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TABLE OF CONTENTS

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TABLE OF CONTENTS

EARNINGS RELEASE AND SUPPLEMENTAL INFORMATION
FOR THE QUARTER ENDED MARCH 31, 2020


 
PAGE  

 

       

Earnings Release(1)

    2-12  

Overview

       

The Company

    13  

Stock Information, Credit Ratings and Senior Unsecured Debt Covenants

    14  

Financial Data

       

Selected Financial and Equity Information

    15  

Net Operating Income (NOI) Composition

    16  

Net Operating Income Overview

    17  

Reconciliations of Non-GAAP Financial Measures

    18  

Consolidated Net Income to NOI

    18  

FFO of the Operating Partnership to Funds Available for Distribution (Our Share)

    19  

Other Income, Other Expense and Capitalized Interest

    20  

Operational Data

       

U.S. Malls and Premium Outlets Operating Information

    21  

The Mills and International Operating Information

    22  

U.S. Malls and Premium Outlets Lease Expirations

    23  

U.S. Malls and Premium Outlets Top Tenants

    24  

Development Activity

       

Capital Expenditures

    25  

Development Activity Summary

    26  

Balance Sheet Information

       

Common and Preferred Stock Information

    27  

Changes in Common Share and Limited Partnership Unit Ownership

    27  

Preferred Stock/Units Outstanding

    27  

Credit Profile

    28  

Summary of Indebtedness

    29  

Total Debt Amortization and Maturities by Year (Our Share)

    30  

Property and Debt Information

   
31-40
 

Other

       

Non-GAAP Pro-Rata Financial Information

    41-43  
(1)
Includes reconciliation of consolidated net income to funds from operations.
 
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LOGO

Contacts:    
Tom Ward   317-685-7330 Investors    
Ali Slocum   317-264-3079 Media    


SIMON PROPERTY GROUP REPORTS FIRST QUARTER 2020 RESULTS AND PROVIDES BUSINESS UPDATE

INDIANAPOLIS, May 11, 2020 - Simon, a real estate investment trust engaged in the ownership of premier shopping, dining, entertainment and mixed-use destinations, today reported results for the quarter ended March 31, 2020.

"Our thoughts are with everyone affected by COVID-19 and we salute all of the individuals on the front lines fighting the pandemic," said David Simon, Chairman, Chief Executive Officer and President. "The Simon team is meeting these unprecedented challenges with unwavering commitment to the safety of our employees, shoppers, retailers and the communities we serve. We have successfully navigated challenging times throughout our company's history, and we will endure and gain strength as we weather this disruption. The resilience of our people, our innovative business approach and our strong balance sheet with ample liquidity will serve us well."

"Business was off to a good start in January and February, with shopper traffic, tenant demand, reported retailer sales and other underlying portfolio fundamentals trending at or above our expectations," said Simon. "In March, we quickly pivoted to address the rapid spread of COVID-19, temporarily closing U.S. properties, reducing operating costs and increasing financial resources. We are beginning to reopen properties and are encouraged by the consumer response thus far."

Results for the Quarter

Net income attributable to common stockholders was $437.6 million, or $1.43 per diluted share, as compared to $548.5 million, or $1.78 per diluted share in 2019. Results for the first quarter of 2019 included a combined $83.6 million, or $0.24 per diluted share, of proceeds from an insurance settlement and a gain on the sale of our interest in a multi-family residential property. The current year period includes a $19.0 million, or $0.05 per diluted share, unrealized loss in fair value of equity instruments compared to a gain of $5.3 million, or $0.01 per diluted share, in the prior year period, from the Company's ownership of Washington Prime Group Inc. partnership units as part of the 2014 spin-off.

Funds From Operations ("FFO") was $980.6 million, or $2.78 per diluted share, as compared to $1.082 billion, or $3.04 per diluted share, in the prior year period. The first quarter 2019 results also included the $0.24 per diluted share noted above. The current year period reflects a negative impact of approximately $0.06 per diluted share (pre-tax) from the Company's investments in retailers primarily due to store closures as a result of COVID-19.

Comparable property Net Operating Income ("NOI") for the three months ended March 31, 2020 was flat and portfolio NOI declined 0.2%.
 
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Operating statistics for the Company's combined U.S. Malls and Premium Outlets:

o
Occupancy was 94.0% at March 31, 2020.

o
Base minimum rent per square foot was $55.76 at March 31, 2020.

o
Leasing spread per square foot for the trailing 12 months ended March 31, 2020 was $2.80, an increase of 4.6%.

o
Reported retailer sales per square foot were $673 for the trailing twelve months ended March 31, 2020. This was an increase of 2.1%; however, it was impacted by the Company's temporary closure of its U.S. retail properties effective March 18, 2020. This impact is shown by comparing the trailing 12 months ended February 29, 2020, sales per square foot of $703, an increase of 6.5%.

Business Update—COVID-19

As we developed and implemented our response to the impact of COVID-19 on our business, our primary focus has been on the health and safety of our employees, our shoppers and the communities in which we serve. We implemented a series of actions to reduce costs and increase liquidity in light of the impacts of the pandemic, including:

Significantly reduced all non-essential corporate spending

Significantly reduced property operating expenses

Implemented a temporary furlough of certain corporate and field employees due to the closure of the Company's U.S. retail properties as a result of governmental "stay-at-home" orders; reduced certain corporate and field personnel and implemented a temporary freeze on company hiring efforts

Suspended or eliminated more than $1.0 billion of redevelopment and new development projects

David Simon, the Company's Chairman, Chief Executive Officer and President elected to reduce his base salary to zero and deferred his approved 2019 bonus until the market conditions in which the Company operates have improved

Implemented a temporary decrease to the base salary of certain of its salaried employees ranging from 10% to 30%, depending on each employee's compensation level

The Company's Board of Directors agreed to temporarily suspend payment to the independent directors of their board service cash retainer fees

Drew $3.75 billion under its Revolving Credit Facilities

In addition, we launched "Simon Supports Communities" to assist charitable organizations, hospitals and local communities impacted by COVID-19. The program deploys Simon's physical, digital and social media assets to help nonprofit organizations make a difference. Initiatives underway include utilizing parking lots at Simon centers for drive-through COVID-19 testing in local communities; hosting food banks; and deploying our network of over 200 websites and social media channels to support the American Red Cross "Sleeves Up" campaign aimed at boosting depleted blood supplies.

 
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Reopening of Simon's Retail Properties

As of May 11, the Company has reopened 77 of its U.S. retail properties in markets where local and state orders have been lifted and retail restrictions have been eased. As part of the reopening process, the Company published its comprehensive "COVID-19 Exposure Control Policy", developed in conjunction with a team of leading experts in the fields of Epidemiology and Environmental Health and Safety (EHS), in order to provide a high level of safety standards at its properties.

In addition, as of May 11, twelve of Simon's Designer and international Premium Outlets properties have reopened.

Development Activity

The Company has suspended or eliminated more than $1.0 billion of capital for new and redevelopment projects. The Company will re-evaluate all suspended projects over time. Construction continues on certain redevelopment and new development projects in the U.S. and internationally that are nearing completion. Simon's share of remaining required cash funding for these projects that are currently scheduled to be completed in 2020 or 2021 is approximately $160 million.

Capital Markets and Balance Sheet Liquidity

During the quarter, the Company took certain steps to increase financial flexibility.

As previously announced in March, the Company amended and extended its $4.0 billion senior unsecured multi-currency revolving credit facility with a $6.0 billion senior unsecured credit facility comprised of a $4.0 billion multi-currency revolving credit facility and a $2.0 billion delayed draw term loan facility. Subject to additional commitments, the revolving credit facilities can be increased by $1.0 billion, for an aggregate up to $7.0 billion. The revolving facility initially matures on June 30, 2024, and the term facility initially matures on June 30, 2022.

As of March 31, 2020, Simon had approximately $8.7 billion of liquidity consisting of $4.1 billion of cash on hand, including its share of joint venture cash, and $4.6 billion of available capacity under its revolving credit facilities and term loan, net of outstanding U.S. and Euro commercial paper.

Dividends

Simon's Board of Directors will declare a common stock dividend for the second quarter before the end of June. Simon intends to maintain a common stock dividend paid in cash and expects to distribute at least 100% of its REIT taxable income.

Simon's Board of Directors declared the quarterly dividend on its 83/8% Series J Cumulative Redeemable Preferred Stock (NYSE: SPGPrJ) of $1.046875 per share, payable on June 30, 2020 to shareholders of record on June 16, 2020.

 
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Withdrawal of 2020 Financial Guidance

Given the evolving nature of COVID-19 and the global economic disruption it has caused, it is not currently possible to predict with certainty the pandemic's impact on the rest of the year's financial results. As such, the Company is withdrawing its full-year 2020 guidance for estimated net income attributable to common stockholders per diluted share, estimated FFO per diluted share and comparable property NOI growth, which were provided on February 4, 2020.

Conference Call

Simon will hold a conference call to discuss the quarterly financial results today at 5:00 p.m. Eastern Time, Monday, May 11, 2020. A live webcast of the conference call will be accessible in listen-only mode at investors.simon.com. An audio replay of the conference call will be available until May 18, 2020. To access the audio replay, dial 1-855-859-2056 (international 404-537-3406) passcode 6984058.

Supplemental Materials and Website

Supplemental information on our first quarter 2020 performance is available at investors.simon.com. This information has also been furnished to the SEC in a current report on Form 8-K.

We routinely post important information online on our investor relations website, investors.simon.com. We use this website, press releases, SEC filings, quarterly conference calls, presentations and webcasts to disclose material, non-public information in accordance with Regulation FD. We encourage members of the investment community to monitor these distribution channels for material disclosures. Any information accessed through our website is not incorporated by reference into, and is not a part of, this document.

Non-GAAP Financial Measures

This press release includes FFO, FFO per share, portfolio net operating income growth and comparable property net operating income growth, which are financial performance measures not defined by generally accepted accounting principles in the United States ("GAAP"). Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures are included in this press release and in Simon's supplemental information for the quarter. FFO and comparable property net operating income growth are financial performance measures widely used in the REIT industry. Our definitions of these non-GAAP measures may not be the same as similar measures reported by other REITs.

 
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Forward-Looking Statements

Certain statements made in this press release may be deemed "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Although the Company believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be attained, and it is possible that the Company's actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks, uncertainties and other factors. Such factors include, but are not limited to: uncertainties regarding the impact of the COVID-19 pandemic and restrictions intended to prevent its spread on our tenants' businesses, financial condition, results of operations, cash flow and liquidity and our ability to access the capital markets, satisfy our debt service obligations and make distributions to our stockholders; the inability to collect rent due to the bankruptcy or insolvency of tenants or otherwise; changes in economic and market conditions that may adversely affect the general retail environment; the intensely competitive market environment in the retail industry; changes to applicable laws or regulations or the interpretation thereof; risks associated with the acquisition, development, redevelopment, expansion, leasing and management of properties; the inability to lease newly developed properties and renew leases and relet space at existing properties on favorable terms; the potential loss of anchor stores or major tenants; decreases in market rental rates; the impact of our substantial indebtedness on our future operations; any disruption in the financial markets that may adversely affect our ability to access capital for growth and satisfy our ongoing debt service requirements; any change in our credit rating; changes in market rates of interest and foreign exchange rates for foreign currencies; general risks related to real estate investments, including the illiquidity of real estate investments; security breaches that could compromise our information technology or infrastructure; risks relating to our joint venture properties; our continued ability to maintain our status as a REIT; changes in tax laws or regulations that result in adverse tax consequences; changes in the value of our investments in foreign entities; our ability to hedge interest rate and currency risk; changes in insurance costs; the availability of comprehensive insurance coverage; risks related to international activities, including, without limitation, the impact, if any, of the United Kingdom's exit from the European Union; natural disasters; the potential for terrorist activities; environmental liabilities; the loss of key management personnel; and the transition of LIBOR to an alternative reference rate. The Company discusses these and other risks and uncertainties under the heading "Risk Factors" in its annual and quarterly periodic reports filed with the SEC. The Company may update that discussion in subsequent other periodic reports, but except as required by law, the Company undertakes no duty or obligation to update or revise these forward-looking statements, whether as a result of new information, future developments, or otherwise.

About Simon

Simon is a global leader in the ownership of premier shopping, dining, entertainment and mixed-use destinations and an S&P 100 company (Simon Property Group, NYSE:SPG). Our properties across North America, Europe and Asia provide community gathering places for millions of people every day and generate billions in annual sales. For more information, visit simon.com.

 
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Simon Property Group, Inc.
Unaudited Consolidated Statements of Operations
(Dollars in thousands, except per share amounts)

 
  FOR THE THREE MONTHS
ENDED MARCH 31,
 
 
 
2020
   
2019
 

REVENUE:

             

Lease income

  $ 1,262,232   $ 1,280,058  

Management fees and other revenues

    29,166     27,544  

Other income

    61,962     145,232  

Total revenue

    1,353,360     1,452,834  

EXPENSES:

             

Property operating

    105,624     111,549  

Depreciation and amortization

    328,262     328,643  

Real estate taxes

    117,543     115,459  

Repairs and maintenance

    24,431     27,922  

Advertising and promotion

    33,527     37,125  

Home and regional office costs

    54,370     52,560  

General and administrative

    6,894     9,136  

Other

    27,840     25,419  

Total operating expenses

    698,491     707,813  

OPERATING INCOME BEFORE OTHER ITEMS

    654,869     745,021  

Interest expense

    (187,627)     (198,733)  

Income and other tax benefit (expense)

    5,783     (10,102)  

Income from unconsolidated entities

    50,465     90,444  

Unrealized (losses) gains in fair value of equity instruments

    (19,048)     5,317  

Gain on sale or disposal of assets and interests in unconsolidated entities, net

    962      

CONSOLIDATED NET INCOME

    505,404     631,947  

Net income attributable to noncontrolling interests

    66,965     82,638  

Preferred dividends

    834     834  

NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS

  $ 437,605   $ 548,475  

BASIC AND DILUTED EARNINGS PER COMMON SHARE:

             

Net income attributable to common stockholders

  $ 1.43   $ 1.78  
 
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Simon Property Group, Inc.
Unaudited Consolidated Balance Sheets
(Dollars in thousands, except share amounts)

 
  MARCH 31,
2020
  DECEMBER 31,
2019
 

ASSETS:

             

Investment properties, at cost

  $ 37,901,273   $ 37,804,495  

Less — accumulated depreciation

    14,088,615     13,905,776  

    23,812,658     23,898,719  

Cash and cash equivalents

    3,724,853     669,373  

Tenant receivables and accrued revenue, net

    793,490     832,151  

Investment in unconsolidated entities, at equity

    2,414,642     2,371,053  

Investment in Klépierre, at equity

    1,628,343     1,731,649  

Right-of-use assets, net

    519,175     514,660  

Deferred costs and other assets

    1,227,953     1,214,025  

Total assets

  $ 34,121,114   $ 31,231,630  

LIABILITIES:

             

Mortgages and unsecured indebtedness

  $ 27,553,413   $ 24,163,230  

Accounts payable, accrued expenses, intangibles, and deferred revenues

    1,253,757     1,390,682  

Cash distributions and losses in unconsolidated entities, at equity

    1,611,795     1,566,294  

Lease liabilities

    521,378     516,809  

Other liabilities

    457,624     464,304  

Total liabilities

    31,397,967     28,101,319  

Commitments and contingencies

             

Limited partners' preferred interest in the Operating Partnership and noncontrolling redeemable interests in properties

    212,194     219,061  

EQUITY:

   
 
   
 
 

Stockholders' Equity

             

Capital stock (850,000,000 total shares authorized, $0.0001 par value, 238,000,000 shares of excess common stock, 100,000,000 authorized shares of preferred stock):

             

Series J 83/8% cumulative redeemable preferred stock, 1,000,000 shares authorized, 796,948 issued and outstanding with a liquidation value of $39,847

   
42,338
   
42,420
 

             

Common stock, $0.0001 par value, 511,990,000 shares authorized, 320,567,121 and 320,435,256 issued and outstanding, respectively

    32     32  

             

Class B common stock, $0.0001 par value, 10,000 shares authorized, 8,000 issued and outstanding

         

             

Capital in excess of par value

    9,768,175     9,756,073  

Accumulated deficit

    (5,583,485)     (5,379,952)  

Accumulated other comprehensive loss

    (119,301)     (118,604)  

Common stock held in treasury, at cost, 14,819,950 and 13,574,296 shares, respectively

    (1,926,160)     (1,773,571)  

Total stockholders' equity

    2,181,599     2,526,398  

Noncontrolling interests

    329,354     384,852  

Total equity

    2,510,953     2,911,250  

Total liabilities and equity

  $ 34,121,114   $ 31,231,630  
 
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Simon Property Group, Inc.
Unaudited Joint Venture Combined Statements of Operations
(Dollars in thousands)

 
  For the Three Months
Ended March 31,
 
 
 
2020
 
2019
 

REVENUE:

             

Lease income

  $ 743,849   $ 758,979  

Other income

    74,515     75,922  

Total revenue

    818,364     834,901  

OPERATING EXPENSES:

   
 
   
 
 

Property operating

    147,030     144,721  

Depreciation and amortization

    171,479     170,258  

Real estate taxes

    68,390     68,717  

Repairs and maintenance

    19,615     22,376  

Advertising and promotion

    22,753     24,326  

Other

    50,229     49,316  

Total operating expenses

    479,496     479,714  

OPERATING INCOME BEFORE OTHER ITEMS

   
338,868
   
355,187
 

Interest expense

    (156,640)     (156,016)  

Gain on sale or disposal of assets and interests in unconsolidated entities, net

        21,587  

NET INCOME

  $ 182,228   $ 220,758  

Third-Party Investors' Share of Net Income

  $ 92,859   $ 112,668  

Our Share of Net Income

    89,369     108,090  

Amortization of Excess Investment (A)

    (20,840)     (20,792)  

Our Share of Gain on Sale or Disposal of Assets and Interests in Other Income in the Consolidated Financial Statements

        (9,155)  

Income from Unconsolidated Entities (B)

  $ 68,529   $ 78,143  

Note:
The above financial presentation does not include any information related to our investments in Klépierre S.A. ("Klépierre") and HBS Global Properties ("HBS"). For additional information, see footnote B.
 
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Simon Property Group, Inc
Unaudited Joint Venture Combined Balance Sheets
(Dollars in thousands)

 
  March 31,
2020
  December 31,
2019
 

Assets:

             

Investment properties, at cost

  $ 19,500,080   $ 19,525,665  

Less — accumulated depreciation

    7,493,263     7,407,627  

    12,006,817     12,118,038  

Cash and cash equivalents

   
844,940
   
1,015,864
 

Tenant receivables and accrued revenue, net

    445,799     510,157  

Right-of-use assets, net

    180,638     185,302  

Deferred costs and other assets

    371,875     384,663  

Total assets

  $ 13,850,069   $ 14,214,024  

Liabilities and Partners' Deficit:

   
 
   
 
 

Mortgages

  $ 15,328,574   $ 15,391,781  

Accounts payable, accrued expenses, intangibles, and deferred revenue

    789,129     977,112  

Lease liabilities

    182,465     186,594  

Other liabilities

    362,323     338,412  

Total liabilities

    16,662,491     16,893,899  

Preferred units

   
67,450
   
67,450
 

Partners' deficit

    (2,879,872)     (2,747,325)  

Total liabilities and partners' deficit

  $ 13,850,069   $ 14,214,024  

Our Share of:

   
 
   
 
 

Partners' deficit

  $ (1,248,877)   $ (1,196,926)  

Add: Excess Investment (A)

    1,504,586     1,525,903  

Our net Investment in unconsolidated entities, at equity

  $ 255,709   $ 328,977  

Note:
The above financial presentation does not include any information related to our investments in Klépierre and HBS Global Properties. For additional information, see footnote B.
 
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Simon Property Group, Inc.
Unaudited Reconciliation of Non-GAAP Financial Measures (C)
(Amounts in thousands, except per share amounts)

 
  Reconciliation of Consolidated Net Income to FFO
   
   
   
 
   
  For the Three Months
Ended March 31,
   
 
   
   
2020
 
2019
   

 

Consolidated Net Income (D)

  $ 505,404   $ 631,947    

 

Adjustments to Arrive at FFO:

               

 

Depreciation and amortization from consolidated properties

    326,039     325,938    

 

Our share of depreciation and amortization from unconsolidated entities, including Klépierre and HBS

    136,706     134,630    

 

Gain on sale or disposal of assets and interests in unconsolidated entities, net

    (962)        

 

Unrealized losses (gains) in fair value of equity instruments

    19,048     (5,317)    

 

Net loss attributable to noncontrolling interest holders in properties

    172     917    

 

Noncontrolling interests portion of depreciation and amortization

    (4,464)     (4,882)    

 

Preferred distributions and dividends

    (1,313)     (1,313)    

 

FFO of the Operating Partnership

  $ 980,630   $ 1,081,920    

 

Diluted net income per share to diluted FFO per share reconciliation:

               

 

Diluted net income per share

  $ 1.43   $ 1.78    

 

Depreciation and amortization from consolidated properties and our share of depreciation and amortization from unconsolidated entities, including Klépierre and HBS, net of noncontrolling interests portion of depreciation and amortization

    1.31     1.27    

 

Gain on sale or disposal of assets and interests in unconsolidated entities, net

    (0.01)        

 

Unrealized losses (gains) in fair value of equity instruments

    0.05     (0.01)    

 

Diluted FFO per share

  $ 2.78   $ 3.04    

   

 

 

               

 

 

Details for per share calculations:

               

 

 

FFO of the Operating Partnership

  $ 980,630   $ 1,081,920    

 

 

Diluted FFO allocable to unitholders

    (129,628)     (142,319)    
 

 

 

Diluted FFO allocable to common stockholders

  $ 851,002   $ 939,601    
 
 
 

 

 

Basic and Diluted weighted average shares outstanding

    306,504     308,978    

 

 

Weighted average limited partnership units outstanding

    46,688     46,800    
 

 

 

Basic and Diluted weighted average shares and units outstanding

    353,192     355,778    
 
 
 

 

 

Basic and Diluted FFO per Share

  $ 2.78   $ 3.04    

 

 

Percent Change

    –8.6%          
 
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Simon Property Group, Inc.
Footnotes to Unaudited Financial Information

Notes:

(A)
Excess investment represents the unamortized difference of our investment over equity in the underlying net assets of the related partnerships and joint ventures shown therein. The Company generally amortizes excess investment over the life of the related assets.

(B)
The Unaudited Joint Venture Combined Statements of Operations do not include any operations or our share of net income or excess investment amortization related to our investments in Klépierre and HBS Global Properties. Amounts included in Footnote D below exclude our share of related activity for our investments in Klépierre and HBS Global Properties. For further information on Klépierre, reference should be made to financial information in Klépierre's public filings and additional discussion and analysis in our Form 10-K.

(C)
This report contains measures of financial or operating performance that are not specifically defined by GAAP, including FFO and FFO per share. FFO is a performance measure that is standard in the REIT business. We believe FFO provides investors with additional information concerning our operating performance and a basis to compare our performance with those of other REITs. We also use these measures internally to monitor the operating performance of our portfolio. Our computation of these non-GAAP measures may not be the same as similar measures reported by other REITs.

    We determine FFO based upon the definition set forth by the National Association of Real Estate Investment Trusts ("NAREIT") Funds From Operations White Paper — 2018 Restatement. Our main business includes acquiring, owning, operating, developing, and redeveloping real estate in conjunction with the rental of real estate. Gains and losses of assets incidental to our main business are included in FFO. We determine FFO to be our share of consolidated net income computed in accordance with GAAP, excluding real estate related depreciation and amortization, excluding gains and losses from extraordinary items, excluding gains and losses from the sale, disposal or property insurance recoveries of, or any impairment related to, depreciable retail operating properties, plus the allocable portion of FFO of unconsolidated joint ventures based upon economic ownership interest, and all determined on a consistent basis in accordance with GAAP. However, you should understand that FFO does not represent cash flow from operations as defined by GAAP, should not be considered as an alternative to net income determined in accordance with GAAP as a measure of operating performance, and is not an alternative to cash flows as a measure of liquidity.

(D)
Includes our share of:

-
Gains on land sales of $5.2 million and $4.4 million for the three months ended March 31, 2020 and 2019, respectively.

-
Straight-line adjustments increased income by $12.0 million and $16.7 million for the three months ended March 31, 2020 and 2019, respectively.

-
Amortization of fair market value of leases from acquisitions increased income by $1.3 million and $1.3 million for the three months ended March 31, 2020 and 2019.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 12

Table of Contents

OVERVIEW

THE COMPANY

Simon Property Group, Inc. (NYSE:SPG) is a self-administered and self-managed real estate investment trust ("REIT"). Simon Property Group, L.P., or the Operating Partnership, is our majority-owned partnership subsidiary that owns all of our real estate properties and other assets. In this package, the terms Simon, we, our, or the Company refer to Simon Property Group, Inc., the Operating Partnership, and its subsidiaries. We own, develop and manage premier shopping, dining, entertainment and mixed-use destinations, which consist primarily of malls, Premium Outlets®, The Mills®, and International Properties. At March 31, 2020, we owned or had an interest in 234 properties comprising 191 million square feet in North America, Asia and Europe. Additionally, at March 31, 2020, we had a 22.4% ownership interest in Klépierre, a publicly traded, Paris-based real estate company, which owns shopping centers in 15 European countries.

This package was prepared to provide operational and balance sheet information as of March 31, 2020 for the Company and the Operating Partnership.

Certain statements made in this Supplemental Package may be deemed "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance that our expectations will be attained, and it is possible that our actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks, uncertainties and other factors. Such factors include, but are not limited to: uncertainties regarding the impact of the COVID-19 pandemic and restrictions intended to prevent its spread on our tenants' businesses, financial condition, results of operations, cash flow and liquidity and our ability to access the capital markets, satisfy our debt service obligations and make distributions to our stockholders; the inability to collect rent due to the bankruptcy or insolvency of tenants or otherwise; changes in economic and market conditions that may adversely affect the general retail environment; the intensely competitive market environment in the retail industry; changes to applicable laws or regulations or the interpretation thereof; risks associated with the acquisition, development, redevelopment, expansion, leasing and management of properties; the inability to lease newly developed properties and renew leases and relet space at existing properties on favorable terms; the potential loss of anchor stores or major tenants; decreases in market rental rates; the impact of our substantial indebtedness on our future operations; any disruption in the financial markets that may adversely affect our ability to access capital for growth and satisfy our ongoing debt service requirements; any change in our credit rating; changes in market rates of interest and foreign exchange rates for foreign currencies; general risks related to real estate investments, including the illiquidity of real estate investments; security breaches that could compromise our information technology or infrastructure; risks relating to our joint venture properties; our continued ability to maintain our status as a REIT; changes in tax laws or regulations that result in adverse tax consequences; changes in the value of our investments in foreign entities; our ability to hedge interest rate and currency risk; changes in insurance costs; the availability of comprehensive insurance coverage; risks related to international activities, including, without limitation, the impact, if any, of the United Kingdom's exit from the European Union; natural disasters; the potential for terrorist activities; environmental liabilities; the loss of key management personnel; and the transition of LIBOR to an alternative reference rate. We discuss these and other risks and uncertainties under the heading "Risk Factors" in our annual and quarterly periodic reports filed with the SEC. We may update that discussion in subsequent other periodic reports, but, except as required by law, we undertake no duty or obligation to update or revise these forward-looking statements, whether as a result of new information, future developments, or otherwise.

Any questions, comments or suggestions regarding this Supplemental Information should be directed to Tom Ward, Senior Vice President of Investor Relations (tom.ward@simon.com or 317.685.7330).

 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 13

Table of Contents

OVERVIEW

STOCK INFORMATION

The Company's common stock and one series of preferred stock are traded on the New York Stock Exchange under the following symbols:

 

Common Stock

  SPG                                   

 

8.375% Series J Cumulative Redeemable Preferred

  SPGPrJ        


CREDIT RATINGS

 

Standard & Poor's

 

 

 

 

 
 

 

Corporate

  A   (Negative Outlook)    

 

Senior Unsecured

  A   (Negative Outlook)    

 

Commercial Paper

  A1   (Negative Outlook)    

 

Preferred Stock

  BBB+   (Negative Outlook)    

 

Moody's

 

 

 

 

 
 

 

Senior Unsecured

  A2   (Negative Outlook)    

 

Commercial Paper

  P1   (Negative Outlook)    

 

Preferred Stock

  A3   (Negative Outlook)    

SENIOR UNSECURED DEBT COVENANTS (1)

  Required   Actual   Compliance

Total Debt to Total Assets (1)

  £65%   42%   Yes

Total Secured Debt to Total Assets (1)

  £50%   17%   Yes

Fixed Charge Coverage Ratio

  >1.5X   5.1X   Yes

Total Unencumbered Assets to Unsecured Debt

  ³125%   243%   Yes
(1)
Covenants for indentures dated June 7, 2005 and later. Total Assets are calculated in accordance with the indenture and essentially represent net operating income (NOI) divided by a 7.0% capitalization rate plus the value of other assets at cost.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 14

Table of Contents

SELECTED FINANCIAL AND EQUITY INFORMATION
(In thousands, except as noted)

 

THREE MONTHS ENDED
MARCH 31,
 
 

 
2020
2019  

Financial Highlights

             

Total Revenue – Consolidated Properties

  $ 1,353,360   $ 1,452,834  

Consolidated Net Income

 
$

505,404
 
$

631,947
 

Net Income Attributable to Common Stockholders

  $ 437,605   $ 548,475  

Basic and Diluted Earnings per Common Share (EPS)

  $ 1.43   $ 1.78  

Funds from Operations (FFO) of the Operating Partnership

 
$

980,630
 
$

1,081,920
 

Basic and Diluted FFO per Share (FFOPS)

  $ 2.78   $ 3.04  

Dividends/Distributions per Share/Unit

 
$

2.10
 
$

2.05
 


Stockholders' Equity Information

 


AS OF
MARCH 31,
2020





AS OF
DECEMBER 31,
2019
 

Limited Partners' Units Outstanding at end of period

    46,529     46,740  

Common Shares Outstanding at end of period

    305,755     306,869  

Total Common Shares and Limited Partnership Units Outstanding at end of period

    352,284     353,609  

Weighted Average Limited Partnership Units Outstanding

    46,688     46,744  

Weighted Average Common Shares Outstanding:

             

Basic and Diluted – for purposes of EPS and FFOPS

    306,504     307,950  

 

             

Debt Information

             

Share of Consolidated Debt

  $ 27,380,744   $ 23,988,186  

Share of Joint Venture Debt

    7,178,727     7,214,181  

Share of Total Debt

  $ 34,559,471   $ 31,202,367  

Share of Cash and Cash Equivalents

    4,094,202     1,114,490  

Share of Net Debt

  $ 30,465,269   $ 30,087,877  

 

             

Market Capitalization

             

Common Stock Price at end of period

  $ 54.86   $ 148.96  

Common Equity Capitalization, including Limited Partnership Units

  $ 19,326,323   $ 52,673,608  

Preferred Equity Capitalization, including Limited Partnership Preferred Units

    70,167     83,236  

Total Equity Market Capitalization

  $ 19,396,490   $ 52,756,844  

Total Market Capitalization – Including Share of Total Debt

  $ 53,955,961   $ 83,959,211  
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 15

Table of Contents

NET OPERATING INCOME (NOI) COMPOSITION (1)
For the Three Months Ended March 31, 2020

 

GRAPHIC

(1)
Based on our share of total NOI and does not reflect any property, entity or corporate-level debt.
(2)
Includes Klépierre, international Premium Outlets, international Designer Outlets.
(3)
Includes Lifestyle Centers.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 16

Table of Contents

NET OPERATING INCOME OVERVIEW (1)
(In thousands)

 

FOR THE THREE MONTHS
ENDED MARCH 31,
 
 

 
2020
2019  

Comparable Property NOI  (2)

  $ 1,318,754   $ 1,318,136  

NOI from New Development, Redevelopment, Expansion and Acquisitions  (3)

   
37,925
   
39,761
 

International Properties  (4)

    110,464     111,604  

Portfolio NOI

  $ 1,467,143   $ 1,469,501  

Our share of NOI from Investments  (5)

   
28,619
   
53,141
 

Corporate and Other NOI Sources  (6)

    83,457     192,838  

Combined NOI

  $ 1,579,219   $ 1,715,480  

Less: Joint Venture Partners' Share of NOI

   
271,626
   
276,488
 

Our Share of Total NOI

  $ 1,307,593   $ 1,438,992  
(1)
All amounts are presented at gross values unless otherwise indicated as our share. See reconciliation on following page.

(2)
Includes Malls, Premium Outlets, The Mills and Lifestyle Centers opened and operating as comparable for the period at constant currency.

(3)
Includes total property NOI for properties undergoing redevelopment as well as incremental NOI for expansion properties not yet included in comparable properties.

(4)
Includes International Premium Outlets (except for Canadian International Premium Outlets included in Comparable NOI) and International Designer Outlets at constant currency.

(5)
Includes our share of NOI of Klépierre (at constant currency), HBS, and retailer investments. Substantially all of the NOI decline in the first three months of 2020 related to the impact of COVID-19 on our retailer investments operations from store closures ($17,362 reduction in NOI) as well as the impact on our share of NOI from our investment in Klépierre resulting from property closures.

(6)
Includes income components excluded from Portfolio NOI and Comparable Property NOI (domestic lease termination income, interest income, land sale gains, straight line lease income, above/below market lease adjustments), unrealized and realized gains/losses on non-real estate related equity instruments, Northgate, Simon management company revenues, and other assets. The three months ended March 31, 2019 includes $83,582 related to the Opry Mills settlement and a gain on the sale of Phipps residential.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 17

Table of Contents

RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
(In thousands, except as noted)

RECONCILIATION OF NET INCOME TO NOI

    

           

 
THREE MONTHS ENDED MARCH 31,
 

  2020   2019

Reconciliation of NOI of consolidated entities:

         

Consolidated Net Income

  $ 505,404   $ 631,947

Income and other tax (benefit) expense

  (5,783)     10,102

Interest expense

  187,627     198,733

Income from unconsolidated entities

  (50,465)     (90,444)

Unrealized losses (gains) in fair value of equity instruments

  19,048     (5,317)

Gain on sale or disposal of assets and interests in unconsolidated entities, net

  (962)    

Operating Income Before Other Items

  654,869     745,021

Depreciation and amortization

  328,262     328,643

Home and regional office costs

  54,370     52,560

General and administrative

  6,894     9,136

NOI of consolidated entities

  $ 1,044,395   $ 1,135,360

Reconciliation of NOI of unconsolidated entities:

         

Net Income

  $ 182,228   $ 220,758

Interest expense

  156,640     156,016

Gain on sale or disposal of assets and interests in unconsolidated entities, net

      (21,587)

Operating Income Before Other Items

  338,868     355,187

Depreciation and amortization

  171,479     170,258

NOI of unconsolidated entities

  $ 510,347   $ 525,445

Add: Our share of NOI from Klépierre, HBS and other corporate investments

  24,477     54,675

Combined NOI

  $ 1,579,219   $ 1,715,480
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 18

Table of Contents

RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
(In thousands, except as noted)

RECONCILIATION OF FFO OF THE OPERATING PARTNERSHIP TO FUNDS AVAILABLE FOR DISTRIBUTION (OUR SHARE)

    

 

THREE
MONTHS ENDED
MARCH 31, 2020

FFO of the Operating Partnership

$ 980,630

Non-cash impacts to FFO(1)

5

FFO of the Operating Partnership excluding non-cash impacts

980,635

Tenant allowances

(44,220)

Operational capital expenditures

(18,388)

Funds available for distribution

$ 918,027
(1)
Non-cash impacts to FFO of the Operating Partnership include:

    

 

THREE
MONTHS ENDED
MARCH 31, 2020

Deductions:

 

Straight-line lease income

(12,017)

Fair market value of lease amortization

(1,285)

Additions:

 

Stock based compensation expense

6,728

Fair value of debt amortization

83

Mortgage, financing fee and terminated swap amortization expense

6,496

$ 5

This report contains measures of financial or operating performance that are not specifically defined by generally accepted accounting principles (GAAP) in the United States, including FFO, FFO per share, funds available for distribution, net operating income (NOI), portfolio NOI, and comparable property NOI. FFO and NOI are performance measures that are standard in the REIT business. We believe FFO and NOI provide investors with additional information concerning our operating performance and a basis to compare our performance with the performance of other REITs. We also use these measures internally to monitor the operating performance of our portfolio. Our computation of these non-GAAP measures may not be the same as similar measures reported by other REITs.

The non-GAAP financial measures used in this report should not be considered as alternatives to net income as a measure of our operating performance or to cash flows computed in accordance with GAAP as a measure of liquidity nor are they indicative of cash flows from operating and financial activities. Reconciliations of other non-GAAP measures used in this report to the most-directly comparable GAAP measure are included in the tables on pages 17 - 19 and in the Earnings Release for the latest period.

 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 19

Table of Contents

OTHER INCOME, OTHER EXPENSE AND CAPITALIZED INTEREST
(In thousands)

 

THREE MONTHS ENDED
MARCH 31,
 

 
2020
2019

Consolidated Properties

           

Other Income

           

Interest, dividend and distribution income  (1)

  $ 4,574   $ 6,786

Lease settlement income

    2,642     2,498

Gains on land sales

    5,210     2,550

Other  (2)(3)

    49,536     133,398

Totals

  $ 61,962   $ 145,232

 

           

Other Expense

           

Ground leases

  $ 10,866   $ 10,245

Professional fees and other

    16,974     15,174

Totals

  $ 27,840   $ 25,419

    

           

 

Capitalized Interest

 

THREE MONTHS ENDED
MARCH 31,
 

 
2020
2019

Interest Capitalized during the Period:

           

Our Share of Consolidated Properties

  $ 9,515   $ 6,428

Our Share of Joint Venture Properties

  $ 351   $ 249

           

           
(1)
Includes distributions from other international investments.

(2)
Includes ancillary property revenues, gift cards, marketing, media, parking and sponsorship revenues, gains on sale of non-retail investments, non-real estate investments, insurance proceeds from business interruption and other miscellaneous income items.

(3)
The three months ended March 31, 2019 includes $83,582 related to the Opry Mills settlement and a gain on the sale of Phipps residential.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 20

Table of Contents

U.S. MALLS AND PREMIUM OUTLETS OPERATING INFORMATION (1)

 
AS OF MARCH 31,
 

 
2020
2019

Total Number of Properties

  168     176

Total Square Footage of Properties (in millions)

 

142.6
   
150.6

Ending Occupancy (2):

 

 
   
 

Consolidated Assets

  94.0%     95.1%

Unconsolidated Assets

  94.1%     94.9%

Total Portfolio

  94.0%     95.1%

Base Minimum Rent PSF (3):

 

 
   
 

Consolidated Assets

  $ 53.86   $ 52.70

Unconsolidated Assets

  $ 61.17   $ 58.67

Total Portfolio

  $ 55.76   $ 54.34

Open / Close Spread

     

RENT PSF
(BASE MINIMUM RENT & CAM)


     
         

 

SQUARE FOOTAGE
OF OPENINGS





AVERAGE
OPENING RATE
PSF  (4)






AVERAGE
CLOSING RATE
PSF  (4)





LEASING
SPREAD  (4)



SPREAD TO
CLOSE %

3/31/20

  7,948,232   $ 64.06   $ 61.26   $ 2.80   4.6%

12/31/19

    8,216,167   $ 62.39   $ 54.56   $ 7.83     14.4%

3/31/19

    7,499,068   $ 66.00   $ 51.83   $ 14.17     27.3%
(1)
Reported retailer sales per square foot were $673 for the trailing 12 months ended March 31, 2020. This was an increase of 2.1%; however, it was impacted by the Company's temporary closure of its U.S. retail properties effective March 18, 2020. This impact is shown by comparing the trailing 12 months ended February 29, 2020, sales per square foot of $703, an increase of 6.5%.
(2)
Ending Occupancy is the percentage of total owned square footage (GLA) which is leased as of the last day of the reporting period. We include all company owned space except for mall anchors, mall majors, mall freestanding and mall outlots in the calculation.
(3)
Base Minimum Rent PSF is the average base minimum rent charge in effect for the reporting period for all tenants that would qualify to be included in Ending Occupancy as defined above.
(4)
The Open / Close Spread is a measure that compares opening and closing rates on all spaces. The Opening Rate is the initial cash Rent PSF for spaces leased during the trailing 12-month period, and includes new leases, renewals, amendments and relocations (including expansions and downsizings) if lease term is greater than one year. The Closing Rate is the final cash Rent PSF as of the month the tenant terminates or closes. Rent PSF includes Base Minimum Rent and Common Area Maintenance (CAM) rents.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 21

Table of Contents

THE MILLS AND INTERNATIONAL OPERATING INFORMATION

 
AS OF MARCH 31,
 

 
2020
2019

The Mills

         

Total Number of Properties

 

14
   
14

Total Square Footage of Properties (in millions)

 

21.5
   
21.4

Ending Occupancy (1)

 

96.3%
   
97.4%

Base Minimum Rent PSF (2)

 
$

33.80
 
$

32.87

Leasing Spread PSF (3)

 
$

7.84
 
$

10.94

Leasing Spread (Percentage Change) (3)

 

21.5%
   
27.4%

 

 

 
   
 

International Properties

 

 
   
 

Premium Outlets

 

 
   
 

Total Number of Properties

 

20
   
19

Total Square Footage of Properties (in millions)

 

7.7
   
7.3

Designer Outlets

 

 
   
 

Total Number of Properties

 

10
   
9

Total Square Footage of Properties (in millions)

 

2.6
   
2.2

Statistics for Premium Outlets in Japan (4)

 

 
   
 

Ending Occupancy

 

99.4%
   
99.6%

Base Minimum Rent PSF

 

¥ 5,307
   
¥ 5,184
(1)
See footnote 2 on page 21 for definition, except Ending Occupancy is calculated on all company owned space.
(2)
See footnote 3 on page 21 for definition.
(3)
See footnote 4 on page 21 for definition.
(4)
Information supplied by the managing venture partner; includes 9 properties.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 22

Table of Contents

U.S. MALLS AND PREMIUM OUTLETS LEASE EXPIRATIONS (1)

YEAR

 


NUMBER OF
LEASES
EXPIRING




SQUARE FEET




AVG. BASE
MINIMUM
RENT
PSF AT 3/31/20







PERCENTAGE OF
GROSS ANNUAL
RENTAL
REVENUES (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

Inline Stores and Freestanding

                       

Month to Month Leases

   
1,081
   
4,075,884
 
$

49.65
   
3.5%

2020 (4/1/20 - 12/31/20)

    1,025     2,986,392   $ 58.80     3.0%

2021

    2,639     9,655,286   $ 50.96     8.5%

2022

    2,405     9,104,478   $ 49.67     7.9%

2023

    2,320     9,547,704   $ 56.08     9.3%

2024

    1,952     7,564,687   $ 59.46     7.7%

2025

    1,578     6,117,466   $ 63.18     6.8%

2026

    1,301     4,865,936   $ 62.62     5.4%

2027

    986     3,730,609   $ 65.62     4.3%

2028

    842     3,660,329   $ 60.90     3.9%

2029

    735     3,167,507   $ 63.83     3.4%

2030

    263     1,291,952   $ 59.52     1.2%

2031 and Thereafter

    357     2,356,489   $ 38.87     1.7%

Specialty Leasing Agreements w/ terms in excess of 12 months

    1,808     4,596,977   $ 18.29     1.5%

 

                       

Anchors

                       

2020 (4/1/20 - 12/31/20)

   
1
   
138,409
 
$

1.18
   
0.0%

2021

    7     932,523   $ 4.28     0.1%

2022

    16     2,033,754   $ 6.14     0.2%

2023

    17     2,386,762   $ 6.46     0.3%

2024

    24     2,027,154   $ 8.30     0.3%

2025

    17     1,676,634   $ 6.06     0.2%

2026

    9     886,371   $ 5.28     0.1%

2027

    6     920,224   $ 4.16     0.1%

2028

    9     857,119   $ 7.58     0.1%

2029

    4     511,660   $ 2.44     0.0%

2030

    8     824,573   $ 6.91     0.1%

2031 and Thereafter

    21     2,057,593   $ 10.70     0.4%
(1)
Does not consider the impact of renewal options that may be contained in leases.
(2)
Annual rental revenues represent 2019 consolidated and joint venture combined base rental revenue.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 23

Table of Contents

U.S. MALLS AND PREMIUM OUTLETS TOP TENANTS

Top Inline Store Tenants (sorted by percentage of total base minimum rent for U.S. properties)

TENANT





NUMBER
OF
STORES






SQUARE
FEET
(000'S)






PERCENT OF
TOTAL SQ. FT. IN
U.S. PROPERTIES





PERCENT OF TOTAL
BASE MINIMUM RENT
FOR U.S. PROPERTIES

 

                       

The Gap, Inc.

    412     3,843     2.1%     3.5%

L Brands, Inc.

    306     1,895     1.0%     2.2%

PVH Corporation

    234     1,464     0.8%     1.6%

Ascena Retail Group Inc

    389     2,096     1.2%     1.6%

Tapestry, Inc.

    251     1,017     0.6%     1.5%

Signet Jewelers, Ltd.

    364     526     0.3%     1.5%

Foot Locker, Inc.

    224     1,034     0.6%     1.3%

American Eagle Outfitters, Inc

    203     1,314     0.7%     1.2%

Luxottica Group SPA

    387     694     0.4%     1.2%

Capri Holdings Limited

    139     534     0.3%     1.2%

Top Anchors (sorted by percentage of total square footage in U.S. properties) (1)

TENANT





NUMBER
OF
STORES






SQUARE
FEET
(000'S)






PERCENT OF
TOTAL SQ. FT. IN
U.S. PROPERTIES





PERCENT OF TOTAL
BASE MINIMUM RENT
FOR U.S. PROPERTIES

 

                       

Macy's Inc.

    112     21,511     11.9%     0.3%

J.C. Penney Co., Inc.

    63     10,201     5.6%     0.3%

Dillard's, Inc.

    36     6,532     3.6%     *

Nordstrom, Inc.

    27     4,556     2.5%     0.1%

Dick's Sporting Goods, Inc.

    36     2,410     1.3%     0.6%

Hudson's Bay Company

    17     2,174     1.2%     0.1%

Sears

    11     2,040     1.1%     *

The Neiman Marcus Group, Inc.

    12     1,458     0.8%     0.1%

Belk, Inc.

    8     1,323     0.7%     *

Target Corporation

    6     831     0.5%     0.1%

Von Maur, Inc.

    6     768     0.4%     *
(1)
Includes space leased and owned by anchors in U.S. Malls; does not include Bloomingdale's The Outlet Store, Neiman Marcus Last Call, Nordstrom Rack, and Saks Fifth Avenue Off 5th.
*
Less than one-tenth of one percent.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 24

Table of Contents

CAPITAL EXPENDITURES
(In thousands)

     

UNCONSOLIDATED
PROPERTIES
   

 
CONSOLIDATED
PROPERTIES

 
TOTAL  
OUR
SHARE

New development projects

  $ 13,127   $ 56,871   $ 24,561

Redevelopment projects with incremental square footage and/or anchor replacement

   
168,888
   
72,182
   
35,492

Redevelopment projects with no incremental square footage (1)

   
20,962
   
10,905
   
5,585

 

                 

Subtotal new development and redevelopment projects

  202,977   139,958   65,638

Tenant allowances

   
33,888
   
20,198
   
10,332

Operational capital expenditures at properties:

                 

CAM expenditures

    10,448     11,996     5,021

Non-CAM expenditures

    901     5,355     2,018

 

                 

Totals

  $ 248,214   $ 177,507   $ 83,009

Conversion from accrual to cash basis

   
(35,000)
   
(15,952)
   
(7,460)

 

                 

Capital Expenditures for the Three Months Ended 3/31/20 (2)

  $ 213,214   $ 161,555   $ 75,549

        

                 

Capital Expenditures for the Three Months Ended 3/31/19 (2)

  $ 216,781   $ 188,229   $ 71,669
(1)
Includes restoration projects as a result of property damage from natural disasters.
(2)
Agrees with the line item "Capital expenditures" on the Combined Statements of Cash Flows for the consolidated properties. No statement of cash flows is prepared for the joint venture properties; however, the above reconciliation was completed in the same manner as the reconciliation for the consolidated properties.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 25

Table of Contents

DEVELOPMENT ACTIVITY SUMMARY (1)
As of March 31, 2020
(in thousands, except percent)

 

 

PLATFORM
    PROJECT TYPE


 
 


OUR SHARE
OF NET
INVESTMENT



 



EXPECTED
STABILIZED
RATE OF
RETURN




 


ACTUAL
Q1 2020
INVESTMENT



 


FORECASTED
Q2 - Q4
INVESTMENT



 


FORECASTED
FY 2020
INVESTMENT



 


FORECASTED
FY 2021
INVESTMENT



 



FORECASTED
TOTAL
INVESTMENT
2020 - 2021




 

 

Malls

                                 

 

 

Redevelopments

      $ 387,717         7%       $ 81,347       $ 105,675       $ 187,022       $ 33,771       $ 220,793    

 

 

 

                                                                         

 

 

Premium Outlets

                             

 

 

New Developments—U.S.

      $ 6,400               $ 6,400       $       $ 6,400       $       $ 6,400    

 

 

New Developments—International

      $ 83,325         8%       $ 18,409       $ 23,137       $ 41,546       $ 4,115       $ 45,661    

 

 

Redevelopments—U.S.

      $ 35,006         9%       $ 9,375       $ 17,487       $ 26,862       $ 966       $ 27,828    

 

 

Redevelopments—International

      $ 98,927         10%       $ 3,588       $ 43,344       $ 46,932       $       $ 46,932    

 

 

The Mills

                             

 

 

Redevelopments

      $ 61,981         10%       $ 6,027       $ 23,744       $ 29,771       $ 3,957       $ 33,728    

 

 

Total Investment(1)

    $ 673,356     8%     $ 125,146     $ 213,387     $ 338,533     $ 42,809     $ 381,342  

 

 

Less funding from: Construction Loans, International Joint Venture Cash on hand, etc.

    $ (246,182)         $ (28,468)     $ (91,204)     $ (119,672)     $ (8,631)     $ (128,303)  

 

 

Total Net Cash Investment

    $ 427,174         $ 96,678     $ 122,183     $ 218,861     $ 34,178     $ 253,039  
                                                                               

Notes:

(1)
Our share of Net Investment includes $320M of previous investment that was in construction in progress (CIP) as of December 31, 2019.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 26

Table of Contents

COMMON AND PREFERRED STOCK INFORMATION

                    CHANGES IN COMMON SHARE AND LIMITED PARTNERSHIP UNIT OWNERSHIP
                    
For the Period December 31, 2019 through March 31, 2020

 
COMMON
SHARES (1)

 


LIMITED
PARTNERSHIP
UNITS (2)

Number Outstanding at December 31, 2019

    306,868,960     46,740,117

First Quarter Activity

           

Exchange of Limited Partnership Units for Common Stock

    132,946     (132,946)

Redemption of Limited Partnership Units for Cash

        (116,072)

Restricted Stock Awards and Long-Term Incentive Performance (LTIP) Units Earned (3)

    (1,081)     38,148

Repurchase of Simon Property Group Common Stock in open market

    (1,245,654)    

Number Outstanding at March 31, 2020

    305,755,171     46,529,247

Number of Limited Partnership Units and Common Shares at March 31, 2020

    352,284,418      

                    PREFERRED STOCK/UNITS OUTSTANDING AS OF MARCH 31, 2020
                    
($ in 000's, except per share amounts)

ISSUER

  DESCRIPTION  
NUMBER OF
SHARES/UNITS

 


PER SHARE
LIQUIDATION
PREFERENCE


 


AGGREGATE
LIQUIDATION
PREFERENCE


 

TICKER
SYMBOL

Preferred Stock:

                           

Simon Property Group, Inc.

  Series J 8.375% Cumulative Redeemable (4)     796,948   $ 50.00   $ 39,847     SPGPrJ

Preferred Units:

                           

Simon Property Group, L.P.

  7.50% Cumulative Redeemable (5)     255,373   $ 100.00   $ 25,537     N/A
(1)
Excludes Limited Partnership preferred units relating to preferred stock outstanding.
(2)
Excludes units owned by the Company (shown here as Common Shares) and Limited Partnership Units not exchangeable for common shares.
(3)
Represents restricted stock awards and earned LTIP units issued pursuant to the Operating Partnership's 1998 Stock Incentive Plan and 2019 Stock Incentive Plan, net of forfeitures.
(4)
Each share is redeemable on or after October 15, 2027. The shares are traded on the New York Stock Exchange. The closing price on March 31, 2020 was $56.00 per share.
(5)
Each preferred unit is redeemable upon the occurrence of certain tax triggering events.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 27

Table of Contents

CREDIT PROFILE
(As of December 31, unless otherwise indicated)

 

GRAPHIC

(1)
Includes a charge for loss on extinguishment of debt of $0.38 per share in 2016, $0.36 per share in 2017, and $0.33 per share in 2019.
 
1Q 2020 SUPPLEMENTAL 1Q 2020 SUPPLEMENTAL 28

Table of Contents

SUMMARY OF INDEBTEDNESS
As of March 31, 2020
(In thousands)

 

TOTAL
INDEBTEDNESS


     


OUR
SHARE OF
INDEBTEDNESS



     



WEIGHTED
AVERAGE
END OF PERIOD
INTEREST RATE




     



WEIGHTED
AVERAGE
YEARS TO
MATURITY




 

Consolidated Indebtedness

                                                   

Mortgage Debt

                                                   

Fixed Rate

  $ 6,137,725           $ 5,999,815             3.87%             4.5    

Variable Rate Debt

    748,230             712,549             2.15%             1.8    

Total Mortgage Debt

    6,885,955             6,712,364             3.69%             4.3    

Unsecured Debt

       
 
 
 
       
 
 
 
       
 
 
 
       
 

Fixed Rate

    15,837,587             15,837,587             3.07%             9.1    

Revolving Credit Facility – USD Currency

    3,000,000             3,000,000             1.63%             5.2    

Supplemental Credit Facility – USD Currency

    875,000             875,000             1.53%             3.2    

Total Revolving Credit Facilities

    3,875,000             3,875,000             1.61%             4.8    

Global Commercial Paper – USD

    952,901             952,901             1.44%             0.2    

Global Commercial Paper – EUR

    91,304             91,304             (0.38)%             0.1    

Total Unsecured Debt

    20,756,792             20,756,792             2.71%             7.8    

Premium

    5,513             5,512                                

Discount

    (53,225)             (53,225)                                

Debt Issuance Costs

    (108,877)             (107,954)                                

Other Debt Obligations

    67,255             67,255                                

 

                                                   
                     

Consolidated Mortgages and Unsecured Indebtedness (1)

  $ 27,553,413           $ 27,380,744         2.95%       7.0