Simon Property Group was asked to close again the Cielo Vista Mall in El Paso, Texas last weekend as the number of Covid-19 cases in the area increases, CEO David Simon said Monday.
On October 7, the largest mall owner in America finally reopened all of its properties that had to close due to the pandemic. The last reopening was in Los Angeles County. However, with the closure of Cielo Vista, another round of shutdowns could emerge.
Outside of that closure, Simon said that all U.S. malls and outlet centers are reopened and traffic is continuing to improve every month.
El Paso County announced in late October that it would close all non-essential businesses for two weeks to stem the recent surge in Covid-19 cases that has overwhelmed local hospitals.
The United States exceeded 10 million coronavirus cases on Monday, while global cases exceeded 50 million. And the Country is setting record peaks of one day in some casesThis spurred some officials to reintroduce the restrictions to contain the virus.
“That’s the only one,” said Simon so far about the Cielo Vista Mall, the largest mall in El Paso. “I think closed malls are treated unfairly and inconsistently. … The level of inconsistency is very frustrating.”
“I don’t know if any further restrictions will be in place,” added the CEO when asked about the possibility of other malls in other states having to close. “We haven’t seen any evidence that our environment is spreading anything.”
Simon shares closed nearly 28% on Monday in a broader market rally. The stock is down 47% in 2020, increasing its market cap to $ 24.2 billion.
However, in extended trading, stocks fell about 5% after the company posted disappointing third quarter results. Total revenue decreased 25% from $ 1.42 billion a year ago to $ 1.06 billion. According to estimates by Refinitiv, analysts asked for $ 1.08 billion.
Simon said that his real estate occupancy, which includes Roosevelt Field Mall in New York and King of Prussia Mall in Pennsylvania, was 91.4% as of September 30, compared to 94.7% for the same period in 2019 .
The minimum base rent per square foot averaged $ 56.13, 2.9% higher than last year.
Some of the largest tenants in Simon’s portfolio based on the amount of rent they pay include gap, L brands, Macy’s and J. C. Penney. Earlier this year Simon took Gap to court for not paying rent during the pandemic.
As of Nov. 6, Simon has accumulated 85% of his billed rents for the third quarter, compared to 72% of the billed rents accrued at his US properties in the second quarter.
With BrookfieldSimon is contractually obliged to acquire most of Penney’s assets, including its real estate, outside of bankruptcy courts. Previously, Simon had taken two retailers, Brooks Brothers and Lucky Brand, out of bankruptcy with the help of apparel licensing company Authentic Brands Group.
“The company has a loyal, diverse, and inclusive customer base … and we expect we will continue to grow that customer [base] over time, “CEO Simon said Monday of the Penney deal, which has not yet been finalized.
Simon ended the third quarter with more than $ 9.7 billion in liquidity on his balance sheet, including $ 1.5 billion in cash and $ 8.2 billion of available capacity under his revolving credit facility and his fixed term loan.