Inquired about potential changes to strategy/execution post-leadership transition and capital allocation priorities (acquisitions, buybacks, development, dividends).

Eli Simon affirmed 'business as usual' with no strategic changes. He detailed capital allocation: $1.06B current development at 9% yield, $1B potential starts this year, $3B shadow pipeline; opportunistic acquisitions; share buybacks expected to continue; dividend growth is a priority. He emphasized $1.6B free cash flow after dividends. “But at the end of the day, if you think about the business, we're generating $1.6 billion or so of free cash flow after dividends. And so we have tremendous opportunities and tremendous things to do with that.”

Asked about consumer resilience, changes in shopping/spending, and data on Gen Z consumers.

Eli Simon noted broad-based sales growth (6.5% comp), strong performance in luxury, jewelry, athleisure, and juniors. He identified food and beverage as slightly softer. He highlighted the Gen Z consumer as a focus, with brands targeting them showing strong growth. Brian McDade added that Gen Z is the centerpiece of their 'Meet Me @themall' campaign. “I think the way I look at it is you can see it in the sales, you can see it in these customers or in these retailers that are targeting. They are all growing. They want more space and their sales are proving that they're resonating with that customer.”

Asked about new/renewal lease spreads and whether the portfolio is reaching structural occupancy limits (96% leased).

Eli Simon stated renewal spreads are in the mid-single digits. New leases are 20-25% above last year's new leases, with 'new business brands' outperforming by another 10%+. On occupancy, he said they could reach 97-97.5% but prioritize long-term decisions over short-term occupancy metrics, focusing on cash flow growth (5.5% NOI growth ex-Taubman). “On the new deals, what I look at is the new leases we are signing are 20-plus percent, 20%, 25% above new leases last year.”

SPG

Simon Property Group (SPG) Q1 FY26 earnings call: guidance and Q&A

Earnings call· Mar 2026 (Q1 FY26)· Real Estate· May 11, 2026

Source: earnings call transcript

Executive summary

Simon Property Group Q1 FY26 — Strong FFO Growth and Robust Development Pipeline

Simon Property Group delivered strong Q1 FY26 results, exceeding plans with robust FFO and NOI growth driven by occupancy gains and increased retailer sales. Management highlighted broad-based tenant demand and a significant development pipeline, while maintaining a disciplined capital allocation strategy focused on accretive investments and shareholder returns. The company continues to invest in its portfolio and integrate recent acquisitions, positioning for continued long-term growth.

Highlights

Real estate FFO grew 7.5% year-over-year to $3.17 per share, exceeding plan.
Domestic property NOI increased 6.7% year-over-year, with portfolio NOI also up 6.7% at constant currency.
Malls and Premium Outlets occupancy reached 96% (up 10 bps YoY), while The Mills occupancy was 99.2% (up 80 bps YoY).
Signed over 1,100 leases totaling 4.7 million square feet, with approximately 25% being new deals.
Retailer comparable sales grew 6.5% for the first quarter, with sales per square foot at $819, up 11.8%.

Concerns

Higher interest expense and lower interest income combined for a $0.05 per share drag year-over-year on FFO.
Reported FFO of $2.91 per share includes $0.10 per share of accelerated stock compensation expense.
Tourist markets, such as Woodbury, showed softer sales growth (2.5% comp) due to reduced international travel.
The food and beverage segment experienced flat comparable sales performance.

Guidance & targets

Category	Target	Timeline	Confidence
Full-year 2026 Real Estate FFO per share	$13.10 to $13.25 per share high materiality	Full-year 2026 · FY26	High

SPG operating KPIs by quarter

SPG operating KPIs stated on its earnings calls, by fiscal quarter
KPI	Dec 2024 Q4 FY24	Mar 2025 Q1 FY25	Jun 2025 Q2 FY25	Sep 2025 Q3 FY25	Dec 2025 Q4 FY25	This call Mar 2026 Q1 FY26	Jun 2026 Q2 FY26	Change vs prior quarter
Square feet Leases signed	6.1M sq ft We signed more than 1,500 leases for 6.1 million square feet in the quarter. Source: earnings call transcript	5.1M sq ft+ We signed 1,300 leases for more than 5.1 million square feet in the quarter. Source: earnings call transcript	3.6M sq ft+ We signed approximately 1,000 leases for more than 3.6 million square feet in the quarter, with approximately 30% of our leasing activity for the quarter on new deals. Source: earnings call transcript	~4M sq ft Retailer demand remains strong as we signed over 1,000 leases totaling approximately 4 million square feet during the quarter. Source: earnings call transcript	4.4M sq ft+ 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. Source: earnings call transcript	4.7M sq ft+ During the first quarter, we signed more than 1,100 leases totaling over 4.7 million square feet. Source: earnings call transcript	4.8M sq ft+ During the second quarter, we signed more than 1,200 leases totaling over 4.8 million square feet. Source: earnings call transcript	—
Occupancy rate Malls and Premium Outlets	96.5% Malls and outlet occupancy at the end of the fourth quarter was 96.5%, an increase of 70 basis points compared to the prior year. Source: earnings call transcript	95.9% Malls and premium outlet occupancy at the end of the quarter was 95.9%, an increase of 40 basis points compared to the prior year. Source: earnings call transcript	96% The Malls and Premium Outlets ended the second quarter at 96.0% occupancy, up 10 basis points sequentially and 40 basis points year-over-year. Source: earnings call transcript	96.4% The Malls and Premium Outlets ended the third quarter at 96.4% occupancy, an increase of 40 basis points sequentially and 20 basis points year-over-year. Source: earnings call transcript	96.4% Malls and Premium Outlets ended the year at 96.4%. Source: earnings call transcript	96% Malls and Premium Outlet occupancy at the end of the first quarter was 96%, an increase of 10 basis points year-over-year. Source: earnings call transcript	96% Malls and Premium Outlets occupancy at the end of the second quarter was 96%, flat compared to the first quarter and year-over-year, a result that reflects the depth of retail demand as we absorbed approximately 1 million square feet of retailer bankruptcy-related space returned during the quarter and successfully relet. Source: earnings call transcript	0 pt
Occupancy rate The Mills	98.8% The Mills occupancy was 98.8%, an increase of 1% and is at a record level. Source: earnings call transcript	98.4% The mills occupancy was 98.4%, an increase of 70 basis points compared to the prior year. Source: earnings call transcript	99.3% The Mills achieved a record 99.3% occupancy, an increase of 90 basis points sequentially and 110 basis points from the prior year. Source: earnings call transcript	99.4% The Mills achieved a 99.4% occupancy, an increase of 10 basis points sequentially and 80 basis points from the prior year. Source: earnings call transcript	99.2% Occupancy in the Mills ended at 99.2%. Source: earnings call transcript	99.2% The Mills occupancy was 99.2%, an increase of 80 basis points year-over-year. Source: earnings call transcript	98.8% The Mills occupancy was 98.8%. Source: earnings call transcript	-0.4 pt

Operating figures the company stated on at least two of the calls shown, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Orderbook & backlog

Development pipeline under construction $1.06 billion Q1 FY26

Our share of net cost for projects under construction at 29 centers.

Development pipeline (potential starts this year) $1 billion Q1 FY26

Additional projects with the ability to start construction this year.

Development pipeline (future starts) $3 billion Q1 FY26

Projects in the pipeline that could start over the next several years.

Deals & partnerships

TRG acquisition

Acquisition of remaining interests in Taubman Realty Group.

Klépierre equity stake

Owns approximately 59 million shares of Klépierre's common stock, representing 20.7% ownership.

CMBS market debt financing 5-year

Refinancing of the Shops at Crystals via CMBS loan.

Various acquisition

Acquisitions last year included mall outlets in Italy, Brickell City Centre in Miami, and Phillips Place in Charlotte.

Capital programs

Current Development & Redevelopment Projects underway $1.06 billion

Funding: internally generated cash flow

Benefit:blended yield of 9%

Projects at 29 centers. Approximately 50% of net cost for mixed-use projects, including 1,200 multifamily residential units and 400 hotel keys.

Taubman Asset Reinvestment Program announced over $250 million

Start: later this year

Benefit:enhance assets, improve margins, leverage leasing expertise

Investment across Green Hills, International Plaza, and Cherry Creek to freshen up and make centers better.

Risks & headwinds

Higher interest expense Q1 FY26

$0.05 per share drag year-over-year on FFO

Lower interest income Q1 FY26

$0.05 per share drag year-over-year on FFO (combined with interest expense)

Accelerated stock compensation expense Q1 FY26

$0.10 per share reduction in reported FFO

Softer performance in tourist markets due to reduced international travel Q1 FY26

Woodbury comp sales 2.5% vs. portfolio average 6.6%

Flat comparable sales in food and beverage segment Q1 FY26

flat from a comp perspective

Ongoing interest expense headwinds from debt refinancing Full-year 2026

original $0.25 to $0.30 per share headwind for full-year 2026, now gravitating closer to $0.25

Mitigation:active in various debt markets (CMBS, life, unsecured), tight spreads

Q&A highlights

Asked about the company's pricing power given strong retailer demand and growth momentum for upcoming lease expirations.

Eli Simon stated they don't have 'leverage' or 'pricing power' but highlighted significant, broad-based demand across all categories and centers. He noted retailers are proactively discussing 2027-2029 expirations, indicating strong interest in their space.

“So we're really seeing broad-based demand across all our centers, not just sort of the top fortress centers, but really across the portfolio.”

asked by Samir Khanal, Bank of America · answered by Eli Simon

2 min read 6 chapters

Detailed narrative

Strong Q1 Performance and Retailer Demand

Simon Property Group exceeded its Q1 2026 plan, driven by occupancy gains, increased shopper traffic, and higher retailer sales. The company signed over 1,100 leases totaling 4.7 million square feet, with approximately 25% being new deals, and has completed over 75% of its 2026 expirations.

Retailer demand is broad-based across categories and platforms, including legacy brands, new direct-to-consumer entrants, luxury, and regional businesses, indicating strong interest in Simon's physical spaces.

Development and Redevelopment Pipeline

The company has $1.06 billion in projects under construction at 29 centers, with a blended yield of 9%. This includes mixed-use projects with 1,200 multifamily residential units and 400 hotel keys. An additional $1 billion in projects could start this year, and a further $3 billion is in the pipeline for the next several years, all funded by internally generated cash flow.

Management emphasizes flexibility and discipline in capital allocation for these accretive projects, which enhance the portfolio and drive long-term growth.

Capital Allocation Strategy

Simon maintains a consistent capital allocation strategy, evaluating development, acquisitions, share repurchases, and dividends. The company generated $1.6 billion in free cash flow after dividends, providing significant flexibility. While share repurchases were slower in Q1, the company expects to remain active, aiming to buy back shares issued for the Taubman transaction.

Dividends continue to grow, with a 7.1% increase announced for Q2, reflecting a commitment to shareholder returns.

Consumer Trends and Sales Growth

Malls and Premium Outlets saw sales of $819 per square foot, up 11.8%, with comparable sales growth of 6.5% for Q1. Sales growth was broad-based across categories like luxury, jewelry, athleisure, and juniors, indicating strong consumer resilience. The Gen Z consumer is a key focus, with marketing efforts and brand curation tailored to this demographic, driving strong engagement and sales, although food and beverage sales were flat.

Taubman Integration and Reinvestment

The integration of Taubman assets is fully completed from a corporate perspective. Simon is now focused on reinvesting in these centers, with over $250 million planned for projects at Green Hills, International Plaza, and Cherry Creek. These investments aim to enhance the assets, improve margins through operational efficiencies, and leverage Simon's leasing expertise, with the goal of making them even better performing centers and driving cash flow growth.

Other Platform Investments (OPI)

The OPI segment, comprising Catalyst (former SPARC and JCPenney), Rue La La/Gilt, and Jamestown, is performing at or above plan. Simon views these as strategic investments providing insights into retailer operations and consumer trends, particularly in marketing and customization. The company remains an opportunistic seller but is not actively planning monetization, with all platforms properly capitalized and contributing to overall business intelligence.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.