Aug 10, 2026 earnings call — Leasing demand, sales growth and higher FFO guidance
Raised 2026 real estate FFO guidance to $13.20 to $13.30 per share and reported second-quarter real estate FFO of $1.25 billion or $3.29 per share.
Revenue $1.7B (est $1.6B) · EPS $1.49 (est $1.64)
Key quotes
"During the second quarter, we signed more than 1,200 leases totaling over 4.8 million square feet."
"Importantly, total sales volume increased 6.6% over the trailing 12 months and 7.6% in the quarter, with comparable sales growth of 5.7% for the second quarter."
"At the end of the quarter, we had development projects underway across all platforms with our share of the net cost totaling $1.07 billion at a blended yield of 9%."
Analyst Q&A 14
tenant improvement spending
Q (Caitlin Burrows · Goldman Sachs): She asked how tenant improvement (TI) spending affects cash flow and whether SPG will cut TIs given strong leasing demand.
A: Eli said TI levels are driven by tenant demand, available space and tenant mix, noting their pipeline is up 26% from this time last year. He emphasized they are reinvesting heavily in centers to grow cash flow and dividends per share.
"That's a function of demand for the tenants and -- demand from the tenants and demand for the space and the supply of available space." — Eli Simon (CEO)
new lease rent levels
Q (Michael Griffin · Evercore): He asked whether expiring in-line rents around $60 to $65 are being replaced by leases signed in the mid-70s (or $78) as leases roll.
A: Eli said year-to-date new leases have been signed around $78. He added many expiring leases will renew (mid-single digits) and replacements are selected for the right retailer fit, so it is not a simple one-year jump from $60–$65 to $78.
"So if you look at year-to-date, I think we've signed new leases at $78 more or less." — Eli Simon (CEO)
how to grow NOI and earnings
Q (Samir Khanal · BofA): He asked which levers will drive NOI and earnings growth over the next 12 to 18 months given occupancy near 96%.
A: Eli said growth will come from modest additional occupancy gains, retenanting lower performers with higher-paying tenants, and development activity. He noted they have $1 billion in the ground, expect $600 million plus to start by year-end, and those developments are generating about 9% returns.
"We're generating 9% return on those investments, which is obviously a very healthy number." — Eli Simon (CEO)
replacing bankrupt Saks space
Q (Michael Goldsmith · UBS): He asked who returned the 1 million square feet, at what rents those boxes were paying, and whether replacements are signing at similar or higher rents.
A: Eli said the returned 1 million square feet was largely Saks Off Fifth outlet space. He said the boxes had been paying $18 million in rent and current deals will materially exceed that; they expect to turn the $18 million into $44 million, with most benefit hitting 2027 since boxes were returned mid-May.
"But we'll basically take the $18 million and turn it into $44 million." — Eli Simon (CEO)
new tenant types and watch list
Q (Greg McGinniss · Scotiabank): He asked which tenants or categories SPG is adding that resonate with customers and which categories they might limit exposure to; also where the watch list sits.
A: Eli said they are adding many new and emerging brands across technology, athleisure, home, jewelry and Gen Z–focused retailers, including online and international entrants, and are also upgrading restaurants with an expected $400 million to $500 million incremental restaurant sales. He said the watch list is in good shape; Brian added the watch list is at its low point and recapture gives opportunity to bring in better merchants.
"I would say what is most exciting to me is our new and emerging brands, which are across a variety of sectors, includes technology companies, athleisure, home, jewelry, very big in the Gen Z, the teen consumer." — Eli Simon (CEO)
monetizing visitor data and media
Q (Alexander Goldfarb · Piper Sandler): He asked whether monetizing visitor counts and Simon Brand Ventures will drive material revenue in the next two years or is a longer-term initiative.
A: Eli said they will soon launch Simon Media Network to monetize first-party visit and screen data and the broader ecosystem of Simon+, ShopSimon and in-house screens. He noted they have over 4,000 screens, the business is growing in the double-digit to mid-teens percent range, and some investments show a 1- to 2-year payback.
"we have over 4,000 screens, the largest footprint of screens, I think, in the world that we continue to invest in." — Eli Simon (CEO)
lease retention approach
Q (Juan Sanabria · BMO): He asked if SPG will pull back on retention offers given strong demand and how leased-versus-occupied metrics shifted after the 1 million bankruptcy-returned space.
A: Eli said retention is decided on a space-by-space basis considering tenant relationship, replacement benefit and downtime; they are focused on minimizing downtime while balancing intermediate cash flow and long-term growth. Brian said signed-but-not-open is trending around 310 basis points and the recaptured Saks space helped backfill open leases.
"So on the retention side, it's a space-by-space decision that has so many different factors that go into it." — Eli Simon (CEO)
breadth of sales growth
Q (Floris Gerbrand Van Dijkum · Ladenburg Thalmann): He asked whether the strong sales and NOI growth are concentrated in the top 50 assets or broad across the portfolio.
A: Eli said the strength is broader than the top 50—malls, outlets and mills are all positive comping—and noted luxury and jewelry are especially strong while junior brands have had 16 straight months of positive comps. He added restaurants are a bit softer and some outlet strength is affected by international travel, but traffic is up across the portfolio.
"So it's definitely broader than the top 50, right?" — Eli Simon (CEO)
TRG performance and outlook
Q (Richard Hightower · Barclays): He asked for an update on TRG performance, margin gains, and when the comp contribution will normalize.
A: Eli said they've materially improved EBITDA margins on TRG assets they manage and expect further margin gains (he referenced about 300 basis points more). He said the 120 basis points boost from adding 12% ownership will drop out over the next 2 quarters, and the properties have long-term upside from planned renovations and tenant upgrades.
"And I would say there is probably another couple of hundred basis points -- sorry, 300 basis points." — Eli Simon (CEO)
upcoming debt maturities and liquidity
Q (Michael Mueller · JPMorgan): He asked how SPG plans to handle about $4.5 billion of unsecured debt due in 2H 2027 and the current cash on hand.
A: Brian said they are focused on preserving liquidity and actively accessing global capital markets, including deals in Europe and considering yen funding. He said there is plenty of capital to refinance their debt, but they expect higher interest expense and noted the guidance for the year assumed $0.25 to $0.30 of interest negativity, they are about $0.10 into it, leaving about $0.20 to go for the year.
"Ultimately, there is plenty of capital in the world today to refinance our debt." — Brian McDade (CFO)
step-up earnings opportunities
Q (Craig Mailman · Citi): He asked whether SPG can create a step function in earnings growth beyond ongoing portfolio improvements and how they might deploy capital to do so.
A: Eli said they will pursue development, reinvestment, disciplined buybacks and accretive acquisitions but will not chase scale at the wrong price. He noted they have $9.3 billion of liquidity and will act where they can add value, citing Brickell as an example of execution and accretive return.
"But the reality is we have $9.3 billion of liquidity." — Eli Simon (CEO)
sales-based rent upside and guidance
Q (Vince Tibone · Green Street): He asked how continued strong comparable sales could add upside to 2026 NOI and FFO from overage rents and what sales growth is baked into guidance.
A: Eli said sales remain strong and traffic accelerated in July, but because sales are outside their control the guidance prudently assumes some moderation. He said if current sales trends continue they would expect to be above their guidance range, but they did not want to assume no slowdown given tougher comps in the back half.
"And so the guidance effectively assumes a slowdown." — Eli Simon (CEO)
why jewelry is doing well
Q (Omotayo Okusanya · Deutsche Bank): He asked why jewelry and watches are strong despite reports of falling diamond prices and younger buyers being less interested, and whether any categories worry them for saturation.
A: Eli said jewelry and watches are selling across a range of price points: high-end luxury with demand exceeding supply and many new affordable entrants attracting younger, Instagrammable shoppers. He said SPG is expanding both established luxury relationships and new entrants, following where the customer goes.
"I would say that the jewelry space, frankly, for jewelry and watches, it's coming from a variety of price points." — Eli Simon (CEO)
AI adoption and early benefits
Q (Ronald Kamdem · Morgan Stanley): He asked how far along SPG and its retailers are in AI adoption, and whether tangible benefits are already visible.
A: Eli said it's early days but SPG has made meaningful strides recently using AI to process leases and documents faster, improve marketing imagery, and gain operational efficiency. He added retailers are starting the journey too and AI will be a major part of Simon Media Network to analyze their large visit and sales dataset.
"I would say from the SPG perspective, I think where we've made leaps and bounds strides over the past several months, and there's so much more we can do, so much more we can do with our data." — Eli Simon (CEO)