Simon Property Group (SPG)
Bienes raíces (REIT minorista)
Simon Property Group is the largest operator of premium malls and outlet centers in the United States, with 254 properties across three continents and a 20.7% stake in Klépierre. Stable occupancy at 96.0%, base minimum rent growing 6.3% year over year, and tenant sales up 13.9% point to a wide, stable moat. At $220 the stock trades at 17× on adjusted FFO — Fairly valued, with a projected 5-year total return of +10%.
- Price
- $220.20
- Intrinsic value (5y, base)
- $291
- Total annual return (5y)
- 9.9%
- Status (nominal)
- Fairly valued
- Margin of safety
- +21%
The essentials
- Real Estate FFO per share grew 7.5% year over year in the first half of 2026, and the company raised full-year guidance again to $13.20-$13.30 per share.
- Occupancy held stable at 96.0% and base minimum rent per square foot rose 6.3% year over year, with tenant sales per square foot up 13.9% over the trailing twelve months.
- Investment-grade balance sheet (S&P A, Moody's A3, both with stable/positive outlook) and a fixed-charge coverage ratio of 4.7x, well above the required minimum of 1.5x.
Intrinsic value — two valuation methods
Total return at 5 years: 9.9%/year = 5.7% appreciation + 4.2% dividend. The target price ($291) is ex-dividend; the $52 in dividends collected over 5 years are added separately.
By both methods, the value today (DCF $387 · Multiples $279) exceeds the market price ($220).
Pillars of the analysis
The verdict — today vs 5 years
Today — fairly valued: at $220 trades ~21.0% below its value discounted to today (~$279); the discount is positive but does not reach the margin of safety we require (≥38%).
At 5 years — En valor: the target price ($291) plus dividends yield between the 4% floor and the 10% average return — a reasonable return, though without the margin of a great investment.
The bridge: the return at 5 years exceeds the risk-free rate (4.5%) — but the discount does not reach the required margin of safety (≥38%). To require a 15% annual return, it would need to be bought at ~$179.
Thesis
The business
Simon Property Group is the largest operator of premium malls and outlet centers in the United States, with a wide moat built on scale, the quality of its locations, and the difficulty of reproducing assets of this nature. Stable occupancy at 96.0%, base rent up 6.3%, and tenant sales up 13.9% over the trailing twelve months point to a business in good operating shape, with an investment-grade balance sheet that supports its access to capital.
The valuation
It is valued on P/adjusted Real Estate FFO, the FFO metric the company itself guides and reconciles every quarter. With an exit multiple within the reit archetype's 15x-20x band, the base scenario projects a 5-year value of $291 per share, versus a current price of $220.
The margin of safety
It trades close to intrinsic value, far from the required margin of safety. The base scenario implies an annualized 5-year total return of +10%, resulting in a verdict of Fairly valued.
What to watch
The central disconfirmer is an acceleration in the deterioration of discretionary consumer spending that reduces tenant sales and, with them, variable rent and occupancy. In parallel, it is worth monitoring the continuity of capital allocation discipline under Eli Simon's new leadership following David Simon's death in March 2026.
Educational / informational. Does not constitute investment advice.