4.8 billion, or $12.73 per share. Our results reflect solid fundamentals, strong occupancy, accelerating shopper traffic growth, healthy and growing retail sales, positive supply and demand dynamics, all driving improvement in our cash flow. We returned approximately $3.5 billion in cash to our shareholders through common stock repurchases and record cash dividends.
For those who would like to participate in the question-and-answer session, we ask that you please respect our request to limit yourself to one question. And please introduce David Simon.
Speaker #2: And please
Speaker #2: introduce David Simon. Good
David Simon: Good evening. We delivered strong financial and operational results in the fourth quarter, capping another impressive year for our company. We achieved excellent leasing performance, acquired $2 billion high-quality retail properties, completed more than 20 major redevelopment projects, and opened a new premium outlet in Indonesia. We reported record real estate funds from operations of $4.8 billion, or $12.73 per share.
Speaker #3: Good evening. We delivered strong financial and operational results in the fourth quarter, capping another impressive year for our company. We achieved excellent leasing performance, acquired $2 billion of high-quality retail properties, completed more than 20 major redevelopment projects, and opened a new premium outlet in Indonesia.
Speaker #3: We reported record real estate funds from operations of $4.8 billion, or $12.73 per share. Our results reflect solid fundamentals, strong occupancy, shopper traffic growth, accelerating, healthy and growing retail sales, and positive supply and demand dynamics—all driving improvement in our cash flow.
Our results reflect solid fundamentals, strong occupancy, accelerating shopper traffic growth, healthy and growing retail sales, positive supply and demand dynamics, all driving improvement in our cash flow. We returned approximately $3.5 billion in cash to our shareholders through common stock repurchases and record cash dividends.
Speaker #3: We return approximately $3.5 billion in cash to our shareholders through common stock repurchases and record cash dividends. In our yearly tally, we have now paid approximately $48 billion in cash to shareholders in dividends over our history as a public company.
David Brown: In our yearly tally, we have now paid approximately $48 billion in cash to shareholders in dividends over our history as a public company. With that, I'm now going to turn it over to Eli. We'll discuss our leasing and investment activities, and then Brian will cover our fourth quarter results and our outlook for next year in more detail. Thank you. During 2025, we acquired The Mall, two well-known luxury outlet centers in Italy; our partner's interest in Brickell City Centre, a premier mixed-use property in Miami's rapidly growing Central Business District; the remaining 12% interest in Taubman Realty Group, we did not previously own; and Phillips Place, a high-productivity open-air retail center in Charlotte, a market we know well with significant upside from remerchandising and densification.
In our yearly tally, we have now paid approximately $48 billion in cash to shareholders in dividends over our history as a public company. With that, I'm now going to turn it over to Eli. We'll discuss our leasing and investment activities, and then Brian will cover our fourth quarter results and our outlook for next year in more detail.
Speaker #3: With that, I'm now going to turn it over to Eli. We'll discuss our leasing and investment activities, and then Brian will cover our fourth quarter results and our outlook for next year.
Speaker #3: In more detail.
Eli Simon: Thank you. During 2025, we acquired The Mall, two well-known luxury outlet centers in Italy; our partner's interest in Brickell City Centre, a premier mixed-use property in Miami's rapidly growing Central Business District; the remaining 12% interest in Taubman Realty Group, we did not previously own; and Phillips Place, a high-productivity open-air retail center in Charlotte, a market we know well with significant upside from remerchandising and densification.
Speaker #3: During 2025, we acquired The Mall, two well-known luxury outlet centers in Italy, our partners' interest in Brickell City Centre, a premier mixed-use property in Miami's rapidly growing central business district, the remaining 12% interest in Talbot Realty Group we did not previously own, and Phillips Place, a high-productivity open-air retail center in Charlotte—a market we know well, with significant upside from re-merchandising and densification.
Speaker #3: These deals enhance the quality of our portfolio, and we look forward to deploying our leasing and property management expertise, along with our strong balance sheet, to pursue new growth and value creation opportunities across these properties.
David Brown: These deals enhance the quality of our portfolio, and we look forward to deploying our leasing and property management expertise along with our strong balance sheet to pursue new growth and value creation opportunities across these properties. Retailer demand remains strong across our portfolio. We signed more than 1,300 leases, totaling over 4.4 million sq ft during the quarter, and over 4,600 leases for more than 17 million sq ft for the year. Approximately 30% of our annual volume was new deals, reflecting continued strong demand across our portfolio. Now turning to development. We completed more than 20 significant redevelopment projects in 2025, including retail and experiential additions at Southdale Center, Stanford Shopping Center, King of Prussia, and the Forum Shops at Caesars, and mixed-use additions including hotel and residential at Northgate Station and Lakeline Mall, respectively.
These deals enhance the quality of our portfolio, and we look forward to deploying our leasing and property management expertise along with our strong balance sheet to pursue new growth and value creation opportunities across these properties. Retailer demand remains strong across our portfolio. We signed more than 1,300 leases, totaling over 4.4 million sq ft during the quarter, and over 4,600 leases for more than 17 million sq ft for the year.
Speaker #3: Retailer demand remains strong across our portfolio. We signed more than 1,300 leases totaling over 4.4 million square feet during the quarter, and over 4,600 leases for more than 17 million square feet for the year.
Approximately 30% of our annual volume was new deals, reflecting continued strong demand across our portfolio. Now turning to development. We completed more than 20 significant redevelopment projects in 2025, including retail and experiential additions at Southdale Center, Stanford Shopping Center, King of Prussia, and the Forum Shops at Caesars, and mixed-use additions including hotel and residential at Northgate Station and Lakeline Mall, respectively.
Speaker #3: Approximately 30% of our annual volume was new deals, reflecting continued strong demand across our portfolio. Now turning to development. We completed more than 20 significant redevelopment projects in 2025, including retail and experiential additions at Southdale Center, Stanford Shopping Center, King of Prussia, and The Forum Shops at Caesars, and mixed-use additions including hotel and residential at Northgate Station and Lakeline Mall, respectively.
Speaker #3: In 2026, notable retail and mixed-use projects scheduled to come online include Brea Mall; Northgate Station, first phase of residential; and open-air expansion with restaurants and retail at The Shops at Mission Viejo. Briarwood Mall will feature a new Harvest Market, Dick's Sporting Goods, and residential. At Tacoma Mall, there will be new Village shops and restaurants.
David Brown: In 2026, notable retail and mixed-use projects scheduled to come online include Brea Mall, Northgate Station first phase of residential, an open-air expansion with restaurants and retail at the Shops at Mission Viejo, Briarwood Mall with the new Harvest Market, Dick's Sporting Goods, and residential, and at Tacoma Mall, new Village Shops and Restaurants. We also expect to begin construction on exciting new projects, including anchor redevelopments at The Fashion Mall at Keystone and Town Center at Boca Raton, expansions at Toronto, Desert Hills, and Woodbury Common pre-leasing are progressing, and Sagefield, our new open-air retail and mixed-use development in Nashville. We also plan to enhance the merchandise mix and invest meaningful capital upgrades at former TRG assets, including The Mall at Green Hills, International Plaza, and Cherry Creek Shopping Center.
In 2026, notable retail and mixed-use projects scheduled to come online include Brea Mall, Northgate Station first phase of residential, an open-air expansion with restaurants and retail at the Shops at Mission Viejo, Briarwood Mall with the new Harvest Market, Dick's Sporting Goods, and residential, and at Tacoma Mall, new Village Shops and Restaurants.
We also expect to begin construction on exciting new projects, including anchor redevelopments at The Fashion Mall at Keystone and Town Center at Boca Raton, expansions at Toronto, Desert Hills, and Woodbury Common pre-leasing are progressing, and Sagefield, our new open-air retail and mixed-use development in Nashville. We also plan to enhance the merchandise mix and invest meaningful capital upgrades at former TRG assets, including The Mall at Green Hills, International Plaza, and Cherry Creek Shopping Center.
Speaker #3: We also expect to begin construction on exciting new projects, including anchor redevelopments at Fashion Mall at Keystone and Town Center at Boca Raton. Expansions at Toronto, Desert Hills, and Woodbury Common Premium Outlets are progressing, and Sagefield—our new open-air retail and mixed-use development in Nashville.
Speaker #3: We also plan to enhance the merchandise mix and invest meaningful capital upgrades at former TRG assets, including The Mall at Greenhills, International Plaza, and Cherry Creek Shopping Center.
Speaker #3: At year-end, our share of the net cost of developments across all platforms totaled approximately $1.5 billion, with a blended yield of 9%. Approximately 45% of net costs are for mixed-use projects.
David Brown: At year-end, our share of the net cost of developments across all platforms totaled approximately $1.5 billion, with a blended yield of 9%. Approximately 45% of net costs are for mixed-use projects. Our pipeline of new development and redevelopment opportunities continues to grow and now exceeds $4 billion. I will now turn it over to Brian, who will walk through our fourth quarter results. Thank you, Eli. Real estate FFO was $3.49 per share in the fourth quarter compared to $3.35 in the prior year, 4.2% growth. Domestic and international operations both performed well, contributing $0.26 of growth driven by a higher lease income across the business. As anticipated, lower interest income and higher interest expense combined were a $0.07 drag in the quarter. Domestic property NOI growth was strong and increased 4.8% year-over-year for the quarter and 4.4% for the year.
At year-end, our share of the net cost of developments across all platforms totaled approximately $1.5 billion, with a blended yield of 9%. Approximately 45% of net costs are for mixed-use projects. Our pipeline of new development and redevelopment opportunities continues to grow and now exceeds $4 billion. I will now turn it over to Brian, who will walk through our fourth quarter results.
Speaker #3: Our pipeline of new development and redevelopment opportunities continues to grow and now exceeds $4 billion. I will now turn it over to Brian, who will walk through our fourth quarter results.
Brian McDade: Thank you, Eli. Real estate FFO was $3.49 per share in the fourth quarter compared to $3.35 in the prior year, 4.2% growth. Domestic and international operations both performed well, contributing $0.26 of growth driven by a higher lease income across the business. As anticipated, lower interest income and higher interest expense combined were a $0.07 drag in the quarter. Domestic property NOI growth was strong and increased 4.8% year-over-year for the quarter and 4.4% for the year.
Speaker #1: Thank you, Eli. Real estate FFO was $3.49 per share in the fourth quarter, compared to $3.35 in the prior year, a 4.2% growth. Domestic operations contributed $0.26, and international operations both performed well, with growth driven by a higher business.
Speaker #1: As anticipated, lower interest lease income across the income and higher interest expense combined were a $0.07 drag in the quarter. Domestic property and aligned growth was strong and increased 4.8% year over year for the quarter and 4.4% for the year.
Speaker #1: Portfolio NOI, which includes our international properties at constant currency, grew 5.1% for the quarter and 4.7% for the year. Malls and Premium Outlets ended the year at 96.4% occupancy, and The Mills ended at 99.2%.
David Brown: Portfolio NOI, which includes our international properties at constant currency, grew 5.1% for the quarter and 4.7% for the year. Malls and premium outlets ended the year at 96.4% occupancy, and the mills ended at 99.2%. The addition of the TRG assets reduced occupancy by 20 basis points for malls and premium outlets and 30 basis points for the mills. We expect to drive higher occupancy at these assets as we execute on our leasing strategy. Average base minimum rents increased 4.7% year-over-year for the malls and the premium outlets. The TRG properties contributed approximately 250 basis points to this growth. Retailer sales per square foot for the malls and the premium outlets were $799 per square foot a year. The SPG-only portfolio was up 2% year-over-year. Importantly, total sales volumes grew approximately 4% in the important fourth quarter and 3% for the full year.
Portfolio NOI, which includes our international properties at constant currency, grew 5.1% for the quarter and 4.7% for the year. Malls and premium outlets ended the year at 96.4% occupancy, and the mills ended at 99.2%. The addition of the TRG assets reduced occupancy by 20 basis points for malls and premium outlets and 30 basis points for the mills. We expect to drive higher occupancy at these assets as we execute on our leasing strategy.
Speaker #1: TRG assets reduced occupancy by 20 basis points for malls and premium outlets, and 30 basis points for the Mills. We expect to drive higher occupancy with our leasing strategy.
Speaker #1: TRG assets reduced occupancy by 20 basis points for malls and premium outlets and 30 basis points for The Mills. We expect to drive higher occupancy at these assets. Average base minimum rents increased at these assets as we execute, up 4.7% year over year for the malls and the premium outlets.
Average base minimum rents increased 4.7% year-over-year for the malls and the premium outlets. The TRG properties contributed approximately 250 basis points to this growth. Retailer sales per square foot for the malls and the premium outlets were $799 per square foot a year. The SPG-only portfolio was up 2% year-over-year. Importantly, total sales volumes grew approximately 4% in the important fourth quarter and 3% for the full year.
Speaker #1: Approximately $250. The TRG properties contributed basis points to this growth. Retailer sales per square foot for the malls and the premium outlets were $799 per square foot per year.
Speaker #1: The SPG-only portfolio was up 2% year over year. Volumes grew approximately 4% in the important fourth quarter and 3% for the full year. Occupancy cost year.
David Brown: Occupancy cost at the end of the year was 12.7%. Turning to the balance sheet, during 2025, we completed approximately $9 billion in financing activities, including a dual-tranche US Senior Notes offering that totaled $1.5 billion at a combined average term of 7.8 years and a weighted average coupon rate of 1.77%, and also completed $7 billion of secured loan refinancings and extensions in the year. Subsequent to year-end, we concluded an $800 million offering of five-year notes at a spread of 65 basis points per five-year treasury. We used the proceeds to repay $800 million of notes that matured on 15 January 2026. Our A-rated balance sheet provided a distinct advantage with more than $9 billion of liquidity at year-end and a net debt to EBITDA measure of 5.0x.
Occupancy cost at the end of the year was 12.7%. Turning to the balance sheet, during 2025, we completed approximately $9 billion in financing activities, including a dual-tranche US Senior Notes offering that totaled $1.5 billion at a combined average term of 7.8 years and a weighted average coupon rate of 1.77%, and also completed $7 billion of secured loan refinancings and extensions in the year.
Speaker #1: At the end of the year, it was 12.7%. Turning to the balance sheet, importantly, total sales included $9 billion in financing activities, including a dual tranche US senior notes offering that totaled $1.5 billion at a combined average term of 7.8 years and a weighted average coupon rate. We also completed $7 billion of secured loan refinancing and extensions in the year.
Subsequent to year-end, we concluded an $800 million offering of five-year notes at a spread of 65 basis points per five-year treasury. We used the proceeds to repay $800 million of notes that matured on 15 January 2026. Our A-rated balance sheet provided a distinct advantage with more than $9 billion of liquidity at year-end and a net debt to EBITDA measure of 5.0x.
Speaker #1: Subsequent to year-end, we completed five-year notes at a spread of 65 basis points over the five-year Treasury. We used the proceeds to repay $800 million of notes that matured on January 15, 2026.
Speaker #1: A distinct advantage with our A-rated balance sheet provides more than $9 billion of liquidity at year-end and a net debt-to-EBITDA measure of 5.0. In 2025, we paid more than times.
David Brown: During 2025, we paid more than $3.2 billion in common stock dividends and repurchased over 1.2 million shares for approximately $227 million. Subsequent to year-end, we repurchased an additional 273,000 shares for $50 million. Today, we announced our dividend of $2.20 per share for the first quarter, a year-over-year increase of $0.10 or 4.8%. The dividend is payable on 31 March 2026. Turning to our '26 guidance, we expect real estate FFOs of $13 to $13.25 per share, with a midpoint of $13.13. The guidance range assumes domestic property NOI growth of at least 3% and higher net interest expense of $0.25 to $0.30 per share versus 2025, reflecting current market interest rate conditions. Thank you. We will now open it up for questions. Thank you. We will now be conducting a question-and-answer session. As a reminder, we ask that you please limit yourselves to one question.
During 2025, we paid more than $3.2 billion in common stock dividends and repurchased over 1.2 million shares for approximately $227 million. Subsequent to year-end, we repurchased an additional 273,000 shares for $50 million. Today, we announced our dividend of $2.20 per share for the first quarter, a year-over-year increase of $0.10 or 4.8%. The dividend is payable on 31 March 2026. Turning to our '26 guidance, we expect real estate FFOs of $13 to $13.25 per share, with a midpoint of $13.13.
Speaker #1: $3.2 billion in common stock dividends and repurchased over 1.2 million shares for approximately $227 million. During year-end, we repurchased an additional 273,000 shares for $50 million.
Speaker #1: Subsequent to that, and today, we announced our dividends of $2.20 per share for the first quarter, a year-over-year increase of $0.10, or 4.8%.
Speaker #1: March 31. Turning to the dividend, it is payable on to our 26 guidance. We expect real estate FFOs of $13.00 to $13.25 per share, with a midpoint of $13.13.
The guidance range assumes domestic property NOI growth of at least 3% and higher net interest expense of $0.25 to $0.30 per share versus 2025, reflecting current market interest rate conditions. Thank you. We will now open it up for questions.
Speaker #1: The guidance range assumes domestic property NOI growth of at least 3% and higher net interest expense of $0.25 to $0.30 per share versus 2025, reflecting current market and interest rate conditions.
Speaker #1: Thank you. We will now open it up for questions.
Operator: Thank you. We will now be conducting a question-and-answer session. As a reminder, we ask that you please limit yourselves to one question.If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue.
Speaker #2: Thank you. We will now be conducting a question and answer session. As a reminder, we ask that you please limit yourselves to one question.
Speaker #2: If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue.
David Brown: If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question comes from Caitlin Burrows with Goldman Sachs. You may proceed with your question. Hi, everyone. Good evening. Maybe on the leasing side, you mentioned that 30% of lease signings last year were on new leases. So could you give some detail on what rents you're getting on new leases and renewal leases and how your pipeline today, and depth of demand, compares to a year ago, I guess, while keeping in mind the TRG deal and now the portfolio is larger? Hi, Caitlin.
Speaker #2: You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.
For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question comes from Caitlin Burrows with Goldman Sachs. You may proceed with your question.
Speaker #2: Our first question comes from Caitlin Burrows with Goldman Sachs. You may proceed with your question.
Caitlin Burrows: Hi, everyone. Good evening. Maybe on the leasing side, you mentioned that 30% of lease signings last year were on new leases. So could you give some detail on what rents you're getting on new leases and renewal leases and how your pipeline today, and depth of demand, compares to a year ago, I guess, while keeping in mind the TRG deal and now the portfolio is larger?
Speaker #3: Hi, everyone. Good evening. Maybe on the leasing side—you mentioned that 30% of lease signings last year were on new leases. So could you give some detail on what rents you're getting on new leases and renewal leases, and how your pipeline today and depth of demand compare to a year ago?
Speaker #3: I guess, while keeping in mind the TRG deal, and now the portfolio is—
Speaker #3: larger. Hi,
Brian McDade: Hi, Caitlin.
Speaker #1: Caitlin, this is Brian. Look, I think what we would say to that is, certainly, 30% is a good run rate for new leasing. We disclosed the new rents on our leases, which are approximately $65 per square foot.
David Brown: This is Brian. Look, I think what we would say to that is certainly 30% is a good run rate for new leasing. We disclose the new rents on our leases, which are approximately $65 per sq ft. We would expect that to continue into 2026. And then just from the pipeline perspective, year to date, our pipeline is up about 15% over last year. And that's really broad-based across all categories, so no change in tenant demand. If anything, it's increasing. Thanks. Our next question comes from Samir Khanal with Bank of America. You may proceed with your question. Good evening, everybody. I guess David or Eli, going back to November, you launched the Simon Plus loyalty program. Is there any early observations you can share about the program?
Brian McDade: This is Brian. Look, I think what we would say to that is certainly 30% is a good run rate for new leasing. We disclose the new rents on our leases, which are approximately $65 per sq ft. We would expect that to continue into 2026. And then just from the pipeline perspective, year to date, our pipeline is up about 15% over last year. And that's really broad-based across all categories, so no change in tenant demand. If anything, it's increasing.
Speaker #1: We would expect that to
Speaker #1: continue. Into
Speaker #2: 2026? And then, just from the pipeline perspective, year to date, our pipeline is up about 15% over last year. And that's really broad-based across all categories.
Speaker #2: So, no change in tenant demand; if anything, it's increasing.
Caitlin Burrows: Thanks.
Operator: Our next question comes from Samir Khanal with Bank of America. You may proceed with your question.
Speaker #2: Our next question comes, thanks, from Samir Kanal with Bank of America. You may proceed with your question.
Samir Khanal: Good evening, everybody. I guess David or Eli, going back to November, you launched the Simon Plus loyalty program. Is there any early observations you can share about the program?
Speaker #4: Good evening, everybody. I guess, David or Eli, going back to November, you launched the Simon Plus loyalty program. Are there any early observations you can share about the program?
Speaker #4: I mean, as it relates to maybe the impact on traffic or retailer sales—maybe, Eli, anything would be helpful from that end. Thanks.
David Brown: I mean, as it relates to maybe the impact on traffic or retailer sales, maybe Eli, anything would be helpful from that end. Thanks. Yeah, sure. So it's obviously early days, but we've been very pleased with the adoption from both a customer perspective but also getting brand excited about it. And so we're still in the membership acquisition phase, increasing engagement. We had a great holiday activation that got a lot of organic buzz, which was exciting and I think helped increase traffic a bit. And so as we go into 2026, it's more of the same: continue to focus on getting new rewards, new retailers, and then also partnering with other loyalty programs that are outside of our space as well, working on launching that in the beginning part of this year. And so again, early days, but we are very pleased with where we are so far.
I mean, as it relates to maybe the impact on traffic or retailer sales, maybe Eli, anything would be helpful from that end. Thanks.
Eli Simon: Yeah, sure. So it's obviously early days, but we've been very pleased with the adoption from both a customer perspective but also getting brand excited about it. And so we're still in the membership acquisition phase, increasing engagement. We had a great holiday activation that got a lot of organic buzz, which was exciting and I think helped increase traffic a bit.
Speaker #1: Yeah, sure. So, it's obviously early days, but we've been very pleased with the adoption from both a customer perspective, but also getting brands excited about it.
Speaker #1: And so we're still in the membership acquisition phase, increasing engagement. We had a great holiday activation that got a lot of organic buzz, which was exciting.
Speaker #1: And I think it helped increase traffic a bit. And so, as we go into '26, it's more of the same—continuing to focus on getting new rewards, new retailers, and then also partnering with other loyalty programs that are outside of our space as well. We're working on launching that in the beginning part of this year.
And so as we go into 2026, it's more of the same: continue to focus on getting new rewards, new retailers, and then also partnering with other loyalty programs that are outside of our space as well, working on launching that in the beginning part of this year. And so again, early days, but we are very pleased with where we are so far.
Speaker #1: And so, again, early days, but we are very pleased with where we are so far.
David Brown: The next question comes from the line of Michael Griffin with Evercore ISI. Please proceed with your question. Great. Thanks. Appreciate all the color so far. Just wondering if you can give some insights maybe into your thoughts around tenant credit or bad debt as it looks at the year ahead. I know there's been some news recently around retailer bankruptcies, but just maybe give us a sense where your head is at from expectations from a tenant credit perspective. Is it better, worse, the same than last year? Anything about that would be helpful. Thank you. Sure. Yeah. Look, I think the tariffs are clearly having an effect on retailers. So it is definitely putting more pressure on them. And it's not the big guys. I think I mentioned to you this on our last call.
Operator: The next question comes from the line of Michael Griffin with Evercore ISI. Please proceed with your question.
Speaker #2: Michael Griffin with Evercore ISI. Please proceed with your question.
Speaker #2: question. Great.
Michael Griffin: Great. Thanks. Appreciate all the color so far. Just wondering if you can give some insights maybe into your thoughts around tenant credit or bad debt as it looks at the year ahead. I know there's been some news recently around retailer bankruptcies, but just maybe give us a sense where your head is at from expectations from a tenant credit perspective. Is it better, worse, the same than last year? Anything about that would be helpful. Thank you.
Speaker #5: Thanks. Appreciate all the color so far. You can give some insights maybe into your—just wondering if—thoughts around tenant credit or bad debt as it looks at the year ahead.
Speaker #5: I know there's been some—you know, your head is at from expectations, bankruptcies—but just maybe give us a sense: where are we? The same as last year?
Speaker #5: From a tenant credit perspective, is— Thank you.
Speaker #5: Anything about that would be helpful. Look, I think—
David Simon: Sure. Yeah. Look, I think the tariffs are clearly having an effect on retailers. So it is definitely putting more pressure on them. And it's not the big guys. I think I mentioned to you this on our last call.
Speaker #1: Sure. Tariffs are clearly, yeah, having an effect on retailers. So it is definitely putting more pressure on them. And it's not the big guys.
Speaker #1: I think I mentioned this to you on our last call. I mean, really, you put Costco and Walmart and Amazon aside, and then you have the rest of us, okay?
David Brown: I mean, it's really you put Costco and Walmart and, of course, Amazon aside, and then you have the rest of us, okay? And the rest of us are feeling the pinch. And so it's something that when we had our call last year, obviously, we weren't dealing with. Retailers dealt with it successfully this year, but kind of the full impact will really be 2026 because it was implemented, who knows, in April, I guess. We're still waiting for the Supreme Court to rule, which could be a small victory for our clients, but no one really knows. I don't know what Polymarket, where the odds are. Actually, that'd be an interesting time. While we're waiting here, you can find out what Polymarket says about the Supreme Court. So they have to deal with it, and we see it from a catalyst point of view.
I mean, it's really you put Costco and Walmart and, of course, Amazon aside, and then you have the rest of us, okay? And the rest of us are feeling the pinch. And so it's something that when we had our call last year, obviously, we weren't dealing with. Retailers dealt with it successfully this year, but kind of the full impact will really be 2026 because it was implemented, who knows, in April, I guess.
Speaker #1: And the rest of us are feeling the pinch, and so it's something that, when we had our call last year, obviously we weren't dealing with.
Speaker #1: We successfully this year, but it kind of retailers dealt with it. The full impact will really be '26, because it was implemented, who knows, in April, I guess.
We're still waiting for the Supreme Court to rule, which could be a small victory for our clients, but no one really knows. I don't know what Polymarket, where the odds are. Actually, that'd be an interesting time. While we're waiting here, you can find out what Polymarket says about the Supreme Court. So they have to deal with it, and we see it from a catalyst point of view.
Speaker #1: We're still waiting for the Supreme Court to rule, which could be for our clients. But no one really knows—a small victory, maybe. I don't know what Polymarket, where the odds are.
Speaker #1: Actually, that'd be an interesting time. While we're warbling here, you can find out what Polymarket says about the Supreme Court. So they have to deal with it, and, catalyst point of view, and I mean, it's going to take a couple of hundred million dollars—if we see it—from Catalyst to pay the government.
David Brown: I mean, it's going to take a couple hundred million dollars of EBITDA away from Catalyst to pay the government. I mean, if you cut through it all, because I think Catalyst, rightfully so, is very focused on doing the best they can not to pass it on to the consumer. So it is a real issue, and the retailers that we speak to are managing it the best they can. But it is a headwind. Long story short, it's probably put more pressure on retailers than should be, and it's going to end up hurting the small guys. So we're a little more cautious. We gave you our range. That was frankly; we didn't have some bankruptcies in there that surfaced at the beginning of 2026 that we felt comfortable enough to keep the range. We do our budgets. We finish basically at mid-December.
I mean, it's going to take a couple hundred million dollars of EBITDA away from Catalyst to pay the government. I mean, if you cut through it all, because I think Catalyst, rightfully so, is very focused on doing the best they can not to pass it on to the consumer. So it is a real issue, and the retailers that we speak to are managing it the best they can. But it is a headwind.
Speaker #1: I mean, if you cut through it, EBITDA, away all—rightfully so—is very focused on doing the best they can not to pass it on to the consumer.
Speaker #1: So it is a reel issue. retailers that we speak And the to are managing it the is a headwind, best they can. But it retailers than should and long story short, it's be and it's going to end probably put more pressure up hurting the small guys.
Long story short, it's probably put more pressure on retailers than should be, and it's going to end up hurting the small guys. So we're a little more cautious. We gave you our range. That was frankly; we didn't have some bankruptcies in there that surfaced at the beginning of 2026 that we felt comfortable enough to keep the range. We do our budgets. We finish basically at mid-December.
Speaker #1: So we’re a little more cautious. We gave you our range that was, frankly, we didn’t have some bankruptcies in there that surfaced at the beginning of ’26. We felt comfortable enough to keep basically the range we do our mid-December.
Speaker #1: Budgets, we finish. So that budget was essentially fixed. You had all the retail demand. We didn't back off it, but they'll bid more, and I would probably be a little—say most of it, if I had to cut to the chase, is tariff pressure.
David Brown: So that budget was essentially fixed. We didn't back off it because of what Eli mentioned to you, all the retail demand. But there'll probably be a little bit more, and I would say most of it, if I had to cut to the chase, is tariff pressure, which is unfortunate. I hope that answers your question. Yep. Appreciate it. Thank you. The next question comes from the line of Michael Goldsmith with UBS. You may proceed with your question. Good afternoon. Thanks a lot for taking my question. We heard a lot about investment and redevelopment from Eli. So maybe can you frame how much incremental NOI or FFO we should expect this year from projects stabilizing either late in 2025 or in 2026? Thanks. Hi, Michael. This is Brian.
So that budget was essentially fixed. We didn't back off it because of what Eli mentioned to you, all the retail demand. But there'll probably be a little bit more, and I would say most of it, if I had to cut to the chase, is tariff pressure, which is unfortunate. I hope that answers your question.
Speaker #1: Which is
Speaker #2: Thank you.
Speaker #1: Answers your question.
Speaker #1: Answers your question. unfortunate. Yep.
Michael Griffin: Yep. Appreciate it.
Speaker #2: Appreciate it.
David Simon: Thank you.
Speaker #1: Thank I hope that. you.
Operator: The next question comes from the line of Michael Goldsmith with UBS. You may proceed with your question.
Speaker #2: The next question comes from the line of Michael Goldsmith with UBS. You may proceed with your question.
Speaker #2: question. Good
Michael Goldsmith: Good afternoon. Thanks a lot for taking my question. We heard a lot about investment and redevelopment from Eli. So maybe can you frame how much incremental NOI or FFO we should expect this year from projects stabilizing either late in 2025 or in 2026? Thanks.
Speaker #6: Afternoon. Thanks a lot for taking my question. We’ve heard a lot about investment, and can you frame how much incremental NOI or FFO we should expect this year from projects stabilizing either in 2025 or in 2026?
Speaker #6: Thanks.
Brian McDade: Hi, Michael. This is Brian. I think you should expect about a $30 million contribution in 2026 from projects that are going to be complete.
Speaker #1: Brian, I think you should expect about a $30 million contribution in '26, hi Michael, from projects that are going to be complete.
David Brown: I think you should expect about a $30 million contribution in 2026 from projects that are going to be complete. Great. Thank you very much. The next question comes from the line of Alexander Goldfarb with Piper Sandler. You may proceed with your question. Hey. Good evening. Good evening out there. Polymarket. David. Polymarket. Hey. Hold on. Polymarket. Polymarket says 25% to 32% in favor of policy survivors. Okay. If it does, it's going to be an interesting opinion. David, just going to your point on the question on the guidance set in December, even though that was ahead of Saks and Eddie Bauer, but you still feel pretty good. As you look at the business, you guys have there's Simon Brand Ventures. There's parking revenue. I mean, there's all these other ancillary revenue sources.
Michael Goldsmith: Great. Thank you very much.
Speaker #6: Great. Thank you very much.
Operator: The next question comes from the line of Alexander Goldfarb with Piper Sandler. You may proceed with your question.
Speaker #2: The next question comes from the line of Alexander Goldfarb with Piper Sandler. You may proceed with your question.
Alexander Goldfarb: Hey. Good evening. Good evening out there.
Speaker #7: Hey,
Speaker #7: good evening.
Speaker #7: good evening. Good evening out
David Simon: Polymarket.
Alexander Goldfarb: David.
David Simon: Polymarket.
Alexander Goldfarb: Hey.
David Simon: Hold on. Polymarket. Polymarket says 25% to 32% in favor of policy survivors. Okay.
Speaker #7: David. Hey, hold on. Polymarket.
Speaker #1: Polymarket. there.
Speaker #1: to 32 Polymarket percent in favor of policy. Survival. Okay.
Alexander Goldfarb: If it does, it's going to be an interesting opinion. David, just going to your point on the question on the guidance set in December, even though that was ahead of Saks and Eddie Bauer, but you still feel pretty good. As you look at the business, you guys have there's Simon Brand Ventures. There's parking revenue. I mean, there's all these other ancillary revenue sources.
Speaker #7: If it does, it's going to be an interesting opinion. David, just going to your point on the question on the guidance set in December, even says 25 though that was ahead of Sax and Eddie Bauer, but you still feel pretty good.
Speaker #7: As you look at the business you guys have, there's Simon Brand Ventures, there's parking revenue—I mean, there's all these other ancillary, presumably, revenue sources.
David Brown: So is your view that as presumably the economy grows, all these other revenue levers that you guys have will kick in and be more than sufficient to offset whatever potential tariff disruption that you outlined? Or just how are you thinking about that? Because on one hand, the tariff thing sounds like there's going to be more ripple effects this year as the full year is felt. But at the same token, if presumably the economy accelerates, you guys have more revenue levers that should come into play and help drive earnings up. Yeah. Listen, I agree 1,000% with your thesis. The most important thing is traffic's up. Sales are up. The retailers that don't make it, even though I could sit here and blame tariffs, they're not highly productive retailers. And given that, it's our view that we can replace it with more productive retailers at higher rents.
So is your view that as presumably the economy grows, all these other revenue levers that you guys have will kick in and be more than sufficient to offset whatever potential tariff disruption that you outlined? Or just how are you thinking about that? Because on one hand, the tariff thing sounds like there's going to be more ripple effects this year as the full year is felt. But at the same token, if presumably the economy accelerates, you guys have more revenue levers that should come into play and help drive earnings up.
Speaker #7: As the economy grows, all these other revenue levers that you guys have will kick in and be—so is your view whatever potential tariff disruption that you outlined?
Speaker #7: Or just, how are you thinking about that? Because on one hand, the tariff thing sounds like there are going to be more ripple effects this year as the full token—if, presumably, the economy year is felt—but at the same time, as it accelerates, you guys have more revenue levers that should come into play and help drive earnings up.
David Simon: Yeah. Listen, I agree 1,000% with your thesis. The most important thing is traffic's up. Sales are up. The retailers that don't make it, even though I could sit here and blame tariffs, they're not highly productive retailers. And given that, it's our view that we can replace it with more productive retailers at higher rents.
Speaker #1: Yeah. Listen, I agree 1,000% with you. The thesis—we are seeing the most important thing is traffic's up, sales are up. The retailers that don't make it, even though I could sit here and blame tariff, they're not highly productive retailers.
Speaker #1: And given that, it's our view that we can replace it with more productive retailers and higher rents. And take what's going on at-- at Saks as a simple example.
David Brown: Take what's going on at Saks as a simple example. We have a number of office stores, and it'll be like the Forever 21. Even though we don't have all of Forever 21 leased, we are already way ahead of the income for that, and we have upside of another 20, 30 boxes to lease. So Saks OFF 5TH total was paying us around $18 million. We think half the portfolio will pay us $30 million. And Eli Simon said that. I remember the numbers, right? And then those are deals that we feel highly confident on. And then we have the other boxes that will generate it. So we're not replacing; we're replacing the OFF 5TH in the sets. The productivity and the rents are just so cheap that there's a tremendous amount of upside. And it takes time, right?
Take what's going on at Saks as a simple example. We have a number of office stores, and it'll be like the Forever 21. Even though we don't have all of Forever 21 leased, we are already way ahead of the income for that, and we have upside of another 20, 30 boxes to lease. So Saks OFF 5TH total was paying us around $18 million. We think half the portfolio will pay us $30 million. And Eli Simon said that.
Speaker #1: A number of office stores, and it'll be like the Forever 21. Even though we don't have all of Forever 21 leased, we are already way ahead of the income for that, and we have upside of another 20, 30 boxes to lease.
Speaker #1: So Saks Off Fifth, total, was paying us around $18 million. We think half the portfolio will pay us $30 million, and Eli Shaken said that if I remember the numbers right?
I remember the numbers, right? And then those are deals that we feel highly confident on. And then we have the other boxes that will generate it. So we're not replacing; we're replacing the OFF 5TH in the sets. The productivity and the rents are just so cheap that there's a tremendous amount of upside. And it takes time, right?
Speaker #1: So, and then we'll—and those are deals that we feel highly confident on. And then we have the other boxes that we'll generate. So we're not replacing—we're replacing the Off 5th in the sets.
Speaker #1: The productivity and the rents are just so cheap that there's a tremendous amount of upside. And it takes time, right? But—and most of that will all be back-end weighted because your GOB, sales, and I will be done, who knows, in the spring sometime we get the space back.
David Brown: Most of that will all be back-end weighted because your GOB sales will be done who knows. In the spring sometime, we get the space back. Maybe there's a few that we can get in the Q4, but most of it will show up in 2027. So the media sales, tenant demand, traffic is all moving in the right direction. And I'm like you. I mean, we're bullish on the economy. It's just that the tariffs, it's never going to be all systems go. We still see it a little bit on the sales. We had a good bounce back on the border, the north border. Canadians are really pissed off, so they're not going anywhere in the US. So we're seeing kind of the north border a little weaker than the south border.
Most of that will all be back-end weighted because your GOB sales will be done who knows. In the spring sometime, we get the space back. Maybe there's a few that we can get in the Q4, but most of it will show up in 2027. So the media sales, tenant demand, traffic is all moving in the right direction. And I'm like you. I mean, we're bullish on the economy.
Speaker #1: Maybe there’s a few that we can get in the fourth quarter, but most of it will show up in ’27. So the media sales, tenant demand, traffic—it's all moving in the right direction.
Speaker #1: And I like you. I mean, we're bullish on the economy. It's just that the tariffs—it's never going to be all systems go.
It's just that the tariffs, it's never going to be all systems go. We still see it a little bit on the sales. We had a good bounce back on the border, the north border. Canadians are really pissed off, so they're not going anywhere in the US. So we're seeing kind of the north border a little weaker than the south border.
Speaker #1: We still had a good bounce back on it, a little bit, on the sales. We border—the north border—Canadians are really pissed off.
Speaker #1: So, they're not going anywhere. In the US, we're seeing the north border a little weaker than the south border. We also, interestingly enough, saw a little bit of sales disruption in certain markets where there was a lot of iPad activity.
David Brown: We also, interestingly enough, saw a little bit of sales disruption in certain markets where there were a lot of ICE activity, which was interesting. But again, tariffs are a headwind, but there's a lot of positive aspects of what's going on. And most importantly, we're making the properties better. The Simon Plus, we'll see some benefits in 2026. And as an example, Alex, we just opened Chanel in Town Center at Boca Raton off to a really good start. And to make that kind of with that kind of retailer who's the best of the very best is just create so much momentum elsewhere. So in that sense, we're very bullish. Thank you. Sure. The next question comes from the line of Craig Mailman with Citi. You may proceed with your question. Hey, everyone. Just to follow up on the leasing, the pace of leasing's been pretty consistent here and strong.
We also, interestingly enough, saw a little bit of sales disruption in certain markets where there were a lot of ICE activity, which was interesting. But again, tariffs are a headwind, but there's a lot of positive aspects of what's going on. And most importantly, we're making the properties better. The Simon Plus, we'll see some benefits in 2026.
Speaker #1: Which was interesting. But again, tariffs are a headwind. But there are a lot of positive aspects of what's going on. And most importantly, we're making the properties better.
Speaker #1: The Simon Plus will see some benefits in '26. And as an example, Alex, we just opened Chanel in Boca Town Center. Off to a really good start.
And as an example, Alex, we just opened Chanel in Town Center at Boca Raton off to a really good start. And to make that kind of with that kind of retailer who's the best of the very best is just create so much momentum elsewhere. So in that sense, we're very bullish.
Speaker #1: And that's to make that kind of—with that kind of retailer—is the best of the very best. It just creates so much momentum elsewhere.
Speaker #1: So, in that sense, we're very—
Speaker #1: bullish. Thank
Alexander Goldfarb: Thank you.
Speaker #7: you.
David Simon: Sure.
Operator: The next question comes from the line of Craig Mailman with Citi. You may proceed with your question.
Speaker #1: Sure. The next question comes from the...
Speaker #8: Line of Craig Mailman. City, you may proceed with your question.
Speaker #8: question. Hey,
Craig Mailman: Hey, everyone. Just to follow up on the leasing, the pace of leasing's been pretty consistent here and strong.
Speaker #9: Everyone, just to follow up on the leasing—the pace of leasing has been pretty consistent here and strong. I'm just kind of curious about the tenor of the conversations, maybe as you're talking to retailers, and their demand and appetite to go into Class A, and what they're willing to pay for that versus maybe what a same tenant or vertical would be willing to pay for a space in Class B.
David Brown: I'm just kind of curious, the tenor of the conversations maybe as you're talking to retailers and their demand and appetite to go into Class A and what they're willing to pay for that versus maybe what a same tenant or vertical would be willing to pay for a space in Class B. I'm just kind of curious what the appetite looks like there and the pricing for that. Yeah. Well, I mean, pricing, it's just so space-market, asset-driven. Hopefully, AI will solve it for us so we don't have to negotiate. It'll just say, "Here is the rent that the tenant and the landlord should agree on, and then we can " I don't know what we do, but we can use that. So I can't really tell you. I mean, obviously, A assets have higher demand, but we're making a lot of progress in the Bs.
I'm just kind of curious, the tenor of the conversations maybe as you're talking to retailers and their demand and appetite to go into Class A and what they're willing to pay for that versus maybe what a same tenant or vertical would be willing to pay for a space in Class B. I'm just kind of curious what the appetite looks like there and the pricing for that.
Speaker #9: Just kind of curious what the appetite looks like there, and the pricing for that.
David Simon: Yeah. Well, I mean, pricing, it's just so space-market, asset-driven. Hopefully, AI will solve it for us so we don't have to negotiate. It'll just say, "Here is the rent that the tenant and the landlord should agree on, and then we can " I don't know what we do, but we can use that. So I can't really tell you. I mean, obviously, A assets have higher demand, but we're making a lot of progress in the Bs.
Speaker #1: Yeah. Well, I mean, pricing is—it's just so space, market, asset-driven. Hopefully, AI will solve it for us so we don't have to negotiate it.
Speaker #1: It'll just say, 'Here is the rent that the tenant and the landlord should agree on.' And then we can—I don't know what we do—but we can use that.
Speaker #1: So I can't really tell you. I mean, obviously, A assets have higher demand. But we're making a lot of progress in the Bs, and we don't really talk about pricing power.
David Brown: And we don't really talk about pricing power. We really talk about you can't force a deal. So it's the tenant has to agree. We have to agree. And it's a negotiation. And I would say how many leases did we do last year, guys? 40? 4,600? Yeah. 4,600. No, no, no, but square feet. 17 million. 17 million. So strangely enough, we figured out how to make deals on 17 million square feet. Okay? So it's more of an art than a science. Maybe AI can make it more of a science. And again, it's not pricing power. It's just what's the right deal for both of us? I mean, I guess, is it getting easier to lease Class B versus maybe 12 months ago? Any trends there? Yeah. I think that's a safe statement.
And we don't really talk about pricing power. We really talk about you can't force a deal. So it's the tenant has to agree. We have to agree. And it's a negotiation. And I would say how many leases did we do last year, guys? 40? 4,600? Yeah. 4,600. No, no, no, but square feet. 17 million. 17 million. So strangely enough, we figured out how to make deals on 17 million square feet. Okay? So it's more of an art than a science. Maybe AI can make it more of a science. And again, it's not pricing power. It's just what's the right deal for both of us?
Speaker #1: We really talk about, you can't force a deal. So, it's—the tenant has to agree, we have to agree, and it's a negotiation. And I would say, how many leases did we do last year, guys?
Speaker #9: 40.
Speaker #9: 4,600. No, no, no.
Speaker #1: Square
Speaker #1: Feet. Seventeen million. So, strangely enough, we figured out how to make deals on 17 million square feet. Okay? So it's more of an art than a science—maybe AI can make it more of a science.
Speaker #9: 17 million.
Speaker #1: But, and again, it's not pricing power; it's just what's the right deal for both of us.
Craig Mailman: I mean, I guess, is it getting easier to lease Class B versus maybe 12 months ago? Any trends there?
Speaker #9: Great. I mean, I guess, is it getting easier to lease Class B versus maybe 12 months ago?
Speaker #9: ago? Any trends there? Yeah.
David Simon: Yeah. I think that's a safe statement. And again, if you looked at Southdale Center a year or two years ago, you would say this was a C at. Okay? And now we've made it an A. So part of our job is to enhance the quality. And we don't discriminate on what we're trying to achieve.
Speaker #1: I think that's a safe statement. And again, if you looked at Southdale Mall a year or two years ago, you would say this was a C at.
David Brown: And again, if you looked at Southdale Center a year or two years ago, you would say this was a C at. Okay? And now we've made it an A. So part of our job is to enhance the quality. And we don't discriminate on what we're trying to achieve. What we're trying to achieve is if it's in Midland, Texas and by the way, I hope you watch Landman because that's in for those of you who've been to Odessa and Midland, which of course, I have been a few times, you really get the feel for it. But our job is to make Midland, Texas, which used to have a lot of volatility in the oil price, less so today.
Speaker #1: Okay? And now we've made it an A. So part of our job is to enhance the quality, and we don't discriminate on what we're trying to achieve.
What we're trying to achieve is if it's in Midland, Texas and by the way, I hope you watch Landman because that's in for those of you who've been to Odessa and Midland, which of course, I have been a few times, you really get the feel for it. But our job is to make Midland, Texas, which used to have a lot of volatility in the oil price, less so today.
Speaker #1: What we're trying to achieve is if it's in Midland, Texas, by the way, I hope you watch Landman because that's for those of you who've been to Odessa, in Midland, which of course I have been a few times, you really it's really you really get the feel for it.
Speaker #1: But our job is to make Midland Texas which does used to have a lot of volatility in the oil price. Less so today. But to make best it can be at the same that the time trying to make shore hills the best it can be.
David Brown: But to make that the best it can be, at the same time trying to make Short Hills the best it can be. And that's one of the hallmarks of our company in that we can do that. And it just takes a lot of focus, a lot of energy to do that. But at the same time, we can build an outlet like we did in Indonesia, right? I mean, very few companies can build in Indonesia and then build a new outlet in Oklahoma. Okay? So that's just what we're about. Great. Thank you. The next question comes from the line of Greg McGinnis with Scotiabank. Please proceed with your question. Hey, everyone. So normally, this question doesn't fall so deep into the question queue, but I think someone needs to ask.
But to make that the best it can be, at the same time trying to make Short Hills the best it can be. And that's one of the hallmarks of our company in that we can do that. And it just takes a lot of focus, a lot of energy to do that. But at the same time, we can build an outlet like we did in Indonesia, right? I mean, very few companies can build in Indonesia and then build a new outlet in Oklahoma. Okay? So that's just what we're about.
Speaker #1: And that's one of the hallmarks of our company, in that we can do that. And it just takes a lot of focus, a lot of energy to do that.
Speaker #1: But it's, at the same time, we can build an outlet like we did in Indonesia, right? I mean, very few companies can build in Indonesia and then build a new outlet in Oklahoma.
Speaker #1: Okay? So that's just what we're—
Speaker #1: about. Great.
Craig Mailman: Great. Thank you.
Speaker #9: Thank
Speaker #9: Thank you. The next question comes
Operator: The next question comes from the line of Greg McGinnis with Scotiabank. Please proceed with your question.
Speaker #8: From the line of Greg McGinnis, Scotiabank. Please proceed with your question.
Speaker #8: question. Hi, everyone.
Greg McGinniss: Hey, everyone. So normally, this question doesn't fall so deep into the question queue, but I think someone needs to ask. So Brian, how should we think about the factors that could drive Simon to the higher or lower end of the FFO per share guidance range, especially considering that you're already absorbing some additional unexpected bankruptcies versus the December budgeting process?
Speaker #10: So normally this question doesn't fall so deep into the question queue, but I think someone needs to ask. So Brian, how should we think about the factors that could drive Simon to the higher or lower end of the FFO per share guidance range, especially considering that you're already absorbing some additional unexpected bankruptcies versus the December budgeting?
David Brown: So Brian, how should we think about the factors that could drive Simon to the higher or lower end of the FFO per share guidance range, especially considering that you're already absorbing some additional unexpected bankruptcies versus the December budgeting process? Greg, I think the way to think about it is very similar to how we run our business. We start the beginning of the year very conservatively and build throughout the year. I think we touched upon a variety of these potential inputs that would drive the outperformance. Certainly, our ancillary businesses, our leasing business, sales, certainly, we've done. Yeah. Sales, to me, could be significant upside. As you probably know, we budget our sales flat-ish. And so if we get 3% growth, I would hope to beat our estimate. And to me, yeah, we'll have bankruptcies. Tenants will be delayed, that kind of stuff.
Speaker #10: Process? So Greg, I think the way to think—
Brian McDade: Greg, I think the way to think about it is very similar to how we run our business. We start the beginning of the year very conservatively and build throughout the year. I think we touched upon a variety of these potential inputs that would drive the outperformance. Certainly, our ancillary businesses, our leasing business, sales, certainly, we've done.
Speaker #1: It is very similar to how we run our business. We start the year very conservatively and build throughout the year. I think we touched upon a variety of these potential inputs that will drive the outperformance.
David Simon: Yeah. Sales, to me, could be significant upside. As you probably know, we budget our sales flat-ish. And so if we get 3% growth, I would hope to beat our estimate. And to me, yeah, we'll have bankruptcies. Tenants will be delayed, that kind of stuff.
Speaker #2: I would just say sales to me could be significant upside, because you probably know we budget our sales flat-ish. And so, if we get 3% growth, I would hope to beat our estimate.
Speaker #2: And to me, yeah, a lot of bankruptcies will happen, tenants will be delayed, that kind of stuff. But if we get the tenant sales growth that we hope to get, then we'll do better.
David Brown: But if we get the tenant sales growth that we hope to get, then we'll do better. And I don't anticipate doing worse in our range. Okay. Thank you. Thanks, Greg. The next question comes from the line of Vince Tabone with Green Street. You may proceed with your question. Hi. Good evening. I got one more on guidance. Can you just discuss the level of domestic property NOI guidance included in 2026 FFO? And then also, if you could just help quantify 2025 was a bigger acquisition year than the recent past, how much did 2025 completed acquisitions benefit or contribute to domestic property NOI in 2026? We're projecting 3% core NOI growth.
But if we get the tenant sales growth that we hope to get, then we'll do better. And I don't anticipate doing worse in our range.
Speaker #2: And I would, I don't anticipate doing worse in our range.
Greg McGinniss: Okay. Thank you.
Speaker #10: Okay. Thank you.
David Simon: Thanks, Greg.
Speaker #1: Thanks, Greg.
Operator: The next question comes from the line of Vince Tabone with Green Street. You may proceed with your question.
Speaker #8: The next question comes from Vince Tabone with Green Street. You may proceed with your question.
Vince Tibone: Hi. Good evening. I got one more on guidance. Can you just discuss the level of domestic property NOI guidance included in 2026 FFO? And then also, if you could just help quantify 2025 was a bigger acquisition year than the recent past, how much did 2025 completed acquisitions benefit or contribute to domestic property NOI in 2026?
Speaker #2: Hi, good evening. I have one more question on guidance. Can you discuss the level of domestic property NOI guidance included in '26 FFO? And then also, if you could just help quantify—2025 is a bigger acquisition year than the recent past.
Speaker #2: How much should 25 completed acquisitions benefit or contribute to domestic property NOI in '26?
David Simon: We're projecting 3% core NOI growth. The deals, Taubman really is a 2027 story because you'll see an announcement from us tomorrow or the next day on some transformations of three properties that now that we've got our hands on. We also have the integration, which is a 2026 story. So we obviously issued the units as well, and we haven't quarterized that, which is our intent.
Speaker #1: We're projecting 3% cost NOI growth. The deals—Taubman really is a 27-story. Because of—you'll see an announcement from us tomorrow or the next day on some transformations of three properties that now that we've got our hands on. We also have the integration, which is a '26 story.
David Brown: The deals, Taubman really is a 2027 story because you'll see an announcement from us tomorrow or the next day on some transformations of three properties that now that we've got our hands on. We also have the integration, which is a 2026 story. So we obviously issued the units as well, and we haven't quarterized that, which is our intent. People made fun of that name, but that's a legit use of the word. So we really haven't done much of that yet, and we'll be prudent about that. That's not really in the guidance. And the other deals helped a few cents, but they're all early days. No, that's really helpful, Carl. A couple were pretty small, but all over time, will contribute to our growth. No, that makes sense. It's really helpful. If I can maybe squeeze in a quick follow-up.
Speaker #1: So, we obviously issued the units as well, and we haven't quarterized that, which is our intent. People made fun of that name, but that's a legit use of the word.
People made fun of that name, but that's a legit use of the word. So we really haven't done much of that yet, and we'll be prudent about that. That's not really in the guidance. And the other deals helped a few cents, but they're all early days. No, that's really helpful, Carl. A couple were pretty small, but all over time, will contribute to our growth.
Speaker #1: So, we really haven't done much of that yet, and we'll be prudent about that. That's not really in the guidance. So—and the other deals helped a few cents.
Speaker #1: But they're all early days.
Speaker #2: No, that's really helpful, Paul.
Speaker #1: A couple were pretty small, but over time, we'll contribute to our—
Vince Tibone: No, that makes sense. It's really helpful. If I can maybe squeeze in a quick follow-up.I think, Brian, you mentioned earlier, I think, $30 million of NOI coming online from redevelopment this year. Is that a net figure adjusting for any NOI that's going to be taken offline for some of the Taubman projects you just discussed, or should we model more NOI coming offline than the $30 million if you follow me?
Speaker #2: No, that makes sense. That's really helpful. If I can maybe squeeze in a quick follow-up—I think, Brian, you mentioned earlier, I think, $30 million of NOI coming online from redevelopment this year.
David Brown: I think, Brian, you mentioned earlier, I think, $30 million of NOI coming online from redevelopment this year. Is that a net figure adjusting for any NOI that's going to be taken offline for some of the Taubman projects you just discussed, or should we model more NOI coming offline than the $30 million if you follow me? It wasn't a net number, no. It was basically our deliveries at the expected yield. There's some timing elements to it as well. Yeah. Most of what we're doing, again, is backend-weighted. So that's just a, let's verify that number. But that's just more backend-weighted and not the full NOI, NIY, net initial yield to those properties, those redevelopments. Again, I'll give you examples. Ann Arbor, opening, best case Q4. Brea, best case Q4. Mission, best case Q4. And I can go down the line.
Speaker #2: Is that a net figure, like adjusting for any NOI that's going to be taken offline for some of the Taubman projects you just discussed?
Speaker #2: Or should we model more NOI coming offline than the 30 you follow?
Speaker #2: me? It wasn't a net
Brian McDade: It wasn't a net number, no. It was basically our deliveries at the expected yield. There's some timing elements to it as well. Yeah. Most of what we're doing, again, is backend-weighted. So that's just a, let's verify that number. But that's just more backend-weighted and not the full NOI, NIY, net initial yield to those properties, those redevelopments. Again, I'll give you examples. Ann Arbor, opening, best case Q4. Brea, best case Q4. Mission, best case Q4. And I can go down the line.
Speaker #1: No. It was basically our deliveries at the expected yields. There's some timing elements to it as well.
Speaker #2: Yeah. Most of what we're most of what we're doing again is backend-weighted. So that's just a let's verify that number. But that's just a more backend-weighted and not the full NIL, NIY net initial yield for those properties.
Speaker #2: Those redevelopments—again, to give you examples: Ann Arbor, opening best-case, fourth quarter; Brea, best-case, fourth quarter; Mission, best-case, fourth quarter. And I can go down the line.
Speaker #2: But most of all, that is very, very limited, backend-weighted Q4 openings. Makes sense. Thank you.
David Brown: But most of all of that is very, very limited backend-weighted Q4 openings. Northgate. Okay. Thank you. Okay. Thank you. The next question comes from the line of Floris van Dijkum with Ladenburg Thalmann. You may proceed with your question. Hey. Thanks, guys. So quarterized, I guess, is an appropriate term. So I guess that's another 3 million of shares that you could be buying back, it sounds like, which obviously would be accretive. My question is more on your as I usually ask about your S&O pipeline and how that is progressing, and how do you see that trending throughout 2026 and into as you sign your 17 million of leases? If you can maybe, Brian, if you can give a little commentary around that. And what percentage of that S&O pipeline is luxury versus your traditional retailers? Floris with Brian.
But most of all of that is very, very limited backend-weighted Q4 openings. Northgate.
Vince Tibone: Okay. Thank you.
Speaker #2: you. Okay.
Brian McDade: Okay. Thank you.
Speaker #1: Thank
Speaker #1: You. The next question comes from the line.
Operator: The next question comes from the line of Floris van Dijkum with Ladenburg Thalmann. You may proceed with your question.
Speaker #8: Floris van Dijkum with Leidenberg. You may proceed with your question.
Floris van Dijkum: Hey. Thanks, guys. So quarterized, I guess, is an appropriate term. So I guess that's another 3 million of shares that you could be buying back, it sounds like, which obviously would be accretive. My question is more on your as I usually ask about your S&O pipeline and how that is progressing, and how do you see that trending throughout 2026 and into as you sign your 17 million of leases? If you can maybe, Brian, if you can give a little commentary around that. And what percentage of that S&O pipeline is luxury versus your traditional retailers?
Speaker #10: Hey, thanks, guys. So quarter-wise, I guess, is an appropriate term. So I guess that's another 3 million shares that you could be buying back.
Speaker #10: It sounds like. Which obviously would be a creative my question is more on your as I usually ask about your S&O pipeline and how that is progressing and how do you see that trending throughout '26 and into as you sign your '17 million of leases?
Speaker #10: If you can, maybe Brian, if you can give a little commentary around that and what percentage of that S&O pipeline is luxury versus your traditional.
Speaker #10: retailers? Floris and Brian.
Brian McDade: Floris with Brian. So at year-end, we were about 2.1% of S&O, which is consistent with the prior several years at 31 December. As you know, we open the fourth quarter, the vast majority of retailers, and then the momentum builds throughout the balance of the year. So you would expect that number to go up second, third, and fourth quarter.
Speaker #1: So at year-end, we were about 2.1% of S&O, which is consistent with the prior several years in '12, '31. As you know, we opened the fourth quarter, the vast majority of retailers.
David Brown: So at year-end, we were about 2.1% of S&O, which is consistent with the prior several years at 31 December. As you know, we open the fourth quarter, the vast majority of retailers, and then the momentum builds throughout the balance of the year. So you would expect that number to go up second, third, and fourth quarter. Yeah. I think it's good that that number the way I would look at it is I think that that number's staying almost stable because that means we're replacing tenants or filling vacant space, and it's not going down. So there's positive churn in that, which is good. So let me just make sure I understand. So 210 basis points of S&O is what it was at year-end. What percentage of that is luxury tenants, if you can give a little bit more color on that? Yeah.
Speaker #1: And then the momentum builds throughout the balance of the year. So we would expect that number to go up in the second, third, and fourth quarters.
Speaker #1: quarter. Yeah.
Speaker #2: I think it's good that— that number, the way I would look at it is, it's good that that number's staying almost stable. Because that means we're replacing tenants or filling vacant space.
David Simon: I think it's good that that number the way I would look at it is I think that that number's staying almost stable because that means we're replacing tenants or filling vacant space, and it's not going down. So there's positive churn in that, which is good.
Speaker #2: And it's not going down. So there's positive churn in that, which is—
Speaker #2: Good. So let me just make sure I—
Floris van Dijkum: So let me just make sure I understand. So 210 basis points of S&O is what it was at year-end. What percentage of that is luxury tenants, if you can give a little bit more color on that?
Speaker #10: Understood. So, 210 basis points of S&O is what it was at year-end? What percentage of that is luxury tenants? If you can give a little bit more color on that.
David Simon: Yeah. We don't get into that, but it's not half of it, right? They're very selective. They're very focused. But we don't really; it's not anywhere near the majority. It's well less than half. But it's not the size. It's the quality. So that's how you have to look at it. You could add Southdale Center as a great example. Southdale Center, again, is probably 1.4 million sq ft, 1.3 million, huge number.
Speaker #1: Yeah, we don't get into that. But it's not half of it, right? They're very selective, they're very focused, but we don't really—it's not anywhere near the majority.
David Brown: We don't get into that, but it's not half of it, right? They're very selective. They're very focused. But we don't really; it's not anywhere near the majority. It's well less than half. But it's not the size. It's the quality. So that's how you have to look at it. You could add Southdale Center as a great example. Southdale Center, again, is probably 1.4 million sq ft, 1.3 million, huge number. It's got all sorts of funky basement and a third-level space. Put all that aside, what transformed Southdale Center was essentially 70,000 sq ft of high-end leasing. So it's the quality, not the quantity. So that's what you should focus on.
Speaker #1: It's well less than half. But it's not the size; it's the quality. So that's how you have to look at it. You could add, Southdale is a great example.
Speaker #1: Southdale, set again, is probably a million four square feet, million three. Huge number. It's got all sorts of funky basement, third-level space—put all that aside.
It's got all sorts of funky basement and a third-level space. Put all that aside, what transformed Southdale Center was essentially 70,000 sq ft of high-end leasing. So it's the quality, not the quantity. So that's what you should focus on.
Speaker #1: What transformed Southdale was essentially 70,000 square feet of high-end leasing. So it's the quality, not the quantity. So that's what you should focus on.
Speaker #1: It's not, 'Oh, they're going to do 500,000 square feet of luxury.' It's, 'If you can add 20,000, 30,000, 40,000 in the right markets, it makes a real difference.' And that's what you should look out for.
David Brown: It's not, "Oh, they're going to do 500,000 sq ft of luxury." It's, "If you can add 20, 30, 40 thousand in the right markets, it makes a real difference." And that's what you should look out for, not the actual amount of the S&O. And David, that's very helpful, by the way. Thank you. But are there any more Southdales expected in the pipeline? Yeah. Oh, yeah. Oh, yeah. Eli is going to announce something tomorrow or the next tomorrow, maybe. Tomorrow. I haven't proved it yet. Yeah. We definitely think there's more to do. Thanks. Thank you. The next question comes from the line of Omotayo Okusanya with Deutsche Bank. You may proceed with your question. Yes. Good evening, everyone. Just curious about deal flow. $2 billion of activity in 2025 was pretty good.
It's not, "Oh, they're going to do 500,000 sq ft of luxury." It's, "If you can add 20, 30, 40 thousand in the right markets, it makes a real difference." And that's what you should look out for, not the actual amount of the S&O.
Speaker #1: Not the actual amount—of the S&O.
Floris van Dijkum: And David, that's very helpful, by the way. Thank you. But are there any more Southdales expected in the pipeline?
Speaker #10: And David, that's very helpful, by the way. Thank you. But are there any more Southdales expected in the pipeline?
Speaker #2: Yeah. Oh, yeah. Oh, yeah. Eli's going to announce something tomorrow or the next tomorrow? Maybe? Tomorrow? I haven't approved it yet. Yeah. We think—we definitely think—there's more to do.
David Simon: Yeah. Oh, yeah. Oh, yeah. Eli is going to announce something tomorrow or the next tomorrow, maybe. Tomorrow.
Eli Simon: I haven't proved it yet. Yeah. We definitely think there's more to do.
Floris van Dijkum: Thanks.
David Simon: Thank you.
Speaker #10: Thanks.
Speaker #1: Thank you.
Eli Simon: The next question comes from the line of Omotayo Okusanya with Deutsche Bank. You may proceed with your question.
Speaker #8: The next question comes from the line of Omatayo Okusanya with Deutsche Bank. You may proceed with your question.
Speaker #8: question. Hi.
Omotayo Okusanya: Yes. Good evening, everyone. Just curious about deal flow. $2 billion of activity in 2025 was pretty good. Just curious, as you're looking globally, what you're seeing out there and how we should kind of be thinking about that in 2026?
Speaker #10: Yes. Good evening, everyone. Just curious about deal flow. $2 billion of activity in 2025 was pretty good. Just curious, as you're looking globally, what you're seeing out there and how we should kind of be thinking about that in '26.
David Brown: Just curious, as you're looking globally, what you're seeing out there and how we should kind of be thinking about that in 2026? Yeah. I mean, listen, we always look, but we have a very high bar, right? The best way to think about it is it has to be something that is brand accretive to our portfolio. It's something that we can add our expertise, whether it's leasing, intensification, property management, and just running it better. It has to be at the right price. And so last year, we were able to find a few of those transactions that we're very excited about and are off to a good start. And if there are more of those, great. And if not, we'll continue to reinvest into our existing portfolio, which we're earning great yields and obviously have a big and growing shadow pipeline behind that. Yeah.
David Simon: Yeah. I mean, listen, we always look, but we have a very high bar, right? The best way to think about it is it has to be something that is brand accretive to our portfolio. It's something that we can add our expertise, whether it's leasing, intensification, property management, and just running it better. It has to be at the right price.
Speaker #2: Yeah, I mean, listen, we always look, but we have a very high bar, right? The best way to think about it is it has to be something that is brand-accretive to our portfolio and something where we can add our expertise—whether it's leasing, intensification, property management, just running it better.
Speaker #2: And it has to be at the right price. And so, last year, we were able to find a few of those transactions that we were very excited about.
And so last year, we were able to find a few of those transactions that we're very excited about and are off to a good start. And if there are more of those, great. And if not, we'll continue to reinvest into our existing portfolio, which we're earning great yields and obviously have a big and growing shadow pipeline behind that. Yeah.
Speaker #2: And they're off to a good start. And if there are more of those, great. And if not, we'll continue to reinvest into our existing portfolio, which we're earning great yields.
Speaker #2: And, obviously, had a big and growing shadow pipeline behind that.
Speaker #1: Yeah, I think with our new development in South Nashville and all the redevelopment mixed-use pipeline, the bar to buy something for us is—you don't have to be an Olympic high jumper.
David Brown: I think with our new development in South Nashville and all the redevelopment mixed-use pipeline, the bar to buy something for us is you don't have to be an Olympic high jumper, but you got to have more hops than Ward, okay? And why I'm saying this is because we are really excited about our redevelopment pipeline. And it's not a capital question. It's just we're blowing it going. And take and it just pops into my head, but take Boca as an example. We finally won the litigation. We were able to buy the building from Seritage. And that development in itself could be $500 million. And that's just one example that pops in my head about we have the same thing at Fashion Valley in San Diego, digging the Penny building and creating mixed-use and more retail space. So that.
I think with our new development in South Nashville and all the redevelopment mixed-use pipeline, the bar to buy something for us is you don't have to be an Olympic high jumper, but you got to have more hops than Ward, okay? And why I'm saying this is because we are really excited about our redevelopment pipeline. And it's not a capital question. It's just we're blowing it going.
Speaker #1: But you got to have more hops than water, okay? And why I'm saying this is because we are really excited about our redevelopment pipeline.
Speaker #1: And it's not a capital question. It's just it's a we're long gone. And take and I just pops into my head. But take Boca.
And take and it just pops into my head, but take Boca as an example. We finally won the litigation. We were able to buy the building from Seritage. And that development in itself could be $500 million. And that's just one example that pops in my head about we have the same thing at Fashion Valley in San Diego, digging the Penny building and creating mixed-use and more retail space. So that.
Speaker #1: As an example, we finally won the litigation, and we were able to buy the building. And that development in itself could be $500 million.
Speaker #1: And that's just one example that pops in my head about— we have the same thing at Fashion Valley in San Diego, taking the Penny Building and creating mixed-use and more retail space.
Speaker #1: So, that, and then we've got the new development in Nashville, which could be $500 million. So, Woodbury. Extension of Woodbury. Extension of—
David Brown: And then we've got the new development in Nashville, which could be $500 million. So Woodbury, extension of Woodbury, extension of Toronto. Desert Hills. Desert Hills. So these things are very exciting to us. And so we got to be we have to have similar excitement if we buy something. And that similar excitement has to then be grounded by what Eli said, which is, "Does it fit with our portfolio? Can we add value? What's the game plan?" And I'll take the one that we bought in Brickell. Now that we've taken over leasing, we got a lot of great stuff in the works there in an asset that 10 years from now will be worth $3 to 4 billion. Gotcha. Thank you. Thank you. The next question comes from the line of Linda Tsai with Jefferies. Please proceed with your question. Thanks for taking my question.
And then we've got the new development in Nashville, which could be $500 million. So Woodbury, extension of Woodbury, extension of Toronto. Desert Hills. Desert Hills. So these things are very exciting to us. And so we got to be we have to have similar excitement if we buy something.
Speaker #1: Toronto. Desert Hills. Desert Hills. So these things are very exciting to us. And so we have to have similar excitement if we buy something.
And that similar excitement has to then be grounded by what Eli said, which is, "Does it fit with our portfolio? Can we add value? What's the game plan?" And I'll take the one that we bought in Brickell. Now that we've taken over leasing, we got a lot of great stuff in the works there in an asset that 10 years from now will be worth $3 to 4 billion.
Speaker #1: And that similar excitement has to then be grounded by what Eli said, which is: does it fit with our portfolio? Can we add value?
Speaker #1: What's the game plan? And I'll take the one that we bought in Brickell. Now that we've taken over leasing, we've got a lot of great stuff in the works there.
Speaker #1: And then an asset that 10 years from now will be worth $3 to $4 billion.
Speaker #10: Gotcha. Thank you.
Omotayo Okusanya: Gotcha. Thank you.
David Simon: Thank you.
Speaker #1: you.
Operator: The next question comes from the line of Linda Tsai with Jefferies. Please proceed with your question.
Speaker #8: The next question comes from the line of Linda Sy with Jefferies. Please proceed with your question.
Speaker #8: question. Thanks for taking my
Linda Tsai: Thanks for taking my question. Just a follow-up on the redevelopments. When you engage in them, are you relocating retailers within your existing property or drawing new retailers into the market or taking share from other assets in the area?
Speaker #11: Just to follow up on the redevelopments, when you engage in them, are you relocating retailers within your existing property, or drawing new retailers into the market?
David Brown: Just a follow-up on the redevelopments. When you engage in them, are you relocating retailers within your existing property or drawing new retailers into the market or taking share from other assets in the area? We are bringing most of the time, you'll always relocate some existing retailers in the existing building. But most of the time, we're bringing new entrants into the market. Thank you. And then just on occupancy for 2026 versus 2025, how are you thinking about that? And does it vary at all across different formats, Premium Outlets, malls, mills? Linda, we do expect that there is some upward opportunity in our occupancy for the year across the platforms. Thank you. The next question comes from the line of Mike Mueller with J.P. Morgan. Please proceed with your question. Yeah. Hi. Can you talk a little bit about the institutional appetite for higher productivity malls?
Speaker #11: Or taking share from other assets in the area?
David Simon: We are bringing most of the time, you'll always relocate some existing retailers in the existing building. But most of the time, we're bringing new entrants into the market.
Speaker #1: We're bringing—most of the time, you're always relocating some existing retailers in the existing buildings. But most of the time, we're bringing new entrants into the market.
Linda Tsai: Thank you. And then just on occupancy for 2026 versus 2025, how are you thinking about that? And does it vary at all across different formats, Premium Outlets, malls, mills?
Speaker #11: Thank you. And then just on occupancy, for '26 versus '25, how are you thinking about that? And does it vary at all across different formats—premium outlets, malls,
Speaker #11: Mills? Linda, we do expect that there is
David Simon: Linda, we do expect that there is some upward opportunity in our occupancy for the year across the platforms.
Speaker #1: some upward opportunity in our occupancy for the year across the
Speaker #1: platforms. Thank
Linda Tsai: Thank you.
Speaker #11: you. The next question
Operator: The next question comes from the line of Mike Mueller with J.P. Morgan. Please proceed with your question.
Speaker #8: Comes from the line of Mike Mueller with JP Morgan. Please proceed with your question.
Speaker #8: question.
Mike Mueller: Yeah. Hi. Can you talk a little bit about the institutional appetite for higher productivity malls? For example, are your JV partners looking to invest more with you, or are we more likely to see you buy them out?
Speaker #10: Yeah. Hi. Can you talk a little bit about—
Speaker #10: The institutional appetite for higher productivity malls—are your JV partners looking to invest more with you, or are we more likely to see you buy them out?
David Brown: For example, are your JV partners looking to invest more with you, or are we more likely to see you buy them out? It's really, we don't have a lot, to be honest. And what I've noticed, it's really partner by partner. And a lot of it depends on how long they've held the asset, what's going on with their real estate investments, etc. So it's hard for me to say it's really one way or another. But there's not a rush to get out, and I would say there's not a rush to get in. And if I had to make it if I had to make a simplistic statement, which I'm very confident in, right, because simple assessment, right, it's kind of more status quo. Got it. Okay. Thank you. Sure. Thank you, Michael. The next question comes from the line of Haendel St. Juste.
David Simon: It's really, we don't have a lot, to be honest. And what I've noticed, it's really partner by partner. And a lot of it depends on how long they've held the asset, what's going on with their real estate investments, etc. So it's hard for me to say it's really one way or another. But there's not a rush to get out, and I would say there's not a rush to get in. And if I had to make it if I had to make a simplistic statement, which I'm very confident in, right, because simple assessment, right, it's kind of more status quo.
Speaker #1: It's really—we don't have a lot, to be honest. And what I've noticed is it's really partner by partner, and a lot of it depends on how long they've held the asset, what's going on in their real estate investments, etc.
Speaker #1: So it's hard for me to say it's really one way or another. But there's not a rush to get out, and I would say there's not a rush to get in.
Speaker #1: And if I had to make it—if I had to make a simplistic statement, which I'm very confident in, right, because simple assignment, right, it's kind of more status.
Speaker #1: quo. Got it.
Mike Mueller: Got it. Okay. Thank you.
Speaker #10: Okay. Thank you.
David Simon: Sure. Thank you, Michael.
Speaker #1: Sure. Thank you, Michael.
Operator: The next question comes from the line of Haendel St. Juste with Mizuho Securities. You may proceed with your question.
Speaker #8: The next question comes from the line of Handel St. Juste with Mizuho Securities. You may proceed with your question.
David Brown: Juste with Mizuho Securities. You may proceed with your question. Hey. Good evening. Thanks for taking my question. I wanted to ask about luxury. I was hoping you could talk a little bit more about what you're seeing and hearing from luxury shoppers and tenants. The upper-end consumer has clearly been resilient, but it looks like some of the luxury brands, LVMH in particular, might be signaling a bit more caution for luxury this year, some of that obviously tied to tariffs, Chinese spending. So I guess I'm curious, what's your view and expectation for leasing demand and sales productivity from that tenant category for this year? Thanks. Sure. I would say, again, it's so dependent upon the company and then within the company, the brand. There's some that are growing. There's some that are still making deals but a little more cautious.
Speaker #8: question. Hey.
Haendel St. Juste: Hey. Good evening. Thanks for taking my question. I wanted to ask about luxury. I was hoping you could talk a little bit more about what you're seeing and hearing from luxury shoppers and tenants. The upper-end consumer has clearly been resilient, but it looks like some of the luxury brands, LVMH in particular, might be signaling a bit more caution for luxury this year, some of that obviously tied to tariffs, Chinese spending. So I guess I'm curious, what's your view and expectation for leasing demand and sales productivity from that tenant category for this year? Thanks.
Speaker #2: Good evening. Thanks for taking my question. I wanted to ask about luxury. I was hoping you could talk a little bit more about what you're seeing and hearing from luxury shoppers and tenants. The upfront consumer has clearly been resilient, but it looks like some of the luxury brands—LVMH in particular—might be signaling a bit more caution for luxury this year.
Speaker #2: Some of that obviously tied to tariffs, Chinese spending. So I guess I'm curious, what's your view and expectation for leasing demand and sales productivity from that tenant category for this year?
Speaker #2: Thanks.
David Simon: Sure. I would say, again, it's so dependent upon the company and then within the company, the brand. There's some that are growing. There's some that are still making deals but a little more cautious. And then there's some that are slightly pulling back. The good news is that what they have all discovered over the last decade or so is the US is a lot bigger market than they ever thought it could be. So in the long run, they're all very, very much dedicated to being an important player here.
Speaker #1: Sure. I would say, again, it's so dependent upon the company, and then within the company, the brand. There are some that are growing. There are some that are still making deals, but are a little more cautious.
Speaker #1: And then there's some that are slightly pulling back. The good news is that what all discovered they have in the over the last decade or so is the U.S. is a lot bigger market than they ever thought it could be.
David Brown: And then there's some that are slightly pulling back. The good news is that what they have all discovered over the last decade or so is the US is a lot bigger market than they ever thought it could be. So in the long run, they're all very, very much dedicated to being an important player here. Their wholesale business is obviously affected by what's going on with Saks Global. And that could inure to our benefit, potentially. It might not. So I think as they look at their positioning, they're certainly going to have an opinion on that. And we're optimistic that they'll continue to do business with Saks/Neiman and that we'll reorg and live a better life with a better balance sheet. But I'd say generally, it's steady as she goes. Some growing, some peeling the onion, and a lot of them just stable.
Speaker #1: So, in the long run, they're all very much dedicated to being an important player here. Their wholesale business, obviously, is affected by what's going on with Saks Global.
Their wholesale business is obviously affected by what's going on with Saks Global. And that could inure to our benefit, potentially. It might not. So I think as they look at their positioning, they're certainly going to have an opinion on that. And we're optimistic that they'll continue to do business with Saks/Neiman and that we'll reorg and live a better life with a better balance sheet. But I'd say generally, it's steady as she goes. Some growing, some peeling the onion, and a lot of them just stable.
Speaker #1: And that could inure to our benefit. Potentially. It might not. So I think as they look at their positioning, they're certainly going to have an opinion on that.
Speaker #1: And we're optimistic that they'll continue to do business with Saks/Neiman, and that we'll reorg and live a better life with a better balance sheet.
Speaker #1: But I'd say generally, it's steady as she goes. Some growing, some feeling the onion, and a lot of them just stable, and the great thing about these brands is they make long-term decisions.
David Brown: And the great thing about these brands is they make long-term decisions. They really invest in the brand, and they really invest in the stores. And they do it over almost a little bit like us. They do it over a little bit longer horizon than quarter to quarter and year to year. And we really like being aligned with those kind of high-quality retailers. Thank you for the color. Sure. The next question comes from the line of Juan Sanabria with BMO Capital Markets. You may proceed with your question. Good afternoon. Just first, a quick follow-up. I think you mentioned the leasing pipeline was up 15% year-over-year. So just curious if that number was benefiting from and if so, what the kind of apples-to-apples number is.
And the great thing about these brands is they make long-term decisions. They really invest in the brand, and they really invest in the stores. And they do it over almost a little bit like us. They do it over a little bit longer horizon than quarter to quarter and year to year. And we really like being aligned with those kind of high-quality retailers.
Speaker #1: They really invest in the brand and they really invest in the stores, and they do it over us—almost a little bit like, they do it over a little bit longer horizon.
Speaker #1: Then, quarter to quarter and year to year. And we really like being aligned with those kind of high-quality—
Speaker #1: retailers. Thank you for the
Haendel St. Juste: Thank you for the color.
Speaker #2: color.
David Simon: Sure.
Operator: The next question comes from the line of Juan Sanabria with BMO Capital Markets. You may proceed with your question.
Speaker #1: Sure. The next
Speaker #8: The next question comes from the line of Juan Sanabria with BMO Capital Markets. You may proceed with your question.
Speaker #8: question. Hi.
Juan Sanabria: Good afternoon. Just first, a quick follow-up. I think you mentioned the leasing pipeline was up 15% year-over-year. So just curious if that number was benefiting from and if so, what the kind of apples-to-apples number is.
Speaker #3: Good afternoon. Just first, a quick follow-up. I think you mentioned that pipeline and leasing pipeline was up 15% year over year. So just curious if that number was benefiting from, and if so, what the kind of apples-to-apples number is?
Speaker #3: But then, just the broader question is, on these anchor boxes, how should we think about the potential capital investments for Saks and Neiman’s, as those come back to you over time?
David Brown: But then just the broader question is just on these anchor boxes, how should we think about the potential capital investments for Saks and Neimans as those come back to you over time and kind of what you think the top five, let's say, most likely uses are for those boxes across the portfolio? Well, yeah, the 15% is like-for-like, essentially. Because remember, we literally just took over Taubman leasing two days ago, it feels like, right? But that's like-for-like. I mentioned earlier the upside that we see in off fifth. So we'll see a positive impact from both a tenant mix and a cash flow over time. And then the other, I don't think we're going to have that dramatic of an impact, but it's early days here.
But then just the broader question is just on these anchor boxes, how should we think about the potential capital investments for Saks and Neimans as those come back to you over time and kind of what you think the top five, let's say, most likely uses are for those boxes across the portfolio?
Speaker #3: And kind of what you think the top five, let's say, most likely uses are for those boxes across the portfolio?
David Simon: Well, yeah, the 15% is like-for-like, essentially. Because remember, we literally just took over Taubman leasing two days ago, it feels like, right? But that's like-for-like. I mentioned earlier the upside that we see in off fifth. So we'll see a positive impact from both a tenant mix and a cash flow over time. And then the other, I don't think we're going to have that dramatic of an impact, but it's early days here.
Speaker #1: Well, yeah, the 15% is like-for-like, essentially. Because remember, we literally just took over Calvin Leasing two days ago, it feels like. Right? So that's like-for-like.
Speaker #1: I mentioned earlier the upside that we see in all fifth. So we'll see a positive impact from both the tenant mix and the cash flow.
Speaker #1: Over time. And then the other, I don't think we're going to have that dramatic of an impact, but it's early days there. And then, if we get boxes back, we'll do what we've been doing.
David Brown: And then if we get boxes back, we'll do what we've been doing with dealing with all the Sears vacancies, the boxes we got back from Penny when they filed. I mean, the one thing we're very capable of is reimagining the real estate in the boxes. And at the end of the day, gives us the opportunity to redo the real estate, which is kind of what started with Southdale. Or how big is Southdale? 1.3. 1.3, right? I only have 200 and how many properties do I have now? 254. So I only have 254. But somehow, I remembered Southdale, right? Okay. So Southdale is an example. That whole redevelopment was spurred by, I believe, around Herberger's going out of business. And then we got the Penny box back, and that's where we put Life Time in. So there's Life Time deals to do.
And then if we get boxes back, we'll do what we've been doing with dealing with all the Sears vacancies, the boxes we got back from Penny when they filed. I mean, the one thing we're very capable of is reimagining the real estate in the boxes. And at the end of the day, gives us the opportunity to redo the real estate, which is kind of what started with Southdale.
Speaker #1: With dealing with all the Sears vacancies, the boxes we got back from Penney when they filed—I mean, the one thing we're very capable of is reimagining the real estate in the boxes, and at the end of the day, it gives us the opportunity to redo the real estate.
Speaker #1: What started with Southdale, or how big is Southdale?
Or how big is Southdale? 1.3. 1.3, right? I only have 200 and how many properties do I have now? 254. So I only have 254. But somehow, I remembered Southdale, right? Okay. So Southdale is an example. That whole redevelopment was spurred by, I believe, around Herberger's going out of business. And then we got the Penny box back, and that's where we put Life Time in. So there's Life Time deals to do.
Speaker #1: About 43. Over 30. Well, I only have...
Speaker #3: 33.
Speaker #1: 200, and how many properties do I have now? So I only have—
Speaker #3: 254.
Speaker #1: Two fifty-four. But somehow I remembered Southdale, right? Okay, so Southdale is an example. That whole redevelopment was spurred by, I believe, Hertzberger going out of business.
Speaker #1: So, and then we got the Penny box back, and that's where we put Lifetime in. Which is kind of—so, there's Lifetime deals to do.
Speaker #1: There's House of Sports deals to do. There's mixed use to do. There are outdoor additions to do. So it really runs the spectrum, and we'll see where it goes.
David Brown: There's House of Sport deals to do. There's mixed-use to do. There's outdoor additions to do. So it really runs the spectrum. And we'll see where it goes. I mean, we don't know yet, so it's early days. My guess is we'll have a better feel for it when we next speak. Thank you. Sure. The next question comes from the line of Rich Hightower with Barclays. You may proceed with your question. Hi. Good evening, guys. Thanks for taking the question. Just a small clarifying question on Saks and then a separate question from that, if I may. I think it was reported that Simon’s got a $100 million investment in that entity as well. And so just help us understand what happens to that and how that investment might, in some way, control the outcome to whatever extent.
There's House of Sport deals to do. There's mixed-use to do. There's outdoor additions to do. So it really runs the spectrum. And we'll see where it goes. I mean, we don't know yet, so it's early days. My guess is we'll have a better feel for it when we next speak.
Speaker #1: I mean, we don't know yet, so it's early days. My guess is we'll have a better feel for it when we next speak.
Juan Sanabria: Thank you.
Speaker #3: Thank you.
David Simon: Sure.
Operator: The next question comes from the line of Rich Hightower with Barclays. You may proceed with your question.
Speaker #1: Sure. The next
Speaker #8: The question comes from the line of Rich Hightower with Barclays. You may proceed with your question.
Speaker #8: question. Hi.
Rich Hightower: Hi. Good evening, guys. Thanks for taking the question. Just a small clarifying question on Saks and then a separate question from that, if I may. I think it was reported that Simon’s got a $100 million investment in that entity as well. And so just help us understand what happens to that and how that investment might, in some way, control the outcome to whatever extent.
Speaker #9: Good evening, guys. Thanks for taking the question. Just a small clarifying question on Saks, and then a separate question from that if I may.
Speaker #9: I think it was reported that Simon's got a $100 million investment in that entity as well. And so, just help us understand what happens to that and how that investment might in some way control the outcome, to whatever extent.
Speaker #9: And then my second question is just updated thoughts, if you have any, on the exchangeable Euro debt that comes due later this year and the potentiality of putting Kleppinger shares to the debt holders there.
David Brown: And then my second question is just updated thoughts, if you have any, on the exchangeable euro debt that comes due later this year and the potentiality of putting Klépierre shares to the debt holders there, what the math looks like there. Thank you. Sure. So let me answer the second first. We have gotten some redemption notices, and we've been issuing shares. Brian, what's the total number? 1.5 million shares. So we've issued 1.5 million shares to satisfy the bond when we get it put. So that's what's happened. That's factual. Your first question is, we did a transaction with Saks Global as part of their funding for buying Neiman Marcus. Now, as part of that, we decided we weren't just going to make that investment unless we got compensated for it. So in case it blew up, we would be whole.
And then my second question is just updated thoughts, if you have any, on the exchangeable euro debt that comes due later this year and the potentiality of putting Klépierre shares to the debt holders there, what the math looks like there.
Speaker #9: What the math looks like there. Thank you.
David Simon: Thank you. Sure. So let me answer the second first. We have gotten some redemption notices, and we've been issuing shares. Brian, what's the total number? 1.5 million shares. So we've issued 1.5 million shares to satisfy the bond when we get it put. So that's what's happened. That's factual. Your first question is, we did a transaction with Saks Global as part of their funding for buying Neiman Marcus. Now, as part of that, we decided we weren't just going to make that investment unless we got compensated for it. So in case it blew up, we would be whole.
Speaker #1: Sure. So let me answer the second first. We have gotten some redemption notices, and we've been issuing shares. Brian, what's the
Speaker #1: Total number? So, what, 1.5 million shares. We've issued 1.5 million shares to satisfy the bond when we get it put. So that's what's happened.
Speaker #1: That's factual. Your first question is, we did a transaction with Saks Global as part of their funding for buying Neiman Marcus. Now, as part of that, we decided we weren't just going to make that investment unless we got compensated for it.
Speaker #1: So in case it blew up, we would be home. And so we got the right to terminate two leases. We got two buildings. And very importantly, and I'm sure you're familiar with REAs, but throughout our whole entire portfolio with Saks, and Neiman, and Off 5th, we got the right to build what we want, so we don't have to go and get their approval.
David Brown: And so we got the right to terminate two leases. We got two buildings. And very importantly, and I'm sure you're familiar with REAs, but throughout our whole entire portfolio with Saks and Neiman and all fifth, we got the right to build what we want so we don't have to go get their approval. In addition, we got the right to take that investment and convert it into a company that's being run by Authentic Brands Group that owns the IP, not e-commerce, not stores, but owns the IP for Saks, Neiman, Bergdorf. So at the end of the day, we felt like we made a good trade. With that said, we've written off our investment at the end of the fourth quarter. But again, we got the right to build, which can keep you from doing what you want with REAs for years and years.
And so we got the right to terminate two leases. We got two buildings. And very importantly, and I'm sure you're familiar with REAs, but throughout our whole entire portfolio with Saks and Neiman and all fifth, we got the right to build what we want so we don't have to go get their approval. In addition, we got the right to take that investment and convert it into a company that's being run by Authentic Brands Group that owns the IP, not e-commerce, not stores, but owns the IP for Saks, Neiman, Bergdorf.
Speaker #1: In addition, we got the right to take that investment and convert it into a company that's being run by Authentic Brands Group, that owns the IP—not e-commerce, not stores.
Speaker #1: But owns the IP for Saks, Neiman, Bergdorf. So at the end of the day, we felt like we made a good trade. With that said, we've written off our investment at the end of the fourth quarter.
So at the end of the day, we felt like we made a good trade. With that said, we've written off our investment at the end of the fourth quarter. But again, we got the right to build, which can keep you from doing what you want with REAs for years and years.
Speaker #1: So, but again, we got the right to build, which can keep you from doing what you want with REAs for years and years. We got two buildings.
David Brown: We got two buildings. We got the right to terminate two leases if they were in monetary default, which they are. And then the upside is we own the IP. So in my personal belief, we're ahead of the game, but we went ahead and wrote off our investment. Very helpful. Thank you. Yeah. Good question. And thanks for asking. Our last question comes from Ronald Kamdem with Morgan Stanley. You may proceed with your question. Hey. I just had a quick one putting some of the stuff that came up in the call earlier. Just going back to the domestic property NOI assumptions for this year versus last year, just talking through the occupancy, the releasing spreads, the bad debt, just putting it all together, how it compares versus last year would be helpful. Thank you. It's Brian.
We got two buildings. We got the right to terminate two leases if they were in monetary default, which they are. And then the upside is we own the IP. So in my personal belief, we're ahead of the game, but we went ahead and wrote off our investment.
Speaker #1: We got the right to terminate two leases, if they were in monetary default, which they are. And then the upside is we own the IP.
Speaker #1: So, in my personal belief, we're ahead of the game, but we went ahead and wrote off our investment.
Rich Hightower: Very helpful. Thank you.
Speaker #9: Very helpful. Thank
Speaker #9: you. Yeah.
David Simon: Yeah. Good question. And thanks for asking.
Speaker #1: Good question, and thanks for asking.
Operator: Our last question comes from Ronald Kamdem with Morgan Stanley. You may proceed with your question.
Speaker #8: Our last question comes from Ronald Camden with Morgan Stanley. You may proceed with your question.
Ronald Kamdem: Hey. I just had a quick one putting some of the stuff that came up in the call earlier. Just going back to the domestic property NOI assumptions for this year versus last year, just talking through the occupancy, the releasing spreads, the bad debt, just putting it all together, how it compares versus last year would be helpful. Thank you.
Speaker #10: Hey, I just had a quick one, putting some of the stuff that came up in the call earlier. Just going back to the domestic property NOI assumptions.
Speaker #10: For this year versus last year, just talking through the occupancy, the releasing spreads, the bad debt—just putting it all together—how it compares versus last year would be helpful.
Speaker #10: Thank you.
Brian McDade: It's Brian. I think if you look, we've now said at least 3% domestic NOI for about four years, and it's outperformed that. Ultimately, it's going to be all of the things that we've talked about on this call that will drive the performance of domestic store NOI above where we have guided to. Ultimately, it's going to be the upside from occupancy, upside from leasing, and a variety of other parts of the business that will contribute as it has this year and the past several years.
Speaker #1: Ron, it's Brian. I think if you look, we've now said at least 3% domestic NOI for about four years, and it outperformed that. Ultimately, it's going to be all of the things that we've talked about on this call that will drive the performance of domestic store NOI.
David Brown: I think if you look, we've now said at least 3% domestic NOI for about four years, and it's outperformed that. Ultimately, it's going to be all of the things that we've talked about on this call that will drive the performance of domestic store NOI above where we have guided to. Ultimately, it's going to be the upside from occupancy, upside from leasing, and a variety of other parts of the business that will contribute as it has this year and the past several years. Great. That's it for me. Thank you. Thank you, Brian. All right. Thank you, everybody. Sorry. Go ahead. Very good questions. We will talk to you soon. Brian and Tom always welcome your thoughts and insight. Thank you. Ladies and gentlemen, thank you for your participation. This concludes today's conference. You may disconnect your lines and have a wonderful day.
Speaker #1: Above where we have guided you from. Ultimately, it's going to be the upside from occupancy, upside from leasing, and a variety of other parts of the business that will contribute as it has this year and in the past several years.
Brian McDade: Great. That's it for me. Thank you.
Speaker #10: Right. That's it for me. Thank you.
David Simon: Thank you. All right. Thank you, everybody. Sorry. Go ahead. Very good questions. We will talk to you soon. Brian and Tom always welcome your thoughts and insight. Thank you.
Speaker #1: Thank you, Brian.
Speaker #1: All right. Thank you, This time.
Speaker #1: All right. Thank you this time, everybody. Sorry. Very good.
Speaker #8: Go ahead.
Speaker #1: Questions. And we will talk to you soon. And Brian and Tom always welcome your thoughts and insight. Thank you.
Speaker #1: questions. And we will talk to you soon. And Brian and Tom always welcome your thoughts and insight. Thank you. Ladies and
Operator: Ladies and gentlemen, thank you for your participation. This concludes today's conference. You may disconnect your lines and have a wonderful day.
