Simon Property Group Inc (SPG.N): Strong 202Q2 Results and Raised Guidance; Fundamentals Continue to Improve

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11 Aug 2026 06:27:38 ET │ 13 pages

Simon Property Group Inc (SPG.N)

Strong 2Q26 Results and Raised Guidance; Fundamentals Continue to

Improve

CITI'S TAKE

SPG’s 2Q26 real estate FFO of $3.29 was +7c (+2.2%) ahead of FactSet

consensus and –3c (-0.9%) below Citi’s estimate. However, strong

underlying fundamentals supported an +8c (+0.6%) increase to SPG’s real

estate FFO guidance at the midpoint. In addition, the leasing pipeline

remains robust and the 4.8msf of 2Q leasing improved sequentially

(4.7msf in 1Q) and sales per square foot also accelerated to $838/SF vs.

$819/SF last quarter. Furthermore, tenants are already signing deals 1-2

years ahead of expiry vs. ~1 year ahead historically. Separately, the

redevelopment pipeline remains robust with over ~$1.1B underway and a

~$4B shadow pipeline supported by $9.3B of liquidity and significant

annual FCF. Overall, mall leasing fundamentals continue to strengthen,

and we believe SPG is well-positioned to benefit through occupancy gains

and premium yields on redevelopment. Nevertheless, valuation seems fair

at an estimated 6% implied cap rate vs. 6.8% for MAC.

2Q Earnings and Guidance — SPG's reported real estate FFO of $3.29 was +7c

(+2.2%) ahead of consensus and –3c (-0.9%) below Citi. Headline FFO was $3.12

with the +17c difference vs. Real Estate FFO primarily due to: 1) a -1c deduct for other

platform investments, net of tax; 2) a +3c add-back for net losses on asset

disposals; and 3) a +15c add-back for unrealized losses on equity instruments. SPG

increased 2026 real estate FFO guidance by +8c (+0.6%) at the MP to $13.20$13.30 from $13.10-$13.25. The upwardly revised $13.25 MP is now +16c (+1.2%)

above the Street at $13.09 and +2c (+0.2%) above Citi at $13.23.

Neutral

Price (10 Aug 26 16:00)

US$220.55

Target price

US$205.00

Expected share price return

-7.1%

Expected dividend yield

4.0%

Expected total return

-3.1%

Market Cap

US$71,522M

Nick JosephAC

Craig Mailman

Nick Kerr

Fundamentals — Strong leasing demand, improving shopper traffic, and

accelerating sales per square foot ($838/SF vs. $819/SF in 1Q) were tailwinds for 2Q

results that helped drive a sequential increase in leasing volume to 4.8msf vs.…