25YEARS 2018 ANNUAL REPORT ANNUAL 2018 CELEBRATING CELEBRATING

SIMON PROPERTY GROUP, INC. 2018 ANNUAL REPORT LIVE WORK PLAY STAY SHOP

CONTENTS

II FROM THE CHAIRMAN, CEO & PRESIDENT IV FINANCIAL HIGHLIGHTS VIII INVESTMENT HIGHLIGHTS XI SUSTAINABILITY HIGHLIGHTS XII & MANAGEMENT 1 10-K 54 MANAGEMENT’S DISCUSSION & ANALYSIS 74 FINANCIAL STATEMENTS

Simon Property Group, Inc. (NYSE: SPG) is an S&P 100 company and a leader in the global retail real estate industry. THE SHOPS AT CRYSTALS , NV

2018 ANNUAL REPORT I FROM THE CHAIRMAN, CEO & PRESIDENT DEAR FELLOW SHAREHOLDERS,

On December 14, 2018, we celebrated with great pride (but little fanfare) our 25th anniversary as a . Over the last 25 years, like many companies and industries, we have dealt with seismic shifts within our industry. In our case, these changes have forced us to be better operators, more thoughtful and astute capital allocators and willing to invest in our business with conviction, despite the ever-changing environment. David Simon Chairman, CEO & Some of the more meaningful many pundits have tried to kill • Lead the industry in successful President shifts of the last 25 years in our off physical retail real estate and and profitable acquisitions, industry include (but, of course, yet, even with these constant where we can add value. are not limited to): challenges, this has only made us • Export our “know-how” stronger and more profitable. • The dramatic increase in the internationally. adoption of mobile, digital and Certainly our priorities and Our overriding strategy has e-commerce. approach change, but the provided us with the foundation • The changing demographics strategy we laid out several years to adapt quickly to both and psychographics of our ago has enabled us to prosper in economic cycles and the consumer, i.e., aging Baby today’s volatile business climate. changing role that our shopping versus the ever- As a reminder, our strategy destinations have for our changing Millennial. includes some of the following consumers. elements: • The barbell effect on consumer My job (not solely) as I have said spending, i.e., the need and • Focus on the ownership of high- before is to balance the two “P’s” desire for value on one hand quality retail real estate. (Product and Profitability). How versus the higher-end consumer • Increase our presence in major we make our product better and seeking unique luxury products metropolitan markets. at the same time continue to and services on the other. grow our profitability. It is with • Own assets along the price this focus that I am pleased to • The Great Recession and all spectrum of retail real estate, billion report another year of record $ 5.7 the psychological changes that dealing with the barbell Consolidated results for 2018, and I also take Revenue occurred with it. effect (from value to luxury great pride as we look over our • consumers). The transient role of brands now complete 25-year history as today versus 25 years ago. • Lead the industry in promoting a public company. $2.4 billion • The evolutionary role of our shopping destinations as Net Income department stores. a “Marketing Medium” and Consistent outperformance, connecting with our community whether it’s measured through • Over-leveraged retailers cash flow growth, value creation primarily as a result of leveraged and consumer directly and being less reliant on the retailers or returns to shareholders, $4.3 billion buyouts and significant stock has been a hallmark of Simon FFO to do that. buybacks resulting in lack of Property Group (“SPG”, “Simon” • investments in their business Densify our well-located real or the “Company”). Over the and many failures. estate with elements that decades, we have carefully grown foster a live, work, play and $5.7 billion • The rise of social media and the our Company to be the global Our Share impact on the consumer. stay environment including leader it is today. We are laser- of Total NOI apartments, office, hotels, These are just examples of some focused on our leasing activities, entertainment, restaurants, property management operations of the major disruptions we have and health and wellness. adjusted to over the last 25 years. and capital structure, so that we $7.9 0 Dividends can be as creative, efficient and Per Share During the last quarter-century,

II SIMON PROPERTY GROUP, INC. nimble as possible. We continue to differentiate ourselves by seeking to grow our business while striving to do what is best for our stakeholders and the communities in which we operate. It is with great appreciation and admiration for the entire organization that I would like to highlight some of our achievements over the last quarter-century. At the time of our December, 1993 IPO, our portfolio was THE SHOPS AT CLEARFORK Fort Worth, TX concentrated in suburban, middle market mall properties. Over the course of the next industry measure, has grown • Net income was $2.437 billion, reinforces the importance of decade, we completed a series from $150 million at the or $7.87 per share (record). high-quality brick-and-mortar of thoughtful, accretive, value- time of our IPO to more than • FFO increased 7.6% to locations to a retailer’s strategy. enhancing acquisitions of high- $4.3 billion in 2018. $4.325 billion, or $12.13 per • The $661 per square foot quality regional mall portfolios • We have increased the diluted share (record). retailer sales productivity is a and individual assets in major Company’s annual FFO • Achieved a compound annual long way from the $240 per metropolitan areas that served generation by more than twenty- FFO per share growth rate of square foot productivity our as a source of growth for our five times since our IPO. 8% over the last four years. portfolio generated in 1993. Company. In the process, • Total consolidated revenue has An increase of more than we created an unparalleled • Total portfolio net operating increased more than thirteen 175% over the 25 years. organization in the retail real income grew 3.7%, or more times from $424 million to estate industry. We recognized than $230 million year-over- approximately $5.7 billion. the consumer’s penchant for year, to $6.464 billion (record). RETURNING CAPITAL TO SHAREHOLDERS brands at value prices, so we • The gross market value of our • Comparable property NOI • Capital returned to shareholders added the Premium Outlets® portfolio has increased from increased 2.3% for our U.S. in 2018 totaled nearly and The Mills® platforms to $3.5 billion to more than Malls, Premium Outlets® and $3.2 billion, comprised of our portfolio. $90 billion. The Mills®. $2.8 billion in dividends and • From our IPO through year- With Simon’s global brand • Generated over $1.5 billion more than $350 million in share end 2018, ownership of Simon name recognition, it was in excess cash flow, after buybacks. natural and beneficial for us to Property Group (SPG) common dividends. stock provided a total return • Common stock dividends paid expand internationally. From our • We are pleased our stock once in 2018 were $7.90 per share, ® to shareholders of more than Premium Outlets in Asia, Mexico again outperformed our direct an increase of 10.5% from 2017, and , to our Designer 2,750%, or a compound annual return of more than peers as well as the S&P 500, and we expect to distribute at Outlets in Europe and Canada in 2018. least $8.20 per share in 2019. with McArthurGlen and our 14% compared to the S&P 500 investment in Klépierre, a leading compound annual return of • We have paid more than pan-European pure play retail 9% over the same period. OPERATING METRICS $28 billion in dividends over property company, our global As our portfolio has grown, we We again delivered strong our 25-year history as a public reach provides retailers access have also improved the quality operational results: company, and at our current dividend rate, by the second to an irreplaceable portfolio of of our assets, decreased our • Occupancy for our U.S. Malls quarter of 2019, we will have high-quality retail assets in high- leverage and vastly increased and Premium Outlets® ended cumulatively paid more than barrier-to-entry markets. the diversity of our income the year at 95.9% and The $100.00 per share in dividends generation. Approximately Mills® occupancy ended the Our focus on improving our since our IPO. Especially 48% of our net operating income year at 97.6%. product, through expansions, (“NOI”) now comes from our considering that our IPO price • Our U.S. Malls and Premium densifications, greater know- malls platform, 42% comes from was $22.25 per share—WOW! how and evolving and changing Outlets® occupancy has been our value platforms (Premium • We repurchased approximately the tenant mix, has resulted in over 95% for the last seven Outlets® and The Mills®) and 8.1 million shares for increasing the cash flow of years, even with the challenges 10% from our international approximately $1.4 billion, our assets. our industry has faced from platform. in total, under our stock retailer bankruptcies and store Through disciplined execution, repurchase program that was With that backdrop, let’s turn to closures. authorized in 2015. our strategy has resulted in the 2018 highlights. • Reported retailer sales across industry-leading results, year in • Earlier this year, your Board our portfolio were $661 per and year out. Our Company has of Directors authorized a new square foot, an increase of more achieved growth and scale that FINANCIAL RESULTS $2 billion stock repurchase than 5% year-over-year. few could have imagined possible We continued our track record of program. and the following are just some of posting record financial results in • Retailer sales productivity the impressive numbers to report 2018, including: has increased each quarter over the last 25 years: for the last two years, and all • Consolidated revenue increased platforms ended 2018 at record • Our annual funds from more than 2% to $5.658 billion levels. This productivity further operations (“FFO”), an important (record).

2018 ANNUAL REPORT III FINANCIAL HIGHLIGHTS

Year ended December 31. Dollars in millions, except per share figures. 2018 2017 Consolidated Revenue $ 5,658 $ 5,539 Net Income Per Share (Diluted) 7. 8 7 6.24 Funds from Operations (FFO) 4,325 4,021 FFO Per Share (Diluted) 12.13 11.21 Dividends Per Share 7. 9 0 7.1 5 Common Stock Price at December 31 1 6 7. 9 9 171.74 Total Equity Capitalization 59,855 61,573 Total Market Capitalization(1) 90,156 93,050 (1) Includes our share of consolidated and joint venture debt.

CONSOLIDATED OUR SHARE OF FFO PER DIVIDENDS PER REVENUE TOTAL NOI DILUTED SHARE DILUTED SHARE $ IN BILLIONS $ IN BILLIONS 5.54 5.44 5.53 $12.13 $7.90 $5.66 $5.71 5.27 $ 11.21 $ $ $ 4.87 $ 7.15 10.49 5.16 $ $ $ 9.86 4.96 $ 4.84 $ 6.50 $ 8.90 $ $ $ 6.05 $ 5.15 $

1415 16 17 18 1415 16 17 18 1415 16 17 18 1415 16 17 18

This annual report contains a number of forward-looking statements. For more information, refer to the Company’s fourth quarter and full-year 2018 results and SEC filings on our website at investors.simon.com. This report also references non-GAAP financial measures including funds from operations, or FFO, FFO per share, our share of otalt net operating income, or NOI, portfolio NOI growth and comparable property NOI growth. These financial measures are commonly used in the real estate industry and we believe they provide useful information to investors when used in conjunction with GAAP measures. For a definition of FFO and reconciliations of each of the non-GAAP measures used in this report to the most directly comparable GAAP measure, refer to the Company’s fourth quarter and full-year 2018 results, SEC filings and Non-GAAP Reconciliations section under Financials at investors.simon.com.

TOTAL RETURN PERFORMANCE 200

$150.33 150 $146.27 $141.46

100

Simon Property Group, Inc. 50 FTSE NAREIT Equity REIT Index 12/31/13 12/31/14 12/31/15 12/31/16 12/31/17 12/31/18 S&P 500 Index

COMPOUND YEAR-END 2018 ANNUAL RETURN ANNUAL 2013 2014 2015 2016 2017 2018 RETURN 3-YEAR 5-YEAR Simon Property Group, Inc. $ 100.00 $ 131.19 $ 144.61 $ 136.63 $ 137.96 $ 141.46 2.5% −0.7% 7.2% FTSE NAREIT Equity REIT Index $ 100.00 $ 130.14 $ 134.30 $ 145.74 $ 153.36 $ 146.27 −4.6% 2.9% 7.9% S&P 500 Index $ 100.00 $ 113.69 $ 115.26 $ 129.05 $ 157.22 $ 150.33 −4.4% 9.3% 8.5%

The line graph above compares the percentage change in the cumulative total shareholder return on our common stock as compared to the cumulative total return of the S&P 500 Index and the FTSE NAREIT Equity REIT Index for the period December 31, 2013 through December 31, 2018. The graph assumes an investment of $100 on December 31, 2013, a reinvestment of dividends and actual increase in the market value of the common stock relative to an initial investment of $100. The comparisons in this table are required by the Securities and Exchange Commission and are not intended to forecast or be indicative of possible future performance.

IV SIMON PROPERTY GROUP, INC. • We have an additional 25 plus opportunities from the recapture of department store spaces in various stages of development. Opportunities to enhance the value of our well- located real estate with diverse uses will be a driver of growth for our Company. • Our redevelopment activities will continue to create modern and innovative live, work, play, stay and shop communities that will complement our retail destinations.

NEW DEVELOPMENT • We still believe in selective new development. • We opened Denver Premium Outlets, a 328,000 square foot outlet center located THE FORUM SHOPS AT CAESARS PALACE Las Vegas, NV in Thornton, Colorado. The center features breathtaking Atlanta, Georgia, and Southdale views of the majestic Rocky BALANCE SHEET REDEVELOPMENT AND Center in Edina (Minneapolis), Mountains skyline with state-of- • Thoughtful balance sheet DENSIFICATION OF OUR Minnesota. These projects the-art amenities including an management is a fundamental IRREPLACEABLE REAL range in scope from new interactive Play Park for children strength of our Company ESTATE AND RECAPTURE anchors to the addition of of all ages, an outdoor fireplace and we continue to have the OF DEPARTMENT STORES specialty retail, restaurants, and a canine watering station— strongest balance sheet in • We completed more than fitness resorts, office, and all designs and features that our industry. 30 redevelopment projects hotel. At , we are provide a sense of placemaking. across all of our platforms in • redeveloping the former • We announced a 50/50 joint Amended and extended our the U.S. and internationally. $3.5 billion unsecured multi- department store into a new venture to create Los Angeles currency revolving credit facility • Our total investment in 150-room Nobu Hotel and Premium Outlets in Carson, with a lower pricing grid for five redevelopment projects in Restaurant, Life Time Athletic, , a state-of-the-art years, further enhancing our 2018 was approximately Life Time Work, 13-story outlet destination designed to strong financial flexibility. $600 million with an average Class A office building and attract affluent local residents yield of approximately 8% and other food and beverage and international tourists. This • Expanded our commercial paper our redevelopment project operators. The transformation will be an exciting project, on facility program to $2 billion. pipeline is approximately of this former department store well-located real estate, in one • Our industry-leading balance $3.5 billion and growing. space will significantly enhance of the country’s most attractive sheet metrics at the end of • Redevelopments and the value of our existing markets and in the heart of 2018 included: expansions were completed at shopping destination and blend Los Angeles County. seamlessly into the surrounding –– Net debt to NOI was in Miami, Florida; • Since 2012, we have invested catchment area. 5.1 times—the lowest in Del Amo in approximately $7.0 billion our sector Torrance, California; Desert Hills • Determining the proper in redevelopment and new –– Interest coverage ratio was Premium Outlets in Cabazon replacement use for former development projects. (Palm Springs), California; department store spaces 5.1 times • We have an identified pipeline in Houston, Texas; is not a one-size-fits-all –– Long-term issuer rating of of more than $5.0 billion, which in Boston, formula. It varies by location A / A2 continues to be the includes $1.5 billion in new Massachusetts; Town Center and how we can best highest in the real estate development and $3.5 billion in at Boca Raton in Boca Raton, redevelop the real estate. For industry redevelopment and expansion example, at in Florida; and in opportunities, with an expected • Our liquidity is more than Seattle, Washington, we are Chicago, Illinois, to name just investment of more than $7.5 billion and we have minimal re-imagining this 60-year-old a few. $1.0 billion per year in 2019 and financing requirements over the center to include NHL Seattle’s • We opened more than 2020. We expect to fund these next two years. Corporate Headquarters and 40 anchor/specialty tenants future growth opportunities on practice facility, one million • Our balance sheet provides a in 2018 and expect to open a financially accretive basis with square feet of Class A office, distinct advantage and should another 35 projects in 2019. our excess cash flow. not be overlooked. We have the over 1,000 residential units • At the end of 2018, we had financial flexibility and access to and approximately 375 hotel 10 former department store multiple sources of capital that, rooms, all served by a new mass INTERNATIONAL space redevelopment projects when coupled with our excess transit solution. This current • Our international platform under construction with cash flow, enables us to pursue retail-only will be contributes 10% of our earnings an aggregate gross cost of growth opportunities. completely transformed upon and is extremely profitable. approximately $725 million our completion. including Phipps Plaza in

2018 ANNUAL REPORT V Palo Alto, CA

PREMIUM OUTLET COLLECTION EDMONTON INTERNATIONAL AIRPORT ST. JOHNS TOWN CENTER Jacksonville, FL Edmonton, Canada

• Expanding our international projects is estimated to be restaurants opened across our • Continued to open locations business has been an important approximately $100 million and portfolio in 2018. for new luxury brands including component of our long-term will generate an average yield of • Continue to add sophisticated Aquazarra, Ba&sh, Eton, Golden growth strategy and further approximately 8%. restaurants to our portfolio Goose, Paige, Sergio Rossi, and strengthens our relationship • We have broken ground on our including North Italia at Fashion Zimmerman, to name a few. with global retailers. fi rst Premium Outlet in Bangkok, Valley, Blanco Tacos + Tequila • Whether it is working with • We opened Premium Outlet Thailand. at , Water Grill and new brands or international Collection Edmonton • We have six signifi cant Frida Mexican Cuisine at The retailers seeking to establish a International Airport, a expansions under construction Forum Shops to name a few. presence in the , 428,000 square foot outlet in Canada, Italy, Japan, South • Our portfolio generates nearly our leasing team’s goal is to center located in Edmonton, Korea, and the United Kingdom, $4 billion in annual food sales create opportunities for retailers Canada. The only fully enclosed all expected to open in late 2019 per year through more than looking to bring their retail ideas outlet shopping center in the and early 2020. This includes 2,500 restaurants/dining to life. Edmonton Metropolitan area the expansion of the highly . features 100 fashion brands and productive Gotemba Premium • MARKETING outlet stores, as well as a variety Launched unique entertainment Outlets in Japan. • Our marketing strategy is of signature services: from the concepts to create interactive • focused on the most creative delivery of purchases directly Our 21% investment in Klépierre experiences. Added more than and innovative content and to guests’ homes to fl ight continues to grow in value as 20 new entertainment/lifestyle media platforms to drive information and refresh facilities they execute on their strategy concepts to our portfolio in awareness, shopper traffi c for travelers. to enhance the quality of their 2018, including Peppa Pig World leading pan-European pure of Play, Ten Pin Eatery, XD Ride and sales for the brands and • Signifi cant expansions were play retail property company, Adventure, Pinstripes, and retailers in our centers and completed at Johor Premium resulting in record results Blocks to Bricks. create engagement with our Outlets in Malaysia, Shisui consumer. despite a challenging European • Premium Outlets in Japan and With brick-and-mortar stores economy. • Our marketing team as the cornerstone of any • collaborates with leading in Canada. I am still amazed we can successful retailer’s strategy, operate from we continued to open locations brands on cutting-edge virtual • Total gross costs invested to Thailand on an extremely for many formerly online- reality activations to drive store in these four international profi table basis. only retailers such as Casper, traffi c and on localized digital development projects was Cuyana, Eloquii, Fabletics, campaigns to build awareness approximately $325 million with Fashion Nova, Hope & Henry, for in-store initiatives. an average cash yield on cost LEASING AND NEW Indochino, Modcloth, Peloton, • We have more than 8 million of 8%. CONCEPTS OPENED • We signed nearly 4,000 leases Tommy John, UNTUCKit, Warby social media followers with over • We have three new international totaling more than 14 million Parker and many others. 1.5 billion impressions. development projects under square feet in 2018! • Identifi ed over 130 new and • Increased the number of construction: Mexico (opening unique brands as part of our “Today at Apple” social/digital summer 2019), Spain (opening • Continue to devote signifi cant new business program, which campaigns to promote local fall 2019) and the United eff orts to add dining and resulted in over 230 new deals programming at Apple stores in Kingdom (opening spring 2020). entertainment concepts to our in 2018. Simon destinations. Our investment in these three properties. More than 60 new

VI SIMON PROPERTY GROUP, INC. • Expanded a partnership with impressions and drove selection of gift card choices • Grew the Simon Insider Disney Junior for quarterly 1.8 million shopper visits. and the lowest handling fees in loyalty program members by events and co-branded Play • Launched a new “Family at the sector. nearly 30% at participating Zones at select centers. Simon” platform showcasing centers and members spent • Amplified the “Touch, Try, Buy” family-oriented programming, INNOVATION approximately 20% more than an average shopper. marketing campaign to TV, shopping, dining, and • We complement investments video, social media and outdoor entertainment at local centers in our physical product • Grew our industry-leading advertising. This campaign across digital, on-center and with investments in technical Premium Outlet loyalty is an innovative and creative social media. innovations focused on membership program by approach to extolling the improving the shopping 12% and launched a new virtues of shopping in real life SIMON BRAND VENTURES experience and driving VIP Rewards Days driving for key products such as denim, significant incremental sales for • Provided brands and retailers shopper traffic. cosmetics and luxury items. participating retailers. with unique opportunities to • In the process of building a • Extended the “What’s New engage shoppers through a new consumer-facing digital • Developed a new concept Now” program to 113 centers— variety of media and activation platform (our fifth platform) called “Dwell,” an elevated including center-specific opportunities tailored to their in anticipation of a launch in customer lounge situated in content featuring the latest new specific needs, supported 2019. The new platform will common areas with a range of deals, brands, merchandise and by an unrivaled team of local, extend and deepen our online modern amenities, which will programming. The program is regional and national sales engagement with shoppers and debut later this year. curated and showcased through representatives committed to drive incremental traffic and • Enhanced product and brand our digital assets, giving our delivering turnkey, results-driven sales to participating retailers search capabilities across all shoppers a convenient way of solutions to our clients. and brands. local center websites to give learning what’s new at their • Continued to lead our industry • Created the Simon Quickeats shoppers increased visibility favorite center. by a significant margin, program, offering consumers into the merchandise available • Produced a programmatic outpacing the out-of-home the convenience of ordering at their favorite center. digital campaign targeting advertising market and our food from their mobile devices tourists at various stages in their industry as a whole, and and skipping the line with pick- SIMON VENTURES journey resulting in more than positively impacting bottom- up at the counter or having food • Simon Ventures is focused on 283 million impressions, over line results. delivered to them in the center. growth stage investments in 700,000 website visits and a • Leveraged Simon’s digital media • Expanded the industry’s largest companies that are operating 15% increase in traffic network to drive strong digital Happy Returns program to at the intersection of retail among viewers. media revenue growth of 68%. 16 new properties, generating and technology to drive • Implemented a successful • Grew revenues from our retail thousands of incremental forward innovative consumer campaign for Tax Free and Back- segment by 12%, with new and touchpoints with online experiences. to-School shopping, including emerging brands like Casper, shoppers. • These investments provide digital, social, video, streaming UNTUCKit, Tommy John, and • Significantly expanded our our Company with access to audio and TV content delivering others opening stores in our proprietary parking programs. exciting growth opportunities over 332 million impressions centers taking advantage of the Launched our Parking Made that have the potential to and driving more than 1.1 million Simon Media Network. Easy program in 45 centers. generate new sources of value visits to our centers. • Achieved a record level of gift Expanded our MyPark program creation. • Implemented a high-impact card sales in 2018, increasing and are testing a new Parking • Generate unique and campaign for Holiday shopping, sales by over $200 million, Express solution that gives proprietary deal flow that including digital, social, video, driven by a strong promotional shoppers a convenient upfront extends across critical retail and streaming audio and TV program, the industry’s widest parking option for quick pick- technology markets, from that delivered 627 million ups in the center. to Hong Kong.

2018 MARKETING CAMPAIGNS Our creative marketing strategy is driven by rich storytelling, audience segmentation, and data analysis to deliver compelling messages to our shoppers across multiple media channels to drive traffic and Back to School Video engagement. Premium Outlets TV Spot

Social Media Campaign Simon SAID Editorial Platform Holiday Video

2018 ANNUAL REPORT VII INVESTMENT HIGHLIGHTS

NEW DEVELOPMENT

DENVER PREMIUM OUTLETS Thornton (Denver), CO INTERNATIONAL INVESTMENT

QUERÉTARO PREMIUM OUTLETS Querétaro, Mexico MÁLAGA DESIGNER OUTLET Málaga, Spain

VIII SIMON PROPERTY GROUP, INC. TRANSFORMATION

KING OF PRUSSIA King of Prussia, PA WOODBURY COMMON PREMIUM OUTLETS Central Valley, NY

THE SHOPS AT RIVERSIDE Hackensack, NJ

PHIPPS PLAZA Atlanta, GA

2018 ANNUAL REPORT IX manage each of our assets as if it is our only asset. While it is good to reflect on our past, we must turn the page and continue to focus on the future. We are a team that sees things differently with a relentless focus on the future. The passion that fuels us is a burning desire to continue to get better every day. With a remarkable quarter- century of growth behind us, we look forward to the future from a strong position. We are better positioned than ever to continue to improve our Product and our Profitability, the two P’s! My Uncle Fred passed away recently and he will surely be missed. Brothers Mel, Herb and White Plains, NY Fred started the predecessor company, & Associates (“MSA”) nearly • Investment criteria skew heavily • Installed 560 electric vehicle • More than 30 million visitors 60 years ago. Uncle Fred ran mall towards a very select group of charging stations at over enjoyed dedicated play spaces leasing for MSA and engendered companies that simultaneously 110 properties across the U.S. within our shopping malls. loyalty from both his leasing demonstrate strong growth and • Please read our white paper • 100% of our properties have team and the retailers in those cash flow potential. on the advantages of physical received national “StormReady” early and crazy days of shopping • Portfolio company additions in retail compared to e-commerce designation by the National center development. The three 2018 included Bird, Foursquare, when it comes to sustainability. Weather Service. StormReady brothers from the “Bronx” have Bustle Digital Group, Verishop We have the clear advantage! indicates that our properties written quite the American story. and 9Count. You can read the white paper at can act as a safe space during We are proud to continue that sustainability.simon.com. severe weather conditions. tradition today. Simon is the first real estate SUSTAINABILITY I would like to thank Rick Sokolov company to have achieved such • Our sustainability vision is to COMMUNITY IMPACT for his 23 years of distinguished status across all its locations. be recognized as a leader in • Simon shopping centers are service to our Company. Rick has sustainable development and destinations for consumers • Our properties send 16% less been an invaluable partner and operations of retail properties to shop, dine, entertain, and waste to landfill than the played a critical role since joining in the U.S. have in-person connections broader industry. us in 1996 when we acquired • Achieved CDP’s “Leadership” and experiences with friends, • Simon’s $7 billion investment in DeBartolo Realty Corporation. recognition for top sustainability family, and community members redeveloping its properties over I am pleased that we will performance for a third in the ever-growing age of the last seven years continues to continue to benefit from Rick’s consecutive year and received digitalization. provide a significant jobs boost expertise as he continues to serve a Green Star rating, the highest • 5,000 Simon jobs representing to the local economies of the on our Board of Directors and as designation for sustainability $372 million in wages. communities it serves. our Vice Chairman. in the real estate industry • Over 300,000 retail jobs across • Graduated more than I would also like to thank our awarded by the Global Real Simon centers, representing 17,500 students from Simon Board of Directors for their Estate Sustainability Benchmark over $5.9 billion in annual wages. Youth Foundation’s (“SYF”) contributions in 2018. I cannot (GRESB), for five consecutive 35 academies across 15 states conclude this letter without • $5 billion in combined property years. in the U.S., while also awarding thanking all of my Simon tax payments from Simon • more than $17 million in colleagues for their continued Achieved a 37% reduction in and sales tax generated from scholarships over the last commitment, dedication electricity consumption across its tenants’ sales, delivering 20 years. Please read about the and support. the portfolio, which represents significant revenue for state good work SYF does at syf.org. 363 million Kwh (2003 to 2017). and local governments. Finally, I also thank you, our • Reduced greenhouse gas • 100% of Simon shopping malls shareholders, for your continued emissions by 45%, eliminating participate in local community CLOSING support. Your comments and 261,169 metric tons of carbon activities and, on average, each As I reflect on the last quarter- thoughts are always welcome dioxide equivalents—including Simon property is actively century, I can’t help but feel a and appreciated. scope 1, scope 2, and for scope engaged with four community sense of pride and joy in what we 3 only employee commuting organizations. have built and accomplished. It is and business travel (2003 an honor to lead such an amazing • to 2017). Over $7 million raised for charity team of talented people. As I said from more than 350 public in my first shareholder letter, and • Executed LED retrofit projects fundraising events held at Simon at over 178 properties. in many others since then, we properties, including Company are committed to our long-term contributions. strategy and we will continue to David Simon Chairman, CEO & President

X SIMON PROPERTY GROUP, INC. SUSTAINABILITY HIGHLIGHTS For Simon, sustainability is a business approach that enhances the communities in which we operate as well as long-term shareholder value by embracing opportunities, improving our bottom line and mitigating environmental and social risks. Our sustainability vision is to be recognized as a leader in sustainable development and operations of retail properties in the U.S. We defi ne and implement sustainability initiatives that consider all stages of our business. The four areas of our sustainability framework are outlined below:

SUSTAINABILITY FOCUS AREAS

Properties Customers Communities Employees Strive for effi ciency in Anticipate customers’ needs and Create meaningful social and Strive for high levels of employee operating our properties with enhance the shopping experience economic impact in the engagement by creating a culture innovative solutions that lower at Simon centers while assisting communities in which we operate that attracts and retains the operational costs and reduce our our tenants to be successful in and build strong communities industry’s best talent environmental footprint their business through development and engagement activities

KEY ACCOMPLISHMENTS We continuously monitor our performance and set ambitious targets for our sustainability initiatives. Key accomplishments include1:

• Achieved a 37% reduction in • Executed LED retrofi t projects • 100% of centers participate in • Engaged in sustainability electricity consumption across at over 178 properties across local community engagement thought leadership by the portfolio which represents the U.S. activities—353 fundraising conducting a lifecycle 363 million Kwh (2003–2017). events held across Simon assessment to measure impact • Installed 560 electric vehicle properties in 2017. of online versus brick-and- • Reduced GHG emissions by charging stations at over mortar shopping behaviors. 45% across the portfolio which 110 properties across the U.S. • Awarded more than $17 million The results of the study represents 261,169 metric tons in scholarships to nearly • Completed feasibility review for concluded that online shopping of CO e—including scope 1, 5,000 students and helped more 2 on-site solar and energy battery can have a 7% larger negative scope 2, and for scope 3 only than 17,500 students graduate storage projects across the environmental impact than employee commuting and from high school through portfolio. Pilot on-site solar and in-mall shopping. business travel (2003–2017). Simon Youth Foundation’s energy battery storage projects 35 academies across 15 states initiated across select sites in in the U.S. the U.S.

INTERNATIONAL RECOGNITION Simon has consistently been recognized for its sustainability disclosure and performance by third parties:

• Achieved CDP’s “Leadership” recognition for sustainability CDP has built the most comprehensive collection of self-reported environmental data performance for a third consecutive year (2016–2018). in the world. Their network of investors and purchasers, representing over $100 trillion, along with policy makers around the globe, use this data and insights to make better- • Received a Green Star rating, the highest designation for informed decisions. sustainability in the real estate industry awarded by the Global Real GRESB is an industry-driven organization committed to assessing the ESG performance Estate Sustainability Benchmark (GRESB), for fi ve consecutive years of real assets globally, including real estate portfolios. More than 75 institutional (2014–2018). investors use GRESB data to engage with investment managers to enhance and protect shareholder value. GRESB investor members represent over USD 18 trillion in • Recognized as StormReady by the National Weather Service. institutional capital. Read more about progress on our sustainability goals in the 1 All environmental indicators include properties within Simon’s Company’s 2018 Sustainability Report at sustainability.simon.com operational control boundary and exclude organic growth.

2018 ANNUAL REPORT XI BOARD OF DIRECTORS, EXECUTIVE OFFICERS AND MEMBERS OF SENIOR MANAGEMENT

BOARD OF DIRECTORS EXECUTIVE OFFICERS PREMIUM OUTLETS Glyn F. Aeppel David Simon Stephen Yalof President and Chief Executive Officer Chairman of the Board, Chief Executive Officer Chief Executive Officer of Glencove Capital and President Larry Weinstein Larry C. Glasscock Steven E. Fivel Executive Vice President — Leasing Former Chairman and CEO of Anthem, Inc. General Counsel and Secretary Peter Baxter Karen N. Horn, Ph.D. John Rulli Executive Vice President — Luxury Leasing Senior Managing Director President of Malls and of Brock Capital Group Chief Administrative Officer Danielle De Vita Executive Vice President — Real Estate Allan Hubbard Brian J. McDade Co-Founder, Chairman and Executive Vice President, Chief Financial Leslie Swanson Partner of E&A Companies Officer and Treasurer Executive Vice President — Property Management Reuben S. Leibowitz Alexander L. W. Snyder Managing Member of JEN Partners Assistant General Counsel and Assistant Secretary CORPORATE Gary M. Rodkin Former Chief Executive Officer Richard S. Sokolov of ConAgra Foods, Inc. MALLS Director and Vice Chairman Stefan M. Selig Michael E. McCarty Stanley Shashoua Founder of BridgePark Advisors LLC President of Simon Development Chief Investment Officer

David Simon Eric Sadi Mikael Thygesen Chairman of the Board, Chief Executive Officer Chief Operating Officer — Leasing Chief Marketing Officer and President — and President of Simon Property Group, Inc. Simon Brand Ventures Michael J. Nevins Herbert Simon Chief Operating Officer — Malls Business Andres Lugo Chairman Emeritus of the Board of Executive Vice President— Simon Property Group, Inc. Vicki Hanor Construction Group Senior Executive Vice President and Managing Daniel C. Smith, Ph.D. Director — Luxury Leasing Mark J. Silvestri President and Chief Executive Officer of Executive Vice President—Corporate the Indiana University Foundation and Jonathan Murphy Real Estate and Chief Operating Officer— Clare W. Barker Professor of Marketing, Executive Vice President — Leasing and Development Indiana University Kelley School of Business Strategic Projects Chidi Achara J. Albert Smith, Jr. Sharon Polonia Senior Vice President and Chairman, Chase Indiana and Executive Vice President — Leasing Chief Creative Officer Managing Director, JPMorgan Private Bank Michael Romstad Steven K. Broadwater Richard S. Sokolov Executive Vice President — Property Senior Vice President­—Financial Director and Vice Chairman of Management Reporting and Operations Simon Property Group, Inc. Charles Davis Natalie Hwang Marta R. Stewart Senior Vice President — Development Senior Managing Director—Simon Ventures Retired Executive Vice President and Chief Financial Officer of Norfolk Southern John Phipps J. Michelle Mahaffey Corporation Senior Vice President — Development Senior Vice President and Chief Human Resources Officer Sundesh N. Shah Audit Committee Senior Vice President—Specialty Development Adam J. Reuille J. Albert Smith, Jr., Chairman, Senior Vice President and Larry C. Glasscock, Reuben S. Leibowitz, Kathleen Shields Chief Accounting Officer Stefan M. Selig, Marta R. Stewart Senior Vice President — Development David Schacht Compensation Committee Senior Vice President and Reuben S. Leibowitz, Chairman, THE MILLS Chief Information Officer Allan Hubbard, Daniel C. Smith, Ph.D., J. Albert Smith, Jr., Stefan M. Selig Gary Duncan Thomas Ward President Senior Vice President — Investor Relations Governance and Nominating Committee Rhonda D. Bandy Brian J. Warnock Karen N. Horn, Ph.D., Chairman, Senior Vice President—Leasing Senior Vice President — Acquisitions and Glyn F. Aeppel, Larry C. Glasscock, Financial Analysis Allan Hubbard, Gary M. Rodkin Jay E. Buckey Senior Vice President—Leasing

William Hopper Senior Vice President—Specialty Development

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 Policies With Respect To Certain Other Activities

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The following factors, among others, could cause our actual results to differ materially from those expressed or

implied in forward - looking statements made in this Annual Report on Form 10 - K and presented elsewhere by our management from time to time. These factors may have a material adverse effect on our business, financial condition, liquidity, results of operations, funds from operations, or FFO, and prospects, which we refer to herein as a material adverse effect on us or as materially and adversely affecting us, and you should carefully consider them. Additional risks and uncertainties not presently known to us or which are currently not believed to be material may also affect our actual results. We may update these factors in our future periodic reports.

5LVNV5HODWLQJWR5HWDLO2SHUDWLRQV Conditions that adversely affect the general retail environment could materially and adversely affect us.

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Some of our properties depend on anchor stores or other large nationally recognized tenants to attract shoppers and we could be materially and adversely affected by the loss of one or more of these anchors or tenants.

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We face potential adverse effects from tenant bankruptcies.

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We face a wide range of competition that could affect our ability to operate profitably.

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Excess space at our properties could materially and adversely affect us.

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 We may not be able to lease newly developed properties and renew leases and relet space at existing properties.

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Our international activities may subject us to different or greater risk from those associated with our domestic operations.

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Real estate investments are relatively illiquid.

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5LVNV5HODWLQJWR'HEWDQGWKH)LQDQFLDO0DUNHWV We have a substantial debt burden that could affect our future operations.

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 Disruption in the capital and credit markets may adversely affect our ability to access external financings for our growth and ongoing debt service requirements.

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Adverse changes in our credit rating could affect our borrowing capacity and borrowing terms.

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An increase in interest rates would increase our interest costs on variable rate debt and could adversely impact our ability to refinance existing debt on attractive terms, or at all; our hedging interest rate protection arrangements may not effectively limit our interest rate risk.

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Simon and certain subsidiaries of the Operating Partnership have elected to be taxed as REITs in the United States and certain international operations also are structured to be taxed in a manner similar to the REIT structure. The failure to maintain Simon’s or these subsidiaries’ qualifications as REITs or changes in local tax laws or regulations in certain of our international operations could result in adverse tax consequences.

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Complying with REIT requirements might cause us to forego otherwise attractive acquisition opportunities or liquidate otherwise attractive investments.

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Partnership tax audit rules could have a material adverse effect on us.

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We have limited control with respect to some properties that are partially owned or managed by third parties, which may adversely affect our ability to sell or refinance them.

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The Operating Partnership guarantees debt or otherwise provides support for a number of joint venture properties.

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5LVNV5HODWLQJWR(QYLURQPHQWDO0DWWHUV As owners of real estate, we can face liabilities for environmental contamination.

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Our efforts to identify environmental liabilities may not be successful.

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We face risks associated with climate change.

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2WKHU)DFWRUV$IIHFWLQJ2XU%XVLQHVV Some of our potential losses may not be covered by insurance.

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 We face risks associated with security breaches through cyber - attacks, cyber intrusions or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems.

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Our success depends, in part, on our ability to attract and retain talented employees, and the loss of any one of our key personnel could adversely impact our business.

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Provisions in Simon’s charter and by - laws and in the Operating Partnership’s partnership agreement could prevent a change of control.

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 Simon Property Group, Inc. Simon Property Group, L.P. Property Table U.S. Properties

FOOTNOTES:

(1) This property is managed by a third party.

(2) Our direct and indirect interests in some of the properties held as joint venture interests are subject to preferences on distributions in favor of other partners or us.

(3) The date listed is the expiration date of the last renewal option available to the operating entity under the ground lease. In a majority of the ground leases, we have a right to purchase the lessor’s interest under an option, right of first refusal or other provision. Unless otherwise indicated, each ground lease listed in this column covers at least 50% of its respective property.

(4) Joint venture properties accounted for under the equity method.

(5) Malls - Executed leases for all company-owned GLA in mall stores, excluding majors and anchors. Premium Outlets and The Mills - Executed leases for all company-owned GLA (or total center GLA).

(6) Indicates box, anchor, major or project currently under development/construction or has announced plans for development.

(7) Indicates ground lease covers less than 50% of the acreage of this property.

(8) Tenant has multiple locations at this center.

(9) Indicates ground lease covers outparcel only.

(10) Tenant has an existing store at this center but will move to a new location. 35 (11) We receive substantially all the economic benefit of the property due to a preference or advance.

(12) We own a mortgage note that encumbers that entitles us to 100% of the economics of this property.

(13) Indicates anchor has announced its intent to close this location.

(14) Indicates box, anchor, major or project currently under development/construction by a third party.

(15) Owned by a third party.

(16) Includes multi-family tenant on-site.

(17) GLA includes office space. Centers with more than 75,000 square feet of office space are listed below:

Auburn Mall - 85,619 sq. ft. Circle Centre - 130,635 sq. ft. - 893,670 sq. ft. Domain, The - 156,240 sq. ft. Fashion Centre at Pentagon City, The - 169,089 sq. ft. Oxford - 137,791 sq. ft. Shops at Clearfork, The - 142,684 sq. ft.

United States Lease Expirations

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Deferred Costs and Other Assets

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Deferred Lease Costs

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CORPORATE HEADQUARTERS ANNUAL REPORT ON FORM 10-K Simon Property Group, Inc. A copy of the Simon Property Group, Inc. Annual Report on Form 10-K 225 West Washington Street filed with the United States Securities and Exchange Commission can Indianapolis, IN 46204 be obtained free of charge by: 317-636-1600 • Contacting the Investor Relations Department at 800-461-3439 or [email protected]; or TRANSFER AGENT AND REGISTRAR • Accessing the Financials page of the website at investors.simon.com Computershare, our transfer agent, maintains the records for our registered shareholders and can assist you with a variety of shareholder services including address changes, certificate ANNUAL MEETING replacement/transfer and dividends. The Annual Meeting of Shareholders of Simon Property Group, Inc. will be held on Wednesday, May 8, 2019, at 225 W. Washington St., Shareholder correspondence should be mailed to: Indianapolis, IN, at 8:30 a.m., local time. P.O. Box 505000 Louisville, KY 40233-5000 COMPANY SECURITIES Overnight correspondence should be mailed to: Simon Property Group, Inc. common stock and one issue of preferred Computershare stock are traded on the (“NYSE”) under the 462 South 4th Street following symbols: Suite 1600 Louisville, KY 40202 Common Stock SPG 8.375% Series J Cumulative Preferred SPGPrJ 800-454-9768 or 781-575-2723 (Outside the U.S.) The quarterly price range on the NYSE for the common stock and the 800-952-9245 (TDD for Hearing Impaired) dividends declared per share for each quarter in the last two fiscal www.computershare.com/investor years are shown below.

DECLARED DIRECT STOCK PURCHASE/DIVIDEND 2017 HIGH LOW CLOSE DIVIDENDS REINVESTMENT PROGRAM Computershare administers a direct stock purchase and dividend First Quarter $ 188.10 $ 163.55 $ 172.03 $ 1.75 reinvestment plan that allows interested investors to purchase Simon Property Group stock directly, rather than through a broker, Second Quarter 176.17 150.15 161.76 1.75 and become a registered shareholder. The program offers many Third Quarter 167.12 152.51 161.01 1.80 features including dividend reinvestment. For detailed information, Fourth Quarter 172.35 153.71 171.74 1.85 contact Computershare at 800-454-9768 or www.computershare.com/investor. DECLARED 2018 HIGH LOW CLOSE DIVIDENDS

WEBSITE First Quarter $ 173.02 $ 147.28 $ 154.35 $ 1.95 Information such as financial results, corporate announcements, Second Quarter 173.26 145.78 170.19 1.95 dividend news and corporate governance is available on Simon’s Third Quarter 186.03 166.95 176.75 2.00 website: investors.simon.com Fourth Quarter 191.49 159.77 1 6 7. 9 9 2.00

SHAREHOLDER INQUIRIES 800-461-3439 ©2019 Simon Property Group, Inc. [email protected] Design: Ideas On Purpose, New York, www.ideasonpurpose.com Printing: Digital Color Concepts Photography (page II): Michel Labelle INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Ernst & Young LLP Indianapolis, IN

All paper in this report is certified to the Forest Stewardship Council® (FSC®) standards. TWENTY-FIVE YEARS OF EXCEPTIONAL ACHIEVEMENTS

+2,752% TOTAL SHAREHOLDER RETURN SIMON PROPERTY GROUP, INC. +10% REVENUE CAGR

+8% 2018 ANNUAL REPORT FFO PER SHARE CAGR +6% DIVIDENDS PER SHARE CAGR $90B+ TOTAL MARKET CAPITALIZATION INCREASE