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Simon Property Group

(SPG) - Get Simon Property Group, Inc. Report

, the country's largest mall owner, beat analyst estimates with 9.4% growth in third-quarter funds from operations amid strong leasing trends.

The real estate investment trust posted funds from operations, or FFO, of $369.5 million, or $1.30 a share, compared with $337.7 million, or $1.19 a share, a year earlier. Analysts expected FFO of $1.28 a share, according to Thomson First Call.

FFO is a common REIT performance metric that adds back depreciation expenses to net income.

"Strong growth in tenant sales and healthy releasing spreads for both our regional mall and Premium Outlet platforms are driving our results," David Simon, the company's chief executive, said in Monday's earnings release.

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Mall owners have underperformed the rest of the REIT sector in recent months but are seen as holding

good value.

Simon's revenue increased 5% to $818.7 million. Analysts, on average, expected a top line of $799.2 million.

Occupancy at the company's malls fell 10 basis points to 92.5%. Average rents rose 2.7% at the company's malls and increased 4.6% at its premium outlet centers.

The company also increased its guidance for 2006 FFO to $5.36 a share from its earlier projection of $5.30 to $5.35. The new forecast is slightly higher than the $5.33 consensus estimate.

Simon closed up 41 cents to $97.22 Monday. Earnings were released after the market closed.