EPRA 2015: David Simon, chairman and chief executive of retail giant Simon Property Group, says that he offered a fair price for Capital Shopping Centres, now Intu, in 2010.
During a wide-ranging interview at the EPRA conference in Berlin that touched on his company’s 28.7% stake in French shopping centre Klépierre and its failed bid for CSC, Simon added that he was “out of the big deal business”.
Simon expressed frustration at the Intu deal’s failure, saying that he offered a fair price for the company which in the five years since has still not been achieved.
Instead of doing a deal with Simon, CSC chose to sell a stake in the company in exchange for The Trafford Centre, which saw the Manchester centre’s owner, John Whittaker, become a major shareholder.
Simon has been highly active in Europe in recent years, having been personally central to Klépierre’s merger with Corio earlier this year and Klépierre’s €2bn (£1.4bn) sale of its Carrefour portfolio in early 2014.
His experience of the US markets also prompted Simon to suggest that Europe, despite its success in sales growth, needed to change its focus from consumers to retailers as it caught up with the trends in the US.
Simon suggested that Europe was two to three years behind the US in the cycle, which has seen considerable changes to the way people shopped.
He noted increasing pressure on shopping malls and high streets by internet retailers, which meant that consumers were shopping in fewer higher-quality outlets than before.
“Malls are no longer a dump box,” he said, adding that shopping in malls should now be a more efficient experience for consumers.
Working with retailers was, he suggested, more important than ever in enhancing the offering to consumers and keeping them on site spending for longer periods.
He said that retail sector investors should not fear internet companies but embrace them. His company is working with online jeweller Blue Nile to create outlets for the brand.
This is a trend that will be carried on into Europe he said, as internet retailers struggle with the cost of shipping and regional tax variations.
Overall, he predicted relatively weak growth in US business as it struggles with the fallout of not just China’s stock market fall but growing economic problems in Brazil.
