“No one is building new regional malls, and roughly 90 percent of our go-forward NOI comes from Class A assets and the best retailers of the world.”

So said Jackson Hsieh, president and CEO of Macerich, early on during the mall-focused real estate investment trust’s second-quarter earnings call Tuesday afternoon. (He was referring to projected net operating income.) 

The observation goes a long way toward explaining the REIT’s continued turnaround. Macerich owns 40 million square feet of real estate, most of it within 37 malls in markets in California, the Pacific Northwest, and the Washington-to-New York corridor. 

Hsieh took over the company in early 2024 when it was struggling to maintain tenancies at some of the malls, a few of which Macerich has since sold. Meanwhile, development of fresh shopping centers in these prime markets has all but dried up, leaving Macerich and only a handful of competitors such as Simon Property Group at the top of a tighter market amid ongoing demand from Gen Zers and other shoppers. 

Macerich reported leased occupancy of 94 percent in the second quarter, up from 92 percent during the same period in 2025. The REIT signed around 1.3 million square feet of new and renewal leases. That led to what Macerich described as 1 percent annual increase in the second quarter of new-store square footage. The REIT expects approximately $124 million in total gross revenue from these new-store leases.

Leasing deals included with tenants such as Aerie, Offline by Aerie, Old Navy, Eataly, Zara and Sephora. It also included tenants in the increasingly popular experiential retail niche such as Level 99 and Golf Galaxy.

The REIT’s revenue from leases was $233.4 million in the second quarter, up slightly from $232.7 in the second quarter of 2025. Total revenue was $249.7 million, about the same as last year. Funds from operations, a key profitability measure for REITs, hit an adjusted $100.4 million, up from $88.7 million during the same period in 2025. 

Macerich did report a $27.1 million net loss for the quarter, but it wasn’t as big as last year’s, when the loss totaled nearly $41 million. The company cited gains on asset sales during the past three months for the narrowing of the loss gap. Those sales included Macerich’s minority stake in the West Acres mall in Fargo, N.D., for $1.4 million.

The company was also in an acquisitive mood last quarter. That included the splashy $272 million purchase in early May of Maryland’s Annapolis Mall, plus an adjacent vacant Sears parcel. 

Go-forward net operating income in the second quarter — a projection of NOI based on vacancy, occupancy and other factors, but excluding money from lease terminations — was up 3.8 percent annually. 

Macerich said it has around $1.2 billion in liquidity, including $900 million in its revolving line of credit. That, coupled with the stronger leasing figures and the go-forward NOI, makes it confident it can continue to pare losses and grow the company behind what it now calls its Path Forward 3.0 plan (an update from the original Path Forward plan Hsieh instituted in 2024).  

“We have a tremendous advantage having an integrated operating platform,” Hsieh said on the call. “We’ve got great national tenant relationships, and we got the money. And we don’t need mortgage debt, and we’ve got speed and certainty.”

Tom Acitelli can be reached at tacitelli@commercialobserver.com.