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Simon JV Unveils Fourth Premium Outlet Center in South Korea
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Simon Property Group, Inc. (SPG - Free Report) is enhancing its retail portfolio internationally. Most recently, the company’s joint venture with Shinsegae Group, known as Shinsegae Simon, opened Siheung Premium Outlets, marking the company’s fourth Premium Outlet Center in South Korea.
Specifically, Siheung Premium Outlets would house 220 domestic and international brands in 452,000 square feet of space. Reputed stores like Armani, Coach, Michael Kors, Hugo Boss and others would occupy the property, while well-known brands like Nike, Adidas, Under Armour, and New Balance are also slated to open their stores. In addition, this property would offer dining options. Also, per the company, there would be “Leisure and experiential components”.
However, over the past six months, shares of Simon Property underperformed the Zacks categorized REIT and Equity Trust – Retail industry. During the time frame, shares of the company lost 14.1%, whereas the industry descended 8.3%.
Notably, mall traffic has been affected for the past few years due to a rapid change in shopping patterns. In fact, online purchases have taken precedence over in-store purchase. These have made retailers reconsider their footprint and eventually opt for store closures in recent times. In addition, retailers unable to cope with competition have been filing bankruptcies.
This came as a pressing concern for retail REITs like Simon Property, GGP Inc. , Kimco Realty Corporation (KIM - Free Report) and The Macerich Company (MAC - Free Report) , as this trend has been considerably curtailing demand for the retail real estate space.
While Simon Property is striving to counter the pressure through various initiatives, implementation of such measures requires a decent upfront cost. However, the company’s expansion in the global market is a strategic fit. This is because Simon Property’s international presence fosters more sustainable long-term growth as compared with its domestically-focused peers. Furthermore, the company already has experience in the South Korean market, with Yeoju and Paju Premium Outlets near Seoul and the Busan Premium Outlets in Busan, which were opened earlier. This expertise is likely to help the company to widen its reach further in the region.
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Simon JV Unveils Fourth Premium Outlet Center in South Korea
Simon Property Group, Inc. (SPG - Free Report) is enhancing its retail portfolio internationally. Most recently, the company’s joint venture with Shinsegae Group, known as Shinsegae Simon, opened Siheung Premium Outlets, marking the company’s fourth Premium Outlet Center in South Korea.
Specifically, Siheung Premium Outlets would house 220 domestic and international brands in 452,000 square feet of space. Reputed stores like Armani, Coach, Michael Kors, Hugo Boss and others would occupy the property, while well-known brands like Nike, Adidas, Under Armour, and New Balance are also slated to open their stores. In addition, this property would offer dining options. Also, per the company, there would be “Leisure and experiential components”.
However, over the past six months, shares of Simon Property underperformed the Zacks categorized REIT and Equity Trust – Retail industry. During the time frame, shares of the company lost 14.1%, whereas the industry descended 8.3%.
Notably, mall traffic has been affected for the past few years due to a rapid change in shopping patterns. In fact, online purchases have taken precedence over in-store purchase. These have made retailers reconsider their footprint and eventually opt for store closures in recent times. In addition, retailers unable to cope with competition have been filing bankruptcies.
This came as a pressing concern for retail REITs like Simon Property, GGP Inc. , Kimco Realty Corporation (KIM - Free Report) and The Macerich Company (MAC - Free Report) , as this trend has been considerably curtailing demand for the retail real estate space.
While Simon Property is striving to counter the pressure through various initiatives, implementation of such measures requires a decent upfront cost. However, the company’s expansion in the global market is a strategic fit. This is because Simon Property’s international presence fosters more sustainable long-term growth as compared with its domestically-focused peers. Furthermore, the company already has experience in the South Korean market, with Yeoju and Paju Premium Outlets near Seoul and the Busan Premium Outlets in Busan, which were opened earlier. This expertise is likely to help the company to widen its reach further in the region.
Currently, Simon Property carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public.
Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Click here for Zacks' private trades >>