Simon Property Group Reports Higher Yields in Q3 Results

Simon Property Group continues to grow and report higher earnings despite concerns earlier in the year about the impact of tariffs on the retail market.

During its earnings call Monday, the Indianapolis-based mall and retail center real estate investment trust (REIT) reported real estate funds from operations amounting to $1.21 billion in the third quarter of 2025, compared to the $1.15 billion announced in the previous quarter.

Simon signed 1,000 leases in the third quarter totaling about 4 million square feet. Occupancy in its portfolio was up to 96.4 percent, another increase from the previous quarter in which the company said occupancy was at 96 percent, This represents an improvement from the 96.2 percent occupancy seen at the end of Sept. 30, 2024, according to the REIT.

“The team is feeling good [that the momentum will continue through 2026],” CEO David Simon said during the call. “We’re not going to give you a number, but we feel really good about `26 in terms of our ability to produce.”

Three quarters after expressing concerns over tariffs, Simon said he is still in a wait-and-see position. 

Negotiations between the Trump administration and China are providing some optimism for the company, but the pressure that tariffs have placed on smaller retailers has led to additional costs.

“We’re still in the middle of the game. It ain’t over,” Simon said. 

Simon will also be expanding its portfolio with the acquisition of the remaining 12 percent of Taubman Realty Group, for which it bartered 5.06 million limited partnership units in exchange for part ownership.

While Simon already owned a percentage of Taubman, this acquisition is expected to generate a “big, non-cash gain” sometime in the fourth quarter, Eli Simon, chief operating officer of Simon, said during the call.

When asked what the benefits of the Taubman acquisition will be, Simon said that Taubman’s occupancy was higher than Simon’s own portfolio, and an investment in any other asset class would be beyond the scope of its specialty. 

“Data centers are trading at a four-and-a-half cap rate and we don’t know — nobody knows — what they’re going to look like in five years,” Simon said in a statement. “What we do know is that good malls have been around for 70 years — not seven years, not 17 years.”

Base minimum rent for Simon’s assets rose to $59.14 per square foot, compared to the $58.70 per square foot reported in the second quarter of 2025.

Mark Hallum can be reached at mhallum@commercialobserver.com.