Simon Property Group ( SPG Quick Quote SPG - Free Report) recently teamed up with Mango and will assist the latter’s growth strategy in the United States with the launch of stores in 2021. The stores will feature a variety of Women's, Men's and Kid's collections. The move comes as Simon is now focused on tapping growth opportunities by assisting digital brands enhance their brick-and-mortar presence. Notably, investments in wholesale and e-commerce distribution have been on Mango’s agenda so far and now, the company is aimed at boosting its physical presence. Therefore, with a vast footprint and solid brand name in the retail real estate space, Simon Property is banking on such growth scopes. Simon and Mango are working together to open three stores in the first quarter of 2021. The stores will be unveiled at Roosevelt Field, Menlo Park Mall and Dadeland Mall, and boost the expansion of Mango's “Mediterranean brand to the American consumer”. Amid the retail apocalypse, adoption of an omni-channel strategy, as well as successful tie-ups with premium retailers have been a saving grace for Simon Property. Moreover, in light of the pandemic, the omni-channel business model has become all the more essential among several store retailers, while digital brands are focusing on enhancing their brick-and-mortar presence, and playing key roles in meeting orders. Notably, in November, the company collaborated with Narvar to facilitate easy drop-off returns for retail brands. Specifically, the service lets consumers make quick drop-off returns from roughly two dozen brands at a participating Simon location. In addition, reliance on value-creating opportunities and the purchase of bankrupt retailers have been on the agenda for Simon Property in recent years and mall owner are committed to the same. This opens new growth avenues as the company can utilize such brands across its brick-and-mortar footprint. Nonetheless, businesses of physical stores widely depend on customer traffic but consumers are avoiding crowded public spaces due to the pandemic and increasingly opting for online purchases. This, in turn, is taking a huge toll on tenants’ liquidity, thereby making it difficult to meet their rental obligations. As a result, retail REITs, which have already been battling against store closures and bankruptcy issues, are feeling the heat. Apart from Simon Property, this is affecting other retail REITs as well, including Macerich ( MAC Quick Quote MAC - Free Report) , Kimco ( KIM Quick Quote KIM - Free Report) and Federal Realty ( FRT Quick Quote FRT - Free Report) among others. Per the company’s third-quarter earnings release, Simon Property’s rent collections from U.S. retail portfolio, including rent deferrals amounted to roughly 78% of its net billed rents for the second quarter and 85% for the third quarter. Also, the company’s third-quarter results reflected the pandemic’s adverse impacts on its domestic and international operations, with an impact of $1.10 per share, mainly on reduced revenues. Shares of this Zacks Rank #5 (Strong Sell) company have depreciated 43.8% so far in the year, wider than its industry’s decline of 15%.
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