Simon Property Group 1Q15 Earnings Call Notes

Occupancy 95.8%, leasing activity remains strong

“Occupancy was 95.8%, leasing activity remains strong and healthy. The malls and premium outlets recorded leasing spreads of $11.19 per square foot, an increase of 18.9%”

Feeling good about buying back stock at these levels

“We couldn’t buy any stock back because we were in our blackout period when the announcement came. And as I look at other companies and their valuation and I look at ours, and our growth prospects and our track record, I continue to think we are extremely well positioned. As I look at history year-after-year, quarter-after-quarter and all that we’ve got going on, look at our valuation compared to our peer group and I feel very comfortable that we are a very strong and good investment.’

Storng dollar making for increased volatility in tourist markets

“I would tell you that it’s just really volatile right now on some of those tourist markets where there is a good month, a good week, and then there is a bad month and a bad week. So it kind of balances out, but I would say it’s safe to say that the strong dollar is affecting to some extent sales in some of the really highly international assets that we have but nothing that’s going to change our financial profile or earnings or any of that. But it is a lot more volatile, you hear occasionally in South Florida a little bit, you hear – we haven’t seen anything at Woodbury but I’ve heard a lot in New York, now we have no exposure there but you hear and then when I say hear, I’m hearing from the retailers, but with something to pay attention to it.”

The consumer is still cautious I think

“I’d still say generally we are still dealing with a cautious consumer, it’s safe to say and it’s volatile. So the comment I heard about the tourism also applies to just the domestic consumer as well. The patterns of the consumer are tougher to predict right now. I still think there is – confidence is getting better, but there is still a lot of debt being reduced and it’s still there is a good month, good week, and then a bad month, a bad week and the pattern is sloppy enough but it’s certainly not getting busters.”

Weather expense was even worse than last year

“I probably shouldn’t mention it but we had another awful winter in northeast. For those of you in Boston only, we have a lot of exposure in northeast. Believe it or not, our snow expense was higher this year than last year across the portfolio. So we still had to deal with a little bit of the weather, but we are dealing with a cautious consumer and we are delivering – the good news is, we are delivering results in that environment. That’s all we can do.”

Listing growth retailers

“the tenant that has the broadest footprint in our portfolio is L Brands, with Victoria’s Secret and they are doing great results, and they are growing and they are expanding and they are adding things to the Victoria’s Secret stores. But we are doing with a lot of international retailers that people haven’t — DAVIDsTEA has come down, we are growing UNIQLO, we are growing H&M, we are growing Sephora, and we are growing Altar’d State, which is a great retailer that has got a significant growth platform.”