Simon Says Investing in Tenants Is Good Business

Simon acquired Aeropostale in 2016 and helped turn that then-struggling teen-apparel chain around. The firm also owns a Starbucks franchise at its Del Amo Fashion Center, in Torrance, Calif., and just last week announced a deal to invest in an e-sports company that will open venues at its malls.

The Aeropostale deal helped Simon fill space at its properties with a healthy, traffic-driving tenant. It also “made a ton of money,” Simon said.

Now the landlord seeks to redevelop and boost its huge portfolio of properties and does not rule out additional investments in its tenants, the CEO said. “It’s very possible — we’re going to be very smart about it," he said. "We’re certainly as good as the private-equity guys when it comes to retail investment. And so I wouldn’t rule it out.”

The firm will take a selective approach to all this, said Simon. “We’ll work together on other distressed situations," he noted. "[But] we’re only going to buy into companies that we think have brands and that have the volume that is worth doing it.”

Forever 21 could be one tenant in need of such assistance. According to Bloomberg, the chain has asked its biggest landlords, including Simon, to consider buying a stake in its business.