Friday, September 18, 2009

Simon Ready to Pounce on GGP Assets

Earlier this year several analysts suggested that Simon Property Group was in a good position to acquire some malls from General Growth Properties. Simon has weathered the current financial crisis relatively unscathed with plenty of cash to go asset shopping. According to this article from AllBusiness, Simon is on pretty solid ground.

“For the 12 months ended March 31, 2009, Simon recorded over $1.8 billion in operating cash flow. In addition, Simon maintains strong access to a wide variety of external capital sources. In 2009, the company has raised approximately $3.1 billion of external capital, including two series of common equity, two series of senior unsecured notes, and two mortgage loans. Pro forma for the capital raises in second-quarter 2009 to date, Simon had approximately $2.9 billion in cash on hand and approximately $3 billion in availability under its committed bank credit facility. As such, Fitch calculates Simon's liquidity surplus to be approximately $3.5 billion on a pro forma basis from March 31, 2010 to Dec. 31, 2010.”

On Tuesday, according to this story in Bloomberg, Simon CEO, David Simon, said the company is closely watching the availability of properties from GGP and may swoop in to cherry pick some malls.

Simon has already has a strong local presence. They own the Arundel Mills mall by BWI airport.