Simon Property (SPG) Begins Construction At Denver Outlet
Zacks Investment Research | Oct 09, 2017 12:02AM ET
Simon Property Group, Inc. (NYSE:SPG) announced the ground breaking at the Denver Premium Outlets — a Thornton, CO-based open air shopping center— encompassing 330,000 square feet of space.
Scheduled to open in the fall of 2018, the project is Colorado’s first premium outlet in development. The center is positioned at the intersectionof Interstate 25 and 136 Avenue, and will house around 80 high-end brands and retailers, similar to those found in other Simon Premium Outlets. The center will offer everyday savings of 25-65% on a wide range of outdoor and fitness apparel and footwear, electronics, fashion accessories and home furnishing, among others.
The property will likely draw high footfall as the Denver metro area demonstrates solid economic and population growth. Moreover, development projects worth nearly $350 million are currently under construction in close vicinity to the shopping center. This reflects the strong trade demographics and retail-growth potential of that area.
The property will serve the Greater Denver community with a wide array of offerings, including premium brands, shopping and dining options. The overall project will generate substantial construction and permanent jobs in the area, creating as many as 500 construction jobs, and 700 part- and full-time jobs.
Notably, at a time when increasing consumer purchases through the Internet have emerged as a pressing concern for retail real estate investment trusts (REIT), Simon Property is making concerted efforts to make its property stand out from the rest. Hence, such omni-channel retailing initiatives augur well for the company’s long-term profitability. Further, as the city’s only premium outlet, Denver Premium Outlet is anticipated to enjoy competitive advantage over other retail malls.
Denver Premium Outlets is Simon Property’s 92nd Premium Outlets center. Additionally, over the last five years, the retail REIT invested over $5 billion in development projects, and intends to spend around $1 billion in each 2017 and 2018. With such a huge pipeline, the company is well poised to effectively leverage the improving spending habits of wealthier customers amid an improving economy.
However, due to the gloomy retail market, Simon Property has underperformed its Zacks Investment Research
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