Simon Property Group Inc.
), an equity real estate investment trust (REIT), has declared to
spin-off Washington Prime Group Inc. As per the announcement, all
the common shares of Washington Prime will be distributed to
Simon's stockholders on May 28, 2014, on a pro rata basis.
Upon the completion of this spin-off, Washington Prime will
become an independent and publicly-traded company. It will be
listed in the New York Stock Exchange under the ticker WPG.
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The latest move is in line with Simon's strategy to focus more on
its global portfolio of larger malls, mills and premium outlets.
Earlier in December last year, Simon spun off its smaller
enclosed malls and strip center business. With this development,
Bethesda, MD-based Washington Prime will own 54 strip centers and
44 smaller enclosed malls across U.S, covering an area of
approximately 53 million square feet.
Currently, Indianapolis, IN-based Simon owns over 325 retail real
estate properties in North America, Asia and Europe, covering
around 242 million square feet area. As per the announcement,
every shareholder of Simon is entitled to receive one common
share of Washington Prime for every two common shares of Simon
held as on May 16, 2014. For fractional shares, the shareholders
of Simon will receive cash.
The spin-off is, however, subject to fulfillment of certain terms
and conditions by Washington Prime. Notably, Goldman Sachs &
Co. and BofA Merrill Lynch are serving as the financial advisors
and Wachtell, Lipton, Rosen & Katz as the legal advisors to
Simon currently holds a Zacks Rank #3 (Hold).
Some better-ranked REITs include
Acadia Realty Trust
Agree Realty Corp.
General Growth Properties, Inc
). All of these stocks carry a Zacks Rank #2 (Buy).