Zacks_Analysts' Blog : Simon Agrees to Form JV - Analyst Blog

Simon Property Group, Inc. (SPG), Woodmont Outlets and EWB Development LLC recently agreed to create a joint venture agreement for the development, construction, leasing and management of St. Louis Premium Outlets. Simon Property will own a 60% stake in this project.

The new upscale outlet center which is spread across 55 acres will anchor the mixed-use property under development named Chesterfield Blue Valley in Chesterfield, Missouri. The new outlet center is a part of Simon Property Group's premium outlets platform, which is well known with 69 properties worldwide.

The location of the new center is another advantage as it is one of the most affluent communities in the metro area with good transportation network on the south side of I-64/US highway 40. The site is located near  a community of 2.8 million people with an average household income of $95,000.

The mixed used outlet center includes office space, hotel, restaurant and entertainment venues. The community has a lot of scope for further expansion and there is an additional 75 acres available for mixed-use development within Chesterfield Blue Valley.

Headquartered in Indianapolis, Indiana, Simon Property is the largest publicly traded retail real estate company in North America, engaged in acquiring, owning and leasing a diverse portfolio of shopping malls.

Furthermore, the company’s international presence gives it a more sustainable long-term growth story than its domestically focused peers. The geographic and product diversity of the company is a hedge against market volatility and assures a steady source of income.

Simon Property currently retains a Zacks #2 Rank, which translates into a short-term Buy rating. One of its competitors, Macerich Co (MAC) also holds a Zacks #3 Rank, which translates into a short term Hold rating.