Showing resilience in the face of the economic downturn, Simon Property Group Inc. recently posted strong end-of-year and fourth quarter numbers.

Despite relatively flat tenant sales, the Indianapolis-based shopping center REIT reported that its diluted FFO for the quarter increased 9%, to $1.12 per share from $1.03 per share in 2000. Diluted FFO for the fiscal year rose 7%, to $3.51 per share from $3.28 per share in 2000.

"We were delighted with the results," says Louis Taylor of Deutsche Banc Alex. Brown. "Our fear was that they were going to be worse."

Simon also reported that occupancy for stores in its portfolio rose slightly, to 91.9% at the end of December compared to 91.8% for the same period in 2000. That's noteworty, Taylor said, given that many companies in other property sectors expected to lose between 100 and 300 basis points of occupancy.

Taylor attributed Simon's strength in the down market to a number of factors. "The properties themselves are solid, and you simply have longer-term leases in the retail segment -- specifically in the mall segment vis-a-vis the other property types," Taylor said. "Also, Simon doesn't have that much of a development pipeline, which could be a drag on earnings."

Simon, the nation's largest owner of regional malls, also reported:

Retail sales were $378 per sq. ft. at the end of December compared to $377 the previous year, while comparable store retail sales were $383 per sq. ft. compared to $384 the previous year.

Average base rents for mall and freestanding stores in Simon's portfolio were $29.28 per sq. ft. at the end of December, an increase of $0.97, or 3.4%, compared to the previous year. The average initial base rent for new mall store leases signed year-to-date was $34.88, an increase of $5.78, or 20%, over tenants who closed or whose leases expired.