Simon Property Group Inc (SPG) Q4 2025 Earnings Call Transcript

Simon Property Group Inc (NYSE: SPG) Q4 2025 Earnings Call dated Feb. 02, 2026

Corporate Participants:

Thomas Ward — Senior Vice President – Investor Relations

David Simon — Chairman of the Board, Chief Executive Officer and President

Eli Simon — Director, Executive Vice President and Chief Operating Officer

Brian J. McDade — Executive Vice President and Chief Financial Officer

Analysts:

Caitlin Burrows — Analyst

Samir Khanal — Analyst

Michael Griffin — Analyst

Michael Goldsmith — Analyst

Alexander Goldfarb — Analyst

Craig Mailman — Analyst

Greg McGinniss — Analyst

Vince Tibone — Analyst

Floris van Dijkum — Analyst

Omotayo Okusanya — Analyst

Linda Tsai — Analyst

Michael Mueller — Analyst

Haendel St. Juste — Analyst

Juan Sanabria — Analyst

Rich Hightower — Analyst

Ronald Kamdem — Analyst

Presentation:

operator

Greetings. Welcome to Simon Property Group’s fourth quarter 2025 earnings conference call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star and the number zero on your telephone keypad. Please note this conference is being recorded.

I will now turn the conference over to Tom Ward, Senior Vice President of Investor Relations. Thank you. You may begin.

Thomas Ward — Senior Vice President – Investor Relations

Thank you, Vaughn. And thank you all for joining us this evening. Presenting on today’s call are David Simon, Chairman, Chief Executive Officer and President, Eli Simon, Chief Operating officer and Brian McDade, chief financial officer. A quick reminder that statements made during this call may be deemed forward looking statements within the meaning of the safe. Harbor of the Private Securities Litigation Reform. Act of 1995 and actual results may differ materially due to a variety of risks, uncertainties and other factors. We refer you to today’s press release and our SEC filings for a detailed discussion of the risk factors relating to those forward looking statements.

Please note that this call includes information that may be accurate only as of today’s date. Reconciliations of non GAAP financial measures to the most directly comparable GAAP measures are included within the press release and the supplemental information in today’s Form 8K filing. Both the press release and the supplemental information are available on our IR website@investors.Simon.com Our conference call this evening will be limited to one hour.

For those who would like to participate in the question and answer session, we ask that you please respect our request to limit yourself to one question and please introduce David Simon.

David Simon — Chairman of the Board, Chief Executive Officer and President

Good evening. We delivered strong financial and operational results in the fourth quarter, capping another impressive year for our company. We achieved excellent leasing performance, acquired $2 billion high quality retail properties, completed more than 20 major redevelopment projects and opened a new premium outlet in Indonesia. We reported record real estate funds from operation of $4.8 billion or $12.73 $0.03 per share.

Our results reflect solid fundamentals. Strong occupancy, accelerating shopper traffic growth, healthy and growing retail sales, positive supply and demand dynamics, all driving improvement in our cash flow. We return approximately $3.5 billion in cash to our shareholders through common stock repurchases and record cash dividends in our yearly tally. We have now paid approximately $48 billion in cash to shareholders in dividends over our history as a public company.

With that, I’m now going to turn it over to Eli. We’ll discuss our leasing and investment activities and then Brian will cover our fourth quarter results and our outlook for next year in more detail.

Eli Simon — Director, Executive Vice President and Chief Operating Officer

Thank you. During 2025 we acquired the mall, two well known luxury outlet centers in Italy. Our partner’s interest in Brickell City Center, a premier mixed use property in Miami’s rapidly growing Central Business district. The remaining 12% interest in Talbot Realty Group we did not previously own in Phillips Place, a high productivity open air retail center in Charlotte, a market we know well with significant upside from RE merchandising and densification. These deals enhance the quality of our portfolio and we look forward to deploying our leasing and property management expertise along with our strong balance sheet to pursue new growth and value creation opportunities across these properties.

Retailer demand remains strong across our portfolio. We signed more than 1,300 leases totaling over 4.4 million square feet during the quarter and over 4,600 leases for more than 17 million square feet for the year. Approximately 30% of our annual volume was new deals reflecting continued strong demand across our portfolio. Now turning to development, we completed more than 20 significant redevelopment projects in 2025 including retail and experiential additions at Southdale Center, Stanford Shopping Center, King of Prussia and the Forum Shops at Caesars and mixed use additions including hotel and residential at Northgate Station and Lakeland mall respectively.

In 2026, notable retail and mixed use projects scheduled to come online include Brea Mall, Northgate Station, first phase of residential, an open air expansion with restaurants and retail at the shops in Mission Viejo, Briarwood Mall with the new Harvest Market, Dick’s Sporting Good and residential and at Tacoma Mall, New Village shops and restaurants. We also expect to begin construction on exciting new projects including G anchor redevelopments at Fashion Mall at Keystone and Town center at Boca Raton. Expansions at Toronto, Desert Hills and Woodbury Common, Premium Allen are progressing and Sagefield, our new open air retail and mixed use development in Nashville.

We also plan to enhance the merchandise mix and invest in meaningful capital upgrades at former TRG assets including the Mall at Green Hills International Plaza and Cherry Creek Shopping Center. At year end, our share of the net cost of developments across all platforms totaled approximately $1.5 billion with a blended yield of 9%. Approximately 45% of net costs are for mixed use projects. Our pipeline of new development and redevelopment opportunities continues to grow and now exceeds $4 billion.

I will now turn it over to Brian who will walk through our fourth quarter results.

Brian J. McDade — Executive Vice President and Chief Financial Officer

Thank you Eli Real Estate FFO was $3.49 per share in the fourth quarter compared to $3.35 in the prior year. 4.2% growth. Domestic and international operations both performed well, contributing 26 cents of growth driven by a higher lease income across the business. As anticipated, lower interest income and higher interest expense combined were a 7 cent dragon horse. Domestic property NOI growth was Strong and increased 4.8% year over year for the quarter and 4.4% for the year. Portfolio NOI, which includes our international properties at constant currency, grew 5.1% for the quarter and 4.7% for the year.

Malls and premium outlets ended the year as 96.4% occupancy and the mills ended at 99.2%. The addition of the TRG assets reduced occupancy by 20 basis points for malls and premium outlets and 30 basis points for the mills. We expect to drive higher occupancy at these assets as we execute on our leasing strategy. Average base minimum rents increased 4.7% year over year for the malls and the premium outlets. The TRG properties contributed approximately 250 basis points to this growth retailer. Sales per square foot for the malls and the premium outlets were $799 per square foot per year.

The SPG only portfolio was up 2% year over year. Importantly, total sales volumes grew approximately 4% in the important fourth quarter and 3% for the full year. Occupancy cost at the end of the year was 12.7%. Turning to the balance sheet, during 2025 we completed approximately $9 billion in financing activities, including a dual tranche US senior notes offering that totaled $1.5 billion at a combined average term of 7.8 years and a weighted average coupon rate of 1.77%. It completed also completed 7 billion of secured loan refinancing and extensions in the year subsequent to year end we $800 million offering of five year notice at a spread of 65 basis points per five year.

Treasury we used the proceeds to repay 800 million of notes that matured on January 15, 2026. Our A rated balance sheet provides a distinct advantage with more than 9 billion of liquidity at year end and a net debt to ebitda measure of 5.0 times. During 2025 we paid more than $3.2 billion in common stock dividends and repurchased over 1.2 million shares for approximately $227 million. Subsequent to year end we repurchased an additional 273,000 shares for $50 million and today we announced our dividend of $2.20 per share for the first quarter a year over year increase of $0.10 or 4.8%.

The dividend is payable on March 31st. Turning to our 26 guidance, we expect real estate FFO of $13.00 to $13.25 per share with a midpoint of $13.13. The guidance range assumes domestic property NOI growth of at least 3% and higher net interest expense of 25 to $0.30 per share versus 2025 reflecting current market interest rate conditions.

Thank you. We will now open it up for questions.

Questions and Answers:

operator

Thank you. We will now be conducting a question and answer session. As a reminder, we ask that you please limit yourselves to one question. If you would like to ask a question, please press Star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press Star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

Our first question comes from Caitlin Burrows with Goldman Sachs. You may proceed with your question.

Caitlin Burrows

Hi everyone. Good evening. Maybe on the leasing side, you mentioned that 30% of lease signings last year were on new leases. So could you give some detail on what rents you’re getting on new leases and renewal leases and how your pipeline today and depth of demand compares to a year ago? I guess while keeping in mind the TRG deal and now the portfolio is larger.

Brian J. McDade

Thanks, Caitlin. It’s Brian. Look, I think what we would say that is certainly 30% is a good run rate for new leasing. We disclose the new rents on our leases, which are approximately $55 per square foot. We would expect that to continue into 2026

Eli Simon

and then just from the pipeline. Perspective, year to date, our pipeline is up about 15% over last year and that’s really broad based across all categories. So no change in tenant demand. If anything, it’s increasing.

Caitlin Burrows

Thanks.

operator

Our next question comes from Samir Kunal with Bank of America. You may proceed with your question.

Samir Khanal

Good evening everybody. I guess David or Eli, you know. Going back to November, you launched the. Simon plus Loyalty program. Is there any early observations you can. Share about the program? I mean, as it relates to maybe the impact on traffic or retailer sales, maybe? Eli, anything would be helpful from that end. Thanks.

Eli Simon

Yeah, sure. So it’s obviously early days, but we’ve. Been very pleased with the adoption from. Both a customer perspective but also getting brand excited about it. And so we’re still in the membership acquisition phase, increasing engagement. We had a great holiday activation. They got a lot of organic buzz, which was exciting and I Think helped increase traffic a bit. And so as we go into 26. It’S more of the same. Continue to focus on getting new rewards, new retailers and then also partnering with. Other loyalty programs that are outside of our space as well, working on launching that in the beginning part of this year. So we’re again early days, but we. Are very pleased with where we are so far.

operator

The next question comes from the line of Michael Griffin with Evercore isi. Please proceed with your question.

Michael Griffin

Great, thanks. Appreciate all the color so far. Just wondering if you can give some insights maybe into your thoughts around tenant credit or bad debt as it looks at the year ahead. Been some news recently around retailer bankruptcies, but just maybe give us a sense where your head is at from expectations from a tenant credit perspective, is it better, worse, the same than last year? Anything about that would be helpful. Thank you.

David Simon

Sure. Yeah, look, I think the tariffs are clearly having an effect on retailers. So it is definitely putting more pressure on them and it’s not the big guys. I think I mentioned to you this on our last call. I mean it’s really, it’s really you put Costco and Walmart and of course Amazon aside and then you have the rest of us, okay. And the rest of us are feeling the tench. And so it’s something that when we had our call last year, obviously we weren’t dealing with retailers dealt with it successfully this year but it kind of, you know, the full impact will really be 26 because it was implemented, you know, who knows, in April, I guess we’re still waiting for the Supreme Court to rule which could be a, you know, a small victory for, you know, our clients.

But, but no one really, really knows. I don’t know what Polymarket where the odds are actually. That’d be an interesting. Tom, while we’re warbling here, you can find out what Polymarket says about the Supreme Court. So you know, they have to deal with it and it’s, you know, we see it from Catalyst point of view and I mean it’s going to take a couple hundred million dollars of EBITDA away from Catalyst to pay the government. I mean if you cut through it all because I think Catalyst, rightfully so, is very focused on doing the best they can not to pass it on the consumer.

So it is a real issue and the retailers that we speak to are managing it the best they can. But it is a headwind and long story short, it’s probably put more pressure on retailers than should be and it’s going to end up hurting the small guys. So we’re a little more cautious. You know, we gave you our range that was, you know, frankly, you know, we didn’t, we didn’t have some bankruptcies in there that surfaced at the beginning of 26 that we felt comfortable enough to keep the range. You know, we do our budgets.

We finish basically at, you know, mid December. So that budget was essentially fixed. We didn’t back off it because what Eli mentioned to you, all the retail demand, but they’ll probably be a little bit more, and I would say most of it, you know, if I had to cut to the chase, is tariff pressure, which is unfortunate. I hope that answers your question.

Michael Griffin

Yep. Appreciate it.

David Simon

Thank you.

operator

The next question comes from the line of Michael Goldsmith with ubs. You may proceed with your question.

Michael Goldsmith

Good afternoon. Thanks a lot for taking my question. We heard a lot about investment and. Redevelopment from Eli, so maybe we can. You frame how much incremental NOI or. FFO we should expect this year from. Projects stabilizing either late in 2025 or in 2026. Thanks.

Brian J. McDade

Hi, Michael, it’s Brian. I think you should expect about a $30 million contribution in 26 from projects that are going to be complete.

Michael Goldsmith

Great. Thank you very much.

operator

The next question comes from the line of Alexander Goldfarb with Piper Sandler. You may proceed with your question.

Alexander Goldfarb

Hey, good evening. Good evening out there. David.

Brian J. McDade

Polybar. Hold on. 25 to 32% in favor of Policy survivors. Okay.

Alexander Goldfarb

If it does, it’s going to be an interesting opinion. David, just going to your point on the question on the guidance set in December, even though that was ahead of Saks and Eddie Bauer, but you still feel pretty good as you look at the business you guys have? There’s Simon Brand Ventures, there’s parking revenue, there’s all these other ancillary revenue sources.

Is your view that as presumably the economy grows, all these other revenue levers that you guys have will kick in and be more than sufficient to offset whatever potential tariff disruption that you outlined? Or just how are you thinking about that? Because on one hand, the tariff thing sounds like there’s going to be more ripple effects this year as the full year is felt. But at the same token, if presumably the economy accelerates, you guys have more revenue levers that should come into play and help drive earnings up.

David Simon

Yeah, Listen, I agree 1000% of your thesis. We are seeing the most important thing is traffic’s up, sales are up. The retailers that don’t make it, even though I could sit here and blame tariffs, they’re not highly productive retailers. And given that, you know, it’s our view that we can replace it with more productive retailers at higher rents. And, you know, take, you know, what’s going on at Saks as a simple example. We have, you know, a number of fifth stores and it’ll be like the Forever 21. Even though we don’t have all of Forever 21 leased, we are already way ahead of the income for that.

And we have upside of, you know, another 20, 30 boxes to lease. So sacs off fifth, you know, total was paying us around 18 million. You know, we think half the portfolio will pay us 30. And Eli shaken said that I remember the numbers right, so and then we’ll. And those are deals that we feel highly confident on. And then we have the other boxes that will generate. So, you know, we’re not, you know, we’re not replacing, you know, we’re replacing the, you know, off fifth in the sense the productivity and the rents are just so cheap that, you know, there’s a tremendous amount of upside and, you know, it takes time.

Right. But. And most of that will all be back end weighted because your GOB sales and I will be done, who knows, in the spring sometime. You know, we get the space back. You know, maybe there’s a few that we can get in the fourth quarter, but most of it will show up in 27. So the media sales, Texas demand, traffic is all moving in the right direction. And I like you, I mean, we’re bullish on the economy. It’s just, you know, that the tariffs are, you know, it’s never going to be all systems go.

We still see it a little bit on the sales. We had a good bounce back on the border. The north border. Canadians are really pissed off, so they’re not going anywhere in the US So we’re seeing kind of the north border a little weaker than the south border. We also, interestingly enough, saw a little bit of sales disruption in certain markets where there’s activity, which was interesting. But again, tariffs are, you know, a headwind. But there’s a lot of positive aspects of what’s going on. And most importantly, we’re making the properties better. You know, the Simon plus, you know, will see some benefits, you know, in 26.

And you know, as an example, Alex, we just opened Chanel in Bowler Town center off to a really good start. And you know, that’s, you know, to make that kind of, you know, with that kind of retailer who’s the best of the very best, you know, is just create so much Momentum elsewhere. So in that sense, you know, we’re very bullish.

Alexander Goldfarb

Thank you.

David Simon

Sure.

operator

The next question comes from the line of Craig Mailman City. You may proceed with your question.

Craig Mailman

Hey, everyone, just to follow up on the leasing. You know, the pace of leasing has been pretty consistent here and strong. I’m just kind of curious the tenor of the conversations. Maybe as you’re talking to retailers and, you know, their demand and appetite to go into class A and what they’re willing to pay for that versus maybe what a same tenant or, you know, vertical would be willing to pay for a space in class B. Just kind of curious what the appetite looks like there and the pricing for that.

David Simon

Yeah, well, we don’t. I mean, pricing is. It’s just so space market asset driven. There’s, you know, hopefully AI will, will solve it for us so we don’t have to, you know, negotiate. It’ll just say, here is the rent that the tenant and the landlord should agree on. And then we can, you know, I don’t know what we do, but, you know, we can, we can use that. So I can’t really. I mean, obviously A, assets have higher demand, but we’re making a lot of progress in the B’s. And we don’t really talk about pricing power.

We really talk about, you know, you can’t force a deal. So it’s, you know, the tenant has to agree, we have to agree, and, you know, it’s a negotiation. And I would say. How many leases did we do last year, guys?

Brian J. McDade

4,600.

David Simon

No, no, no. Square feet.

Brian J. McDade

17 million.

David Simon

17 million. So, strangely enough, we figured out how to make deals on 17 million square feet. Okay. So it’s more of an art than a science. Maybe AI can make it more of a science, but, you know, and again, it’s not pricing power. It’s just, you know, what’s the right deal for both of us?

Craig Mailman

I mean, I guess, is it getting easier to lease class B versus maybe 12 months ago? Any trends?

David Simon

Yeah, I think that’s. I think that’s a safe statement. And again, you know, a class. If you looked at, you know, if you looked at Southdale Mall a year or two years ago, you would say this was a C ad. Okay. And now we’ve made it an A. So, you know, part of our job is to enhance the quality, and we’re. We don’t discriminate on what we’re trying to achieve. What we’re trying to achieve is if it’s in Midland, Texas. By the way, I hope you watch Landman. Because that’s in for those who’ve been to Odessa and Midland, which, of course, I have been a few times.

You know, you really, it’s really, you know, you really get the feel for it. But our job is to make Midland, Texas, which used to have a lot of volatility in the oil price, less so today, but to make that the best it can be, at the same time trying to make Short Hills the best it can be. And that’s one of the hallmarks of our company in that we can do that. And it just takes a lot of focus, a lot of energy to do that. But at the same time, we can build an outlet like we did in. Indonesia. Right. Very few companies can build in Indonesia and then build a new outlet in Oklahoma. Okay. So, you know, that’s just what we’re about.

Craig Mailman

Great. Thank you.

operator

The next question comes from the line of Greg McGinnis with Scotiabank. Please proceed with your question.

Greg McGinniss

Hey, everyone. So normally this question doesn’t fall so deep into the question queue, but I think someone needs to ask. So, Brian, how should we think about the factors that could drive Simon to the higher or lower end of the FFO per share guidance range? Especially considering that you’re already absorbing some additional unexpected bankruptcies versus the December budgeting process?

Brian J. McDade

Greg, I think the way to think about it is very similar to how we run our business. We start in the year very conservatively and build throughout the year. I think we touched upon a variety of potential that would drive the outperformance. Certainly our insulin businesses, our leasing business, sales, certainly we’ve done.

David Simon

I would just. Sales, to me, could be significant upside. As you probably know, we budget ourselves flat. Ish. And so if we get 3% growth, you know, I would hope to beat our estimates. And to me, yeah, we’ll have bankruptcies, you know, we’ll have, you know, tenants will be delayed, that kind of stuff. But, you know, if we get the tenant sales growth that we hope to get, you know, then we’ll. We’ll do better. And I would, I don’t, you know, anticipate doing worse than our range.

Greg McGinniss

Okay, thank you.

David Simon

Thanks, sir.

operator

The next question comes from the line of Vince Thabone with Green Street. You may proceed with your question.

Vince Tibone

Hi, good evening. I got one more on guidance. Can you just discuss the level of Domestic Property NOI guidance included in 26 FFO? And then also if you could just help quantify. 25 was a bigger acquisition year than the recent past. How much did 25 completed acquisitions benefit or contribute to domestic property NOI in 26.

David Simon

We’Re projecting 3% comp NOI growth. The deals, you know, Talbot really is a 27 story because of, you know, you’ll see an announcement from us tomorrow or the next day on some transformations of three properties that now that we’ve, you know, got our hands on. We also have the integration which is a 26 story. So it’s, you know, we obviously issued the units as well and we haven’t cauterized that which is our intent. People made fun of that name, but that’s a legit use of the war. So. We really haven’t done much of that yet and we’ll be prudent about that.

That’s not really in the guidance. So. And the other deals that I’ll helped a few sets, but they’re all early days. No, that’s really helpful Car a couple were pretty small but you know, all over time will contribute to our growth.

Vince Tibone

That makes sense and it’s really helpful if I can maybe squeeze in a quick follow up. I think Brian, you mentioned earlier, I think 30 million of NOI coming online from redevelopment this year. Is that a net figure like adjusting for any NOI that’s going to be taken offline for like some of the Toddman projects you just discussed or should we model more NOI coming offline than a 30, if you follow me.

Brian J. McDade

It wasn’t a net number. No, it was basically our deliveries at the expected yields. There’s some timing elements to it as well.

David Simon

Most of what we’re doing, you know, again is back end weighted. So that’s just a, that’s just a, you know, let’s verify that number. But that’s just a more back end weighted and not the full, you know, nil niy net initial yield to those properties, those redevelopments, again, you know, give you examples. Ann Arbor Opening Best case fourth quarter. Brea Best case, fourth quarter. Mission Best case fourth quarter. And I can go down the line. But most of all that is very, very limited back end weighted Q4 openings.

Vince Tibone

Thank you.

David Simon

Okay, thank you.

operator

The next question comes from the line of Floris Van Dykem with Ladenburg. You may proceed with your question.

Floris van Dijkum

Hey, thanks guys. So quarter rise, I guess is an appropriate term. So I guess that’s another 3 million of shares that you could be buying back, it sounds like, which obviously would be accretive. My question is more on your. As I usually ask about your S and O pipeline and how that is progressing and how do you see that trending throughout 26 and into, you know, as you sign your 17 million of leases, if you can maybe Brian, if you can give a little commentary around that. What percentage of that S and O pipeline is luxury versus your traditional retailers.

Brian J. McDade

As far as Brian? So at year end, we were about 2.1% of SNO, which is consistent with the prior several years. In 1231, as you know, we opened in the fourth quarter to the vast majority of retailers and then the momentum builds throughout the balance of the year. So you would expect that number to go up second, third and fourth quarter.

David Simon

Yeah, I think it’s good that that number, you know, the way I would look at it is it’s good that that number’s staying almost stable because that means we’re replacing tenants or filling vacant space and it’s not going down. So, you know, there’s positive churn in that, which, you know, which is good.

Floris van Dijkum

So let me just make sure I understand. So 210 basis points of S and O is what it was at year end. What percentage of that is luxury tenants? If you can give a little bit more color on that.

David Simon

Yeah, we, we don’t get into that. But you know, you know, it’s not, it’s not happening. Right. You know, they’re very selective, they’re very focused. But you know, we were, we don’t really, you know, it’s not anywhere near the majority. It’s well less than half. But it’s not the size, it’s the quality. So that’s how you have to look, you know, at, you could add, you know, Southdale is a great example. Southdale set again is probably a million four square feet, million three, huge number. It’s got all sorts of funky basement third level space. Put all that aside.

What transformed south hill was essentially 70,000 square feet of high end leasing. So it’s the, it’s the quality, not the quantity. So that’s what you should focus on. It’s not, you know, oh, they’re going to do 500,000 square feet of luxury. It’s, you know, if you can add 20, 30, 40,000 in the right markets, it makes a real difference. And that’s what you should look out for. Not the actual amount of the, of the, of the.

Floris van Dijkum

And David, that’s very helpful by the way. Thank you. But is it, are there any more Southdales expected in the pipeline?

David Simon

Oh, yeah. Oh yeah. Eli’s going to announce something tomorrow or the next. Tomorrow maybe. Sorry, I haven’t proved it yet. Yeah, we definitely think there’s more to do.

Floris van Dijkum

Thanks.

David Simon

Thank you.

operator

The next question comes from the line of Omatayo Okusanya with Deutsche Bank. You may proceed with your question.

Omotayo Okusanya

Yes. Good evening, everyone. Just curious about deal flow. $2 billion of activity in 2025 was pretty good. Just curious as you’re looking globally, what. You’Re seeing out there and how we should kind of be thinking about that in 2016.

Brian J. McDade

Yeah, I mean, listen, we always. Look, but we have a very high bar. Right. The best way to think about it is it has to be something that is brand accretive to our portfolio. It’s something that we can add our expertise, whether it’s leasing, intensification, property management. Just running it better. It has to be at the right price. And so last year we were able to find a few of those transactions that we’re very excited about and are off to a good start. And if there are more of those, great. And if not, we’ll continue to reinvest into our existing portfolio, which we’re earning great yields and obviously had a big and growing shadow pipeline behind that.

David Simon

Yeah, I think, you know, with our new development in South Nashville and all the redevelopment, mixed use pipeline, the bar to buy something for us is, is, You know, you don’t have to be an Olympic high jumper, but you got it. You got to have more hops than Ward. Okay. So, you know, and, and, and why I’m saying this is because we are really excited about our redevelopment pipeline. And it’s not a capital question. It’s just, you know, it’s a, you know, we’re balling going. Take, you know, take, you know, just pops into my head.

But take Boca. Take as an example. You know, we finally, you know, we won the litigation, we were able to buy the building from Sarah Taj. And that development in itself could be $500 million. And you know, that just one example that pops in my head about, you know, we have the same thing in Fashion Valley in San Diego. Digging the penny building and creating mixed use and more retail space. So, you know, that. And then we’ve got the new development in Nashville, which could be $500 million. So Woodbury Extension of. Woodbury extension of Toronto,

Brian J. McDade

Desert Hills.

David Simon

Desert Hill. So, you know, these things, you know, are very exciting to us. And so, you know, we gotta, we gotta be, we have to have similar excitement if we buy something. And that similar excitement has to then be grounded by what Eli said, which is, you know, does it fit with our portfolio? Can we add value? You know, what’s, you know, what’s the game plan? And I’ll take the one that we bought in Brickell. You know, now that we’ve taken over leasing, we got a lot of great stuff in the works there. In an asset that, you know, ten years from now will be worth three to four billion dollars.

Omotayo Okusanya

Gotcha. Thank you.

David Simon

Thank you.

operator

The next question comes from the line of Linda Tsai with Jeffries. Please proceed with your question.

Linda Tsai

Thanks for taking my question. Just to follow up on the redevelopments, when you engage in them, are you relocating retailers within your existing property or drawing new retailers into the market or taking share from other assets in the area?

David Simon

We are bringing. Most of the time you always relocate some existing retailers, you know, in the existing building. But most of the time we’re bringing new entrants into the market.

Linda Tsai

Thank you. And then just on occupancy for 26 versus 25. How are you thinking about that? And does it vary at all across different formats, premium outlets, malls, mills?

David Simon

Linda, we do expect that there is some upward opportunity in our occupancy for the year across the platforms.

Linda Tsai

Thank you.

operator

The next question comes from the line of Mike Mueller with JP Morgan. Please proceed with your question.

Michael Mueller

Yeah, hi. Can you talk a little bit about the institutional appetite for higher productivity malls? For example, are your JV partners looking to invest more with you or are we more likely to see you buy them out?

David Simon

It’s really, you know, we don’t have a lot, to be honest. So. And what I’ve noticed, it’s really partner by partner, so. And a lot of it depends on how long they’ve held the asset, what’s going on, you know, in their, you know, real estate investments, et cetera. So it’s hard for me to say it’s really one way or another, But there’s not a. There’s not a rush to get out. And I would say there’s not a rush to get in. And if I had to make it, if I had to make a simplistic statement, which I’m very confident in. Right. Because you know, Simple Simon. Right. It’s kind of more status quo.

Michael Mueller

Got it. Okay. Thank you.

David Simon

Sure. Thank you. Michael.

operator

The next question comes from the line of Handel Saint Just with Mizuho Securities. You may proceed with your question.

Haendel St. Juste

Hey, good evening. Thanks for taking my question. I wanted to ask about luxury. I was hoping you could talk a little bit more about what you’re seeing and hearing from luxury shoppers and tenants. The upper end consumer has clearly been resilient, but looks like some of the luxury brands LVMH in Particular might be signaling a bit more caution for luxury this year. Some of that obviously tied to tariffs, Chinese spending. So I guess I’m curious, what’s your view and expectation for leasing demand and sales productivity from that tenant category for this year? Thanks.

David Simon

Sure. I would say again, it’s so dependent upon the company and then within the company, the brand, there’s some that are growing, there’s some that are still making deals but a little more cautious and then there’s some that are, you know, slightly pulling back. The good news is that the, you know, what they have all discovered over the last decade or so is the US is a lot bigger market, you know, than they ever thought it could be. So in the long run, they’re all very, very much dedicated to being an important player here. Their wholesale business, you know, is.

Obviously affected by what’s going on with Sachs Global and that could inure to our benefit potentially it might not. So I think as they look at, you know, their positioning, you know, they’re certainly going to have an opinion on that. And you know, we’re, and we’re optimistic that, you know, they’ll continue to, you know, do business with SAC Semann that will reorg and live a better life with a better balance sheet. But I’d say generally it’s steady as she goes, some growing, some peeling the onion and a lot of them just stable. And now the great thing about these brands is they make long term decisions.

They really invest in the brand and they really invest in the stores and they don’t. They do it over almost a little bit like us. They do it over a little bit longer horizon than quarter to quarter, year to year. And we really like being aligned with those kind of high quality retailers.

Haendel St. Juste

Thank you for the color.

David Simon

Sure.

operator

The next question comes from the line of Juan Sanabria with BMO Capital Markets. You may proceed with your question.

Juan Sanabria

Good afternoon. Just first a quick follow up. I think you mentioned that pipeline, the leasing pipeline was up 15% year over year. So just curious if that number was benefiting from, I mean if so, what the kind of apples to apples number is. But then just the broader question is just on these anchor boxes, how should we think about the potential capital investments. For. As those come back to you over time and kind of what you think the like the top five, let’s say most likely uses are for those boxes across the portfolio?

David Simon

Well, yeah, 15% is like for like essentially because remember we literally just took over Talbon Leasing two days ago. It feels like. Right. So but that’s that’s, like I mentioned earlier, the upside that we see in all fifth. So, you know, we’ll see. We’ll see a positive impact from both the tenant mix and the cash flow, you know, over time. And then the other. I don’t think we’re going to have that dramatic of an impact, but it’s early days here. And then if we get boxes back, you know, we’ll do what we’ve been doing with, you know, dealing with all the Sears vacancies, the boxes we got back from Penny when they piled.

I mean, you know, the one thing we’re very capable of is reimagining the real estate in the boxes. And at the end of the day, you know, gives us the opportunity to, you know, to redo the real estate, which is kind of what started with Sackdale. All right, how big is South Hill? 1.3. No, I only have 200. And how many properties do I have now?

Brian J. McDade

254.

David Simon

So I only have 254, but somehow I remembered Southdale. Right. Okay. So Southdale is an example. That whole redevelopment was spurred by, believe it or not, Herbert Herzberger going out of business. So. And then we got the penny box back, and that’s where we put lifetime in. So, you know, there’s lifetime deals to do, there’s House of Sports deals to do, there’s mixed use to do, there’s, you know, outdoor additions to do. So it really runs the spectrum. And, you know, and we’ll see where it goes. I mean, we don’t know yet. So it’s early days. My guess is we’ll have a better feel for it when we next pavement.

Juan Sanabria

Thank you.

David Simon

Sure.

operator

The next question comes from the line of Rich Hightower with Barclays. You may proceed with your question.

Rich Hightower

Hi. Good evening, guys. Thanks for taking the question. Just a small clarifying question on dacs, and then a separate question from that, if I may. I think it was reported that Simon’s got a $100 million investment in that entity as well. And so just help us understand what happens and how that investment might in some way control the outcome to whatever extent. And then my second question is just, you know, updated thoughts, if you have any, on the exchangeable Euro debt that comes due later this year and the potentiality of putting clepier shares to the debt holders there, what the math looks like there. Thank you.

David Simon

Sure. So let me answer the second first. We have gotten some redemption notices, and we’ve been issuing shares. Brian, what’s the total number?

Brian J. McDade

1.5 million shares.

David Simon

So we’ve issued 1.5 million shares to satisfy the bond when we get it put. So, you know, that’s what’s happened. That’s factual. Your first question is we did a transaction with Saks Global as part of their funding for buying Neiman Marcus. Now as part of that, we decided we weren’t just going to make that investment unless we got, You know, compensated for it. So in case it blew up, we would be home.

And so we got the right to terminate two leases. We got two buildings. And very importantly, and I’m sure you’re familiar with REAs, but throughout our whole entire portfolio with Sachs and Neiman and all fifth, we got the right to build what we want so we don’t have to go get their approval. In addition, we got the right to take that investment and convert it into a company that’s being run by Authentic Brands Group, that owns the ip, not E Commerce, not stores, but owns the ip Versace, Niemann, Bergdorf. So at the end of the day, you know, we felt like we made a good trade.

With that said, we’ve written off our investment at the end of the fourth quarter. So. But again, we got the right to build, which can keep you from doing what you want for years and years. We got two buildings, we got the right to terminate two leases if they were monetary default, which they are. And then the upside is we own the ip. So we’re, in my personal belief, we’re ahead of the game. But we went ahead and rolled off our investment.

Rich Hightower

Very helpful. Thank you.

David Simon

Yeah, good question. And thanks for asking.

operator

Our last question comes from Ronald Camden with Morgan Stanley. You may proceed with your question.

Ronald Kamdem

Hey, I just had a quick one putting some of the stuff that came up in the call earlier. Just going back to the domestic property NOI assumptions for this year versus last year. Just talking through sort of the occupancy, the releasing spreads, the bad debt. Just putting it all together high compared versus last year would be helpful. Thank you,

Brian J. McDade

Ron, It’s Brian. I think if you look, you know, we’ve now said at least 3% domestic NOI for about four years and it’s outperforming. Ultimately, it’s going to be all of the things that we’ve talked about on this call that will drive the performance of domestic store NOI above where we have guided to. Ultimately, it’s going to be the upside from occupancy, upside from leasing and a variety of other parts of the business that will contribute as it has this year in the past several years.

Ronald Kamdem

Great. That’s it for me. Thank you.

David Simon

Thank you. All right, thank you, everybody. Very good questions, and we will talk to you soon. And Brian and Tom always welcome your thoughts and insight. Thank you.

operator

Ladies and gentlemen. Thank you for your participation. This concludes today’s conference. You may disconnect your lines and have a wonderful day.