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Simon (SPG) Announces Plan to Transform Former Sears Stores
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Simon Property Group Inc. (SPG - Free Report) recently announced the company’s substantial redevelopment program at five properties. This move will help the retail REIT transform the former Sears stores and draw more traffic to these malls to benefit the existing retailers.
The properties included in the refurbishment plan are Brea Mall (Brea, CA), Burlington Mall (Burlington, MA), Midland Park Mall (Midland, TX), Ocean County Mall (Toms River, NJ), and Ross Park Mall (Pittsburgh, PA).
Per the plan, Brea Mall will have additional mixed uses. This comprises a new three-story, 120,000-square-foot Life Time Athletic healthy living, healthy aging, healthy entertainment destination, residential, entertainment, restaurants and new retail brands. In the Burlington Mall, the spaces will be revamped into new shops and restaurants, while in Ross Park Mall, the refurbishment plan includes a new dining hall, new retailers, restaurants, entertainment on three levels.
Further, the Ocean County Mall plan comprises inclusion of new stores and transformation into dining and fitness spaces. At the Midland Park Mall, renovations include additions of two new restaurants and a new bigger Dillard's store, along with a new-to-the-market large format retailer, per the company’s press release.
Notably, for the past few years, mall traffic has been plagued with challenges thanks to the shift in shopping patterns, with e-retail taking precedence, keeping retail REITs on tenterhooks. This has shrunk demand for retail real estate space, as changing shopping patterns are compelling retailers to reconsider their footprint, and eventually opt for store closures or file bankruptcies.
This has been a prevailing concern for retail REITs like Simon Property, GGP Inc. , Kimco Realty Corp. (KIM - Free Report) , Macerich Company (MAC - Free Report) and others.
Amid these, Simon Property has been making concerted efforts focused on overhauling its properties and increasingly adopting omni-channel strategies. These will help the company counter retail blues and make its shopping malls more alluring.
In line with this, the company is initiating programs and events, as well as entering into several partnerships for upgrading services and amenities provided to its consumers. In fact, over the past five years, this retail REIT invested more than $5 billion in development projects, and further intends to invest around $1 billion annually through 2018 for development and redevelopment projects.
At the end of fourth-quarter 2017, the company had redevelopment and expansion projects, including the addition of new anchors, in progress at 25 properties across the United States, Canada and Asia. With such a huge pipeline, Simon Property is well poised to effectively leverage the improving spending habits of wealthier customers amid a strengthening economy.
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Simon (SPG) Announces Plan to Transform Former Sears Stores
Simon Property Group Inc. (SPG - Free Report) recently announced the company’s substantial redevelopment program at five properties. This move will help the retail REIT transform the former Sears stores and draw more traffic to these malls to benefit the existing retailers.
The properties included in the refurbishment plan are Brea Mall (Brea, CA), Burlington Mall (Burlington, MA), Midland Park Mall (Midland, TX), Ocean County Mall (Toms River, NJ), and Ross Park Mall (Pittsburgh, PA).
Per the plan, Brea Mall will have additional mixed uses. This comprises a new three-story, 120,000-square-foot Life Time Athletic healthy living, healthy aging, healthy entertainment destination, residential, entertainment, restaurants and new retail brands. In the Burlington Mall, the spaces will be revamped into new shops and restaurants, while in Ross Park Mall, the refurbishment plan includes a new dining hall, new retailers, restaurants, entertainment on three levels.
Further, the Ocean County Mall plan comprises inclusion of new stores and transformation into dining and fitness spaces. At the Midland Park Mall, renovations include additions of two new restaurants and a new bigger Dillard's store, along with a new-to-the-market large format retailer, per the company’s press release.
Notably, for the past few years, mall traffic has been plagued with challenges thanks to the shift in shopping patterns, with e-retail taking precedence, keeping retail REITs on tenterhooks. This has shrunk demand for retail real estate space, as changing shopping patterns are compelling retailers to reconsider their footprint, and eventually opt for store closures or file bankruptcies.
This has been a prevailing concern for retail REITs like Simon Property, GGP Inc. , Kimco Realty Corp. (KIM - Free Report) , Macerich Company (MAC - Free Report) and others.
Amid these, Simon Property has been making concerted efforts focused on overhauling its properties and increasingly adopting omni-channel strategies. These will help the company counter retail blues and make its shopping malls more alluring.
In line with this, the company is initiating programs and events, as well as entering into several partnerships for upgrading services and amenities provided to its consumers. In fact, over the past five years, this retail REIT invested more than $5 billion in development projects, and further intends to invest around $1 billion annually through 2018 for development and redevelopment projects.
At the end of fourth-quarter 2017, the company had redevelopment and expansion projects, including the addition of new anchors, in progress at 25 properties across the United States, Canada and Asia. With such a huge pipeline, Simon Property is well poised to effectively leverage the improving spending habits of wealthier customers amid a strengthening economy.
Simon Property has a Zacks Rank #3 (Hold). The stock has depreciated 6.9% in the past three months which is narrower than its industry’s decline of 8.0%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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