Why Simon Property Group Fell Over 10% on June 24

Shares of mall-focused real estate investment trust (REIT) Simon Property Group (NYSE: SPG) fell 10% in morning trading on Wall Street. That drop seemingly coincides with a material decline in the S&P 500 index, but there's more going on at this giant retail landlord than just a one-day shift in investor sentiment. And most of it isn't pretty.

The broader market sold off as states that had been early to reopen their economies following COVID-19-related shutdowns saw an uptick in coronavirus cases. That's bad news for Simon, which owns around 200 enclosed malls and outlet centers. If previous business and social restrictions are put back in place, the properties it owns will see foot traffic fall. That will make it even harder to collect rent from tenants, some of which have already chosen not to pay for the period that Simon's properties weren't open. The REIT, for example, is currently suing a key tenant over unpaid rent. So, it's understandable that Simon's stock fell as coronavirus concerns picked up.

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Source Fool.com