REITs

Retail slump won't hurt these REITs: Pro

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Is the shopping mall dead?

While retail's slump has some investors concerned about the future of malls, one investment pro thinks fears of shopping centers' demise is premature — at least for the good-quality ones.

"There are malls which are in trouble. There are shopping centers, there are offices, and this has been going on for hundreds of years," said Marc Halle, head of global real estate securities at Prudential Real Estate Investors and senior portfolio manager of the Prudential Global Real Estate Fund.

"Good properties, well located, well managed, will continue to do well."

Those "A-quality" malls are seeing a lot of shoppers and a lot of sales, Halle told CNBC's "Power Lunch" Thursday.

This week both Kohl's and Macy's posted their steepest quarterly same-store sales declines since the recession, prompting fears about the survival of malls.

1 in 3 American malls are doomed: Retail consultant Jan Kniffen
Pedestrians pass in front of Macy's flagship store in Herald's Square, New York.
Retailers ringing the recession alarm
A shopper at a Kohl's store in Jersey City, NJ.
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People walk past Macy's flagship store in Manhattan, New York.
Macy's results reminiscent of financial crisis

Retail analyst Jan Kniffen believes Macy's results are a sign of the country's oversupply of retail space. He's predicting 400 of America's 1,100 enclosed malls will fail in the coming years.

"They're going to go out of business. It's just a question of how fast and at what rate that happens. We're seeing malls go out of business every year now," he told CNBC's "Squawk Box" Thursday.

Halle said that while retail sales slowing from anchor stores like Macy's is not positive, the anchors are not the powerhouse driving shoppers as they have in the past. Today, consumers are moving from apparel to experiences and Real Estate Investment Trusts (REITs) are well-positioned for the change because they are redeveloping their formats to cater to shopping trends, he said.

He specifically likes General Growth Properties, Federated Realty Investment Trust, Simon and Taubman — all of which are in his fund.

CNBC's Jackie O'Sullivan, Krystina Gustafson and Tom DiChristopher contributed to this report.

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