Simon Property Group Inc.'s (SPG) first-quarter profit surged
from prior-year levels that were hurt by debt-extinguishment
charges as the real-estate investment trust reported higher
occupancy rates and its tenants improved sales.
The results beat Wall Street expectations. The REIT raised its
2011 per-share FFO forecast to $6.55 to $6.65, up from its February
forecast of $6.45 to $6.60.
Simon, the nation's largest shopping mall owner, is viewed as
one of the healthiest REITs with an interest in more than 300
properties. Higher rents and improving occupancy have bolstered
profits lately while competitors struggle.
Earlier this week, rival General Growth Properties Inc.'s (GGP)
latest first-quarter earnings dropped sharply as its FFO missed
Wall Street expectations.
Simon reported a first-quarter profit of $180.2 million, or 61
cents a share, up from $15 million, or 3 cents a share, a year
earlier. Excluding 48 cents in debt-extinguishment impacts a year
earlier, adjusted FFO rose to $1.61 from 94 cents as revenue rose
10% to $1.02 billion.
Analysts polled by Thomson Reuters most recently forecast FFO of
$1.54 and revenue of $1 billion.
Combined occupancy at Simon's U.S. regional malls and premium
outlets rose to 92.9% from 92.2% a year ago and 94.2% at the end of
the previous quarter. Average rents climbed 1.4% for the year,
while comparable-store sales per square foot rose 8.2% from a year
ago.
Shares closed Thursday at $114.95 and were inactive premarket.
The stock has gained 24% over the past year.
-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909;
Andrew.FitzGerald@dowjones.com