Now, he has a holiday to prove it — National Outlet Shopping Day, a two-day event this weekend.
It’s not so much a return to Simon’s roots in real estate, but a reminder that he never left and that he is still pushing hard in brick-and-mortar, getting developments back under way and starting up again with new centers.
Simon has taken a series of high-profile stakes in brands that once would have been more likely to be tenants than part of the family, including J.C. Penney, and, through the SPARC joint venture, Reebok, Brooks Brothers, Forever 21, Lucky Brand, Eddie Bauer and more.
And while that has kept the retail side of Simon in the spotlight, his property business is still at the center of Simon Property.
“Our retail venture does overshadow what we do in our day job,” Simon told WWD. “Our day job is, hopefully, owning really good retail real estate.”
“Ninety-two percent of our earnings are essentially related to the core business, which is owning real estate,” he said. “That will always be our focus. But we’re proud of what we have done in our partnership, primarily with [Authentic Brands Group] in SPARC and at Penney because, not only have we been able to financially benefit, but we’ve saved brands and jobs. That shouldn’t be overlooked. With these jobs come all the stuff that funds the infrastructure.”
Take National Outlet Shopping Day as another sign of opening up in retail.
The event was being planned for 2020, but was shelved given the pandemic. Now it’s on and in full force, a kind of retail answer to Amazon Prime Day at a time when consumers are getting back out to stores.
“It’s a good time of year to go out and about and we want to thank the customer for visiting our outlets and reinforce the real benefit of our outlet shopping, which is getting great brands at real value,” Simon said.
Gary Duncan, president of Simon’s Premium Outlets and The Mills businesses, added: “We have a big opportunity to reach a lot of customers at a time that’s after Memorial Day, before the Fourth of July sales, before back to school. It gives us a sweet spot to accentuate what we can provide. You see shoppers coming out in force. Everything is opening up.”
The world — in retail and beyond — is, of course, far from perfect.
Inflation is running at 40-year highs in the U.S., there’s a land war in Europe, the pandemic is still weighing heavy and the supply chain backups linger.
Amid it all, Simon said there is a chance for the U.S. to shine.
While lower-income consumers have shown signs of feeling the pinch of inflation, shoppers further up the price scale continue to have spending power and have proven to be keen to use it.
“We have something in the U.S. that I hope we don’t screw up,” Simon said, noting that larger divisions tearing up the country could still dampen the outlook. “We are going to be the bastion for growth worldwide.”
“The international retailers, they discovered that the U.S. is more than just two or three cities,” Simon said. “It’s across the country, there’s growth in the Austins and the Nashvilles of the world and demand is just way up.”
Simon, as a retailer, is also looking to take advantage of a retail scene that could become a little less global on the back end.
“I charged our guys at SPARC to say we can start manufacturing some of our goods here in the U.S.,” Simon said. “I am just really bullish on the U.S.”
Through the company’s retail operations, Simon also sees the allure of e-commerce in a new light, but said the industry still needs to really figure out the right balance.
“Brick-and-mortar is absolutely growing,” the CEO said. “E-commerce for most brands is slowing down. The whole industry chased internet sales — which I get because of the valuation for dot-com — but the reality is for many of them, because of the cost of shipping, distribution and returns, it’s still not profitable.
“The industry ultimately needs to figure out how to do this profitably,” he said. “The whole financial equation needs to be accessed and, I think, if it is, it will ultimately result in the brick-and-mortar being more important.”
Hence, a new holiday so big it needs two days. (“We’re a promoter, just like everybody else,” Simon acknowledged).
The National Outlet Shopping Day will be held at 90 Simon Premium Outlets and Mills properties nationwide.
Featuring exclusive deals and giveaways, the event is headlined by a $75,000 grand prize that includes a VinFast VF 8 electric vehicle and a $20,000 shopping spree. To win, shoppers have to post a selfie in front of a National Outlet Day selfie station, promotional signage or a shot of their shopping haul, tagging the outlet center, @Vinfast and #NOSDGiveaway.
While there’s a digital hook to win the prize, Simon’s commitment to brick-and-mortar in an ever-more logged-in world is clear in the company’s development work.
On Thursday, the company said it would:
- Begin the fifth phase of expansion at the Woodbury Common Premium Outlets in New York’s Hudson Valley, adding 160,000 square feet with new shops, additional parking and two hotels. Construction is set to begin in 2024.
- Resume development of a 400,000-square-foot, high-end fashion outlet and value-oriented center along the I-405 freeway in Carson, California, 11 miles from the Los Angeles International Airport. The 40-acre site is expected to see work begin this year with an agreement in principle in place with the city of Carson with the center opening in 2024.
- Develop a 300,000 square-foot luxury Premium Outlet in the Nashville area with the locally based Adventurous Journeys Capital Partners.
- Resume development of the 330,000 square foot Tulsa Premium Outlets in Jenks, Oklahoma, with the grand opening seen in 2024.
Clearly, it’s brick-and mortar all the way for Simon.
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