Reis in the News
By Lauren Thomas
Source: CNBC – The biggest mall owner in the US ‘can’t guarantee’ there won’t be more retail wreckage this year
The biggest mall owner in the country is anticipating the pace of retail store closures will slow after a nasty start to the year. But its CEO won’t make any promises.
“I think most of the bad news is behind us,” Simon Property Group CEO David Simon told analysts on a post-earnings conference call Tuesday, referring to store closures and retail bankruptcies. “But I can’t guarantee it.”
Simon shares were down more than 2%, after the real estate investment trust reported first-quarter funds from operations — a closely watched metric in the industry — of $1.08 billion, or $3.04 per share, compared with $1.03 billion, or $2.87 a share, a year earlier. That was slightly below expectations, BTIG analyst Jim Sullivan said.
Mall vacancy rates, an effect of the closures, climbed during the first quarter to 9.3% from 9% in the fourth quarter of 2018, according to real estate research firm Reis. This is the highest vacancy rate the firm has tracked since the third quarter of 2011, when it was 9.4%.