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Mall REITs Maintain Positive Momentum in Q2 2011

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Mall REITs delivered mixed results in the second quarter of the year, but overall, the mood in the industry remained positive, with REIT executives reporting improving leasing environment.

In the mall sector, Simon Property Group and CBL & Associates Properties outperformed analyst estimates for FFO per share for the quarter, by $0.07 and $0.03 respectively. Pennsylvania REIT, Taubman Centers, the Macerich Company, Glimcher Realty Trust and General Growth Properties missed estimates, largely because of impairement charges and adjustments. The misses ranged from only $0.01 per share for Taubman to $0.25 per share for Macerich.

Nevertheless, occupancies and NOIs were up almost uniformly across mall portfolios. The sole exception to NOI growth was PREIT, which reported a decline of approximately 1.2 percent, blamed primarily on write-offs associated with Borders' liquidation.

According to comments made by Marshall Loeb, President and COO of Glimcher Realty Trust, during the company's earnings call with analysts on July 22:

Coming off a successful Las Vegas ReCon Conference... there was a noticeable return of optimism from the retailers, with a focus on new deals. In fact, we are engaged in serious discussions regarding new 2011 deals and more importantly, saw a nice strengthening for 2012.

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Elaine Misonzhnik

Senior associate editor Elaine Misonzhnik has been writing for National Real Estate Investor since June 2006 and has covered commercial real estate for more than 12 years. She first became...
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