Is Simon Property Group, Inc. (SPG) the Best REIT Stock to Buy Now?

We recently compiled a list of the 12 Best REIT Stocks to Buy Now. In this article, we are going to take a look at where Simon Property Group, Inc. (NYSE:SPG) stands against the other REIT stocks.

The US Real Estate So Far in 2025

While the mortgage rates have risen despite the Fed cutting rates, potential homebuyers are left with the choice to either postpone the homebuying or resort to current mortgage rates as well as elevated home prices. According to Freddie Mac, the 30-year fixed mortgage rate went above 7% in the week ended January 16. Experts are convinced that mortgage rates need to drop to 6% or lower for the housing market to come to life and rates above 7% deem the market dead where nobody is going to buy. Lee Baker, a member of CNBC’s Financial Advisor Council, reiterated the adverse situation saying:

“If what you’re hoping or wishing for is an interest rate at 4%, or housing prices to drop 20%, I personally don’t think either one of those things is remotely likely in the near term”

Another issue of concern has been the devastating wildfires in LA which have deepened its already existing housing shortage. Redfin reported that almost one of every six homes within the perimeters of the Palisades and Eaton fires have either been damaged, destroyed or are inaccessible. Meanwhile, the prices in the rental markets with more displaced turning to them.

According to the New York Times, the affectees would find it hard to find accommodation in a metro area that already had a shortage of around 337,000 homes, as of 2022. Data from the Los Angeles Department of Building and Safety reveals that apartment units approved by the city of Los Angeles dropped to a 10-year low in 2024. Victor M. Gordo, the mayor of Pasadena, exclaimed the issue at hand as follows:

“One of the biggest challenges ahead will be getting people who lost their homes into permanent, long-term housing”

Our Methodology:

In order to compile a list of the 12 best REIT stocks to buy now, we first use a stock screener to make an extended list of the relevant companies with the highest market caps. Moving on, we shortlisted the top 12 stocks from our list which had the highest number of hedge fund holders. The 12 best REIT stocks to buy now have been arranged in ascending order of their hedge fund holders as of Q3.

At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

A rooftop view of a bustling downtown area, emphasizing the company’s investments in the real estate sector.

Simon Property Group, Inc. (NYSE:SPG)

Number of Hedge Fund Holders: 48

Simon Property Group, Inc. (NYSE:SPG) is an REIT that engages in the ownership of premier shopping, dining, entertainment, and mixed-use destinations. The REIT owned or held an interest in 196 income-producing properties in the US, comprising 93 malls, 70 Premium Outlets, 14 Mills, six lifestyle centers, and 13 other retail properties in 37 states and Puerto Rico, as of September 30. Internationally, Simon had ownership in 35 Premium Outlets and Designer Outlet properties primarily located in Asia, Europe, and Canada.

With three decades in operation, Simon Property Group, Inc. (NYSE:SPG) has demonstrated growth, resilience, and innovation in becoming the preeminent owner and operator of best-in-class retail real estate properties, with scale. Simon’s portfolio remains differentiated by product type, geography, and tenant mix. This portfolio includes properties like shopping centers, many generating $100 million or even higher in annual NOI. No other real estate type can match the longevity, embedded future growth, and NOI generation of these centers. Simon is one of the largest landlords to the world’s most important retailers.

The Chief Executive Officer, David Simon, was pleased with the strong financial and operational performance as well as the successful openings of Tulsa Premium Outlets and the expansion of Busan Premium Outlets in Q3 2024. Funds From Operations (FFO) was $1.067 billion, up from $1.201 billion in the prior year. Year over year, Domestic property NOI climbed 5.4% and portfolio NOI rose 5%.

Overall SPG ranks 5th on our list of the best While we acknowledge the potential of SPG as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than SPG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.

Disclosure: None. This article is originally published at Insider Monkey.