Morgan Stanley downgraded Simon Property to Equal Weight from Overweight with a price target of $143, up from $132. The discount to open air center peers has narrowed significantly from lows of -40% to -16% currently, and rising interest costs limits the firm’s FFO growth to 1%-2% in the next couple of years vs. high quality open air center peers in the mid single digits, the analyst tells investors in a research note. Morgan Stanley believes shares still offer a compelling dividend for value investors in the REIT space.
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