Simon Property Hires at Spin-off Unit

Zacks

Simon Property Group, Inc. (SPG) is on track with its planned spin-off. After disclosing the appointment of the Chief Executive Officer (CEO), Mark Ordan last month for Washington Prime Group, Inc. – the unit that it decided to spin-off – the company announced major managerial appointments and 4 independent directors for Washington Prime Group’s board.

Simon Property stated that once the spin-off is accomplished, Myles Minton will join as the Chief Operating Officer, Robert P. Demchak as the General Counsel and Corporate Secretary and Michael J. Gaffney as Senior Vice President, Head of Capital Markets of Washington Prime Group. These individuals have been part of Simon Property for some years and held important positions.

In addition, the company announced 4 independent directors for Washington Prime Group. Notably, as disclosed earlier, Richard S. Sokolov, President and Chief Operating Officer of Simon Property Group will serve as the Chairman on the board.

As a matter of fact, Washington Prime Group, Inc. will operate as an independent, publicly traded real estate investment trust (REIT) and include the entire strip center business and smaller enclosed malls of Simon Property. It will initially own or have stake in 98 retail real estate properties – strip centers and malls, aggregating 53 million square feet in 23 states.

We believe this move is a step closer to the completion of the planned spin-off. The move would help this retail real estate investment trust (REIT) to increase utilization of resources for expanding its global portfolio of larger malls, mills and premium outlets. With the economy showing signs of recovery, spending of the richer consumers is improving and the company seems to leverage on this trend.

Simon Property currently carries a Zacks Rank #2 (Buy). Investors interested in the retail REIT industry may also consider stocks like Federal Realty Investment Trust (FRT), General Growth Properties, Inc. (GGP) and National Retail Properties, Inc. (NNN). All these stocks carry the same rank as Simon Property.

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