Can Amazon Save the Simon Property Group from Oblivion? — Market Mad House

Strangely, Amazon (NASDAQ: AMZN) could save the mall operator Simon Property Group (NYSE: SPG) from oblivion.

To explain, Amazon and Simon are discussing the conversion of 63 JC Penney (OTCMKTS: JCPNQ) and 11 Sears stores into e-commerce distribution hubs, The Wall Street Journal claims. Both department store chains have filed for Chapter 11 bankruptcy, The Real Deal reports.

Amazon could rent the department store buildings from Simon at a discount, The Real Deal speculates. Conversely, Simon Property and Brookfield Property Partners (NASDAQ: BPY) are contemplating an acquisition of JC Penney, The Real Deal claims.

Could Simon Property Buy JC Penney?

Brookfield, another mall operator, and Simon need JC Penney operating to collect enough rent to stay in business, retail consultant Soozan Baxter claims. Simon owns 63 JC Penney stores and Brookfield owns 99 JC Penney locations.

Penney’s plans to close 154 of the 860 stores it operated before bankruptcy this summer, CNBC estimates. The coronavirus closed all 860 JC Penney stores in March, but they reopened 500 of those locations in March. Hence, I estimate Penney’s needs to dispose of 360 stores.