Macerich's Strategic Turnaround: Why Now Is the Time to Reassess MAC as a High-Yield Value Play

In the shadow of a once-ailing retail sector, Macerich (MAC) has emerged as a case study in disciplined capital management and strategic reinvention. The company's Path Forward Plan, launched amid the sector's upheaval, has delivered measurable progress in deleveraging, accretive acquisitions, and resilient leasing performance. With the retail landscape stabilizing and consumer spending shifting toward experiential and destination retail, Macerich's recalibrated business model positions it as a compelling high-yield value play for investors seeking long-term growth.

Capital-Efficient Deleveraging: A Foundation for Stability

Macerich's balance sheet has undergone a transformation. As of Q2 2025, its net debt-to-EBITDA ratio stands at 7.9x, down nearly a full turn from the plan's inception. This reduction is no accident but a result of disciplined asset sales and liquidity management. The company has already sold $1.2–1.5 billion of its $2 billion disposition target, including high-profile assets like South Park ($11 million) and Atlas Park ($72 million). These sales have not only reduced leverage but also freed up capital for strategic reinvestment.

What's more, Macerich's liquidity position is robust. It holds $915 million in total liquidity, including $650 million in revolving credit capacity, providing flexibility to navigate near-term challenges. The company's debt maturity profile is also favorable, with only a $200 million loan maturing in November 2025. This manageable schedule, combined with its $160 million term loan for the Crabtree Mall acquisition, underscores a capital structure that prioritizes stability without sacrificing growth.

Accretive Acquisitions: Targeting Growth in High-Potential Markets

The acquisition of Crabtree Mall in Raleigh-Durham exemplifies Macerich's strategic focus on quality over quantity. Priced at $290 million for a 1.3 million-square-foot, Class A asset, the deal aligns with the company's goal of acquiring market-dominant properties in high-growth regions. At 74% occupancy, Crabtree Mall has significant upside potential, with management targeting 90% occupancy by 2028. The property's proximity to Apple's North Carolina campus and its existing tenant base—anchored by best-in-class retailers—position it to capitalize on rising consumer demand for experiential retail.

This acquisition is not an outlier but part of a broader strategy to refine Macerich's portfolio. By focusing on assets with strong demographic tailwinds and repositioning potential, the company is creating a foundation for sustainable NOI and FFO growth. The $160 million term loan used to fund the deal is a calculated risk, given the asset's projected returns and Macerich's liquidity cushion.

Resilient Leasing Momentum: A Sector on the Mend

Macerich's leasing performance in Q2 2025 was nothing short of impressive. The company signed 1.7 million square feet of new and renewal leases, bringing year-to-date leasing to 4.3 million square feet—a 75% increase compared to 2024. This momentum is driven by a mix of tenant demand and proactive repositioning. For instance, over 50% of the space vacated by Forever 21 has already been committed to new tenants like Urban Planet and Dick's House of Sport, while another 30% is in the letter of intent stage.

The “Sign Not Open” (SNOW) pipeline further validates this trend. At $87 million as of Q2 2025, the pipeline is on track to exceed $100 million by year-end, reflecting strong tenant interest in Macerich's reimagined properties. The leasing speedometer—a metric tracking progress toward annual goals—shows 65% of targets achieved by mid-year, with confidence in hitting 70% by year-end. These metrics suggest that Macerich's portfolio is not just surviving but thriving in a stabilizing retail environment.

Why Now Is the Time to Reassess MAC

Macerich's strategic turnaround is entering a critical phase. With leverage reduction well underway, a high-conviction acquisition in Crabtree Mall, and leasing momentum accelerating, the company is poised to deliver value to shareholders. The retail sector, long plagued by e-commerce disruption, is showing signs of stabilization as consumers return to physical experiences. Macerich's focus on premium assets, operational efficiency, and tenant diversity positions it to outperform peers.

For investors, the current valuation offers an attractive entry point. At a forward P/FFO of approximately 10x, Macerich trades at a discount to its historical average and peers, reflecting lingering skepticism about the retail sector. However, the company's progress on deleveraging, combined with its accretive growth strategy, suggests this discount may not be justified.

Conclusion: A High-Yield Value Play with Long-Term Potential

Macerich's Path Forward Plan has transformed it from a struggling mall operator into a disciplined, growth-oriented REIT. The company's capital-efficient deleveraging, strategic acquisitions, and resilient leasing performance create a compelling case for investors seeking exposure to a stabilizing retail sector. While risks remain—such as macroeconomic headwinds and tenant-specific challenges—the balance sheet strength and operational momentum provide a margin of safety.

For those willing to look beyond short-term volatility, Macerich represents a high-yield value play with the potential to deliver both income and capital appreciation. As the retail landscape continues to evolve, Macerich's strategic reinvention may prove to be one of the most underrated opportunities in the sector.