What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2023-02-27 compared with 2022-02-22 · 78 added, 112 removed, 152 unchanged (56% of the section changed)

2 unchanged sentences

and subsidiaries, which we refer to as the Company, is one of the largest owners and operators of outlet centers in the United States and Canada.

We are a fully-integrated, self-administered and self-managed REIT, which focuses exclusively on developing, acquiring, owning, operating and managing outlet shopping centers.

As of December 31, 2021, our consolidated portfolio consisted of 30 outlet centers, with a total gross leasable area of approximately 11.5 million square feet, which were 95% occupied and contained over 2,200 stores representing approximately 500 store brands.

We are a fully-integrated, self-administered and self-managed REIT, which focuses on developing, acquiring, owning, operating and managing outlet shopping centers.

As of December 31, 2022, our consolidated portfolio consisted of 29 outlet centers, with a total gross leasable area of approximately 11.4 million square feet, which were 97% occupied and contained over 2,200 stores representing approximately 600 store brands, as well as one center under construction.

We also had partial ownership interests in 6 unconsolidated outlet centers totaling approximately 2.1 million square feet, including 2 outlet centers in Canada.

Our portfolio also includes one managed center totaling approximately 500,000 square feet.

Each of our outlet centers, except one joint venture property, features the Tanger brand name.

Our outlet centers and other assets are held by, and all of our operations are conducted by, Tanger Properties Limited Partnership and subsidiaries, which we refer to as the Operating Partnership.

14 unchanged sentences

Recent Developments

Organizational Changes

In June 2021 and upon recommendation of the Board's Nominating and Corporate Governance Committee, the board of directors voted to expand the number of positions on the Company's board of directors from eight to nine and elected Sandeep Mathrani as a director to fill the vacancy for a term ending at the Company’s 2022 Annual Meeting of Shareholders.

Effective December 1, 2021, Leslie Swanson was named Executive Vice President – Chief Operating Officer.

She joined the Company in October 2020 as Executive Vice President of Operations, bringing over 25 years of experience in shopping center operations, management and marketing and a reputation as a proven team leader, revenue generator, and thought leader.

New Development

In May 2022, we broke ground on our 37th center in Nashville, Tennessee.

The center, which will be approximately 290,000 square feet, is expected to open in the third quarter of 2023 at an estimated total cost of $142.0 million to $150.0 million with a projected stabilized yield of 7.0% to 7.5%.

Through December 31, 2022, we had incurred costs of $36.0 million associated with this development.

Property Management

In August 2022, we announced a strategic partnership with Clarion Partners at Palm Beach Outlets in West Palm Beach, Florida.

We assumed marketing, leasing and property management responsibilities at the 457,000 square foot property, which has been rebranded as Tanger Outlets Palm Beach.

Financing Transactions

Equity Offerings

In February 2021, we implemented an at-the-market share offering program (“ATM Offering”), whereby we may offer and sell our common shares, $0.01 par value per share (“Common Shares”), having an aggregate gross sales price of up to $250.0 million.

During 2021, under this program, the Company sold 10.0 million shares at a weighted average price of $18.97 per share, generating net proceeds of $187.1 million and leaving a remaining authorization of $60.1 million.

The proceeds were used primarily to reduce indebtedness as described in the sections immediately below.

Unsecured Term Loan

In March 2021 and June 2021, we paid down a total of $50.0 million of borrowings under our $350.0 million unsecured term loan with cash on hand, reducing the outstanding balance to $300.0 million as of December 31, 2021.

Unsecured Lines of Credit Extension

In July 2021, we amended our unsecured lines of credit and extended the maturity date from October 2021 to July 2025, which may be extended by an additional year by exercising two six-month extension options.

The amendment eliminated the LIBOR floor, which was previously 0.25%, and entitles us to a one basis point annual reduction in the interest rate if we meet certain sustainability thresholds.

Other pricing terms remained the same.

The lines provide for borrowings of up to $520.0 million, including a $20.0 million liquidity line and a $500.0 million syndicated line.

A 0.25% facility fee is due annually on the entire committed amount of each facility.

In certain circumstances, total line capacity may be increased to $1.2 billion through an accordion feature in the syndicated line.

Redemption of the 2023 and 2024 Senior Notes and public offering of aggregate $400.0 Million Unsecured Senior Notes due 2031

In April 2021, we completed a partial redemption of $150.0 million aggregate principal amount of our $250.0 million 3.875% senior notes due December 2023, for $163.0 million in cash, which included a make-whole premium of $13.0 million and the write-off of approximately $1.0 million of debt discount and debt origination costs.

The make-whole premium and the write-off of debt discount and debt origination costs was recorded as a loss on early extinguishment of debt within the consolidated statements of operations.

Subsequent to this redemption, $100.0 million aggregate principal amount of the notes remained outstanding, until the redemption in August 2021, described below.

In August 2021, we completed a public offering of $400.0 million in senior notes due 2031.

The notes were priced at 98.552% of the principal amount to yield 2.917% to maturity.

The notes pay interest semi-annually at a rate of 2.750% per annum and mature on September 1, 2031.

The aggregate net proceeds from the offering, after deducting the underwriting discount and offering expenses, were approximately $390.7 million.

We used the net proceeds from the sale of the notes to redeem all remaining 3.875% senior notes due 2023, $100.0 million in aggregate principal amount outstanding, and all 3.750% senior notes due 2024, $250.0 million in aggregate principal outstanding.

The redemptions occurred in September 2021 and included a make-whole premium of $31.9 million and the write-off of approximately $1.9 million of debt discount and debt origination costs.

The make-whole premium and the write-off of debt discount and debt origination costs was recorded as a loss on early extinguishment of debt within the consolidated statement of operations.

The remaining proceeds were used for general corporate purposes.

In October 2022, we amended and restated our unsecured term loan.

The outstanding balance was increased from $300.0 million to $325.0 million and the maturity was extended from April 2024 to January 2027 plus a one-year extension option.

The interest rate changed from LIBOR + 1.25% to Adjusted Secured Overnight Financing Rate (SOFR) + 1.20% based on our current credit rating at closing.

The amendment also incorporates a sustainability metric, reducing the applicable grid-based interest rate spread by one basis point annually, subject to meeting certain thresholds.

Unsecured Lines of Credit

In October 2022, we amended our unsecured lines of credit to change the interest rate index from LIBOR to Adjusted SOFR.

All other terms remained unchanged.

Southaven, MS mortgage

In October 2021, the joint venture that owns the Southaven, MS outlet center exercised its option to extend the maturity of the Southaven, MS mortgage to April 2023 and paid down the principal balance by $11.3 million to $40.1 million.

The interest rate remains LIBOR + 1.80%.

The outlet center is consolidated for financial reporting purposes and we funded the entire $11.3 million.

In December 2021, due to a decrease in the estimated hold period and declining operating results we recorded in our consolidated statement of operations a $7.0 million impairment charge, which equaled the excess of the carrying value of our Mashantucket (Foxwoods), Connecticut outlet center over its estimated fair value.

Property Sales

In January 2021, we sold a non-core outlet center in Jeffersonville, Ohio for net proceeds of $8.1 million, which resulted in no gain or loss on sale of assets.

In October 2022, the Southaven, Mississippi joint venture amended and restated its secured term loan, increasing the outstanding balance to $51.7 million from $40.1 million, extending the maturity from April 2023 to October 2026 plus a one-year extension option, with an interest rate of Adjusted SOFR plus 2.00%.

Unconsolidated Real Estate Joint Ventures Financing Transactions

RioCan Canada

In March 2021, the RioCan joint venture closed on the sale of its outlet center in Saint-Sauveur, for net proceeds of approximately $9.4 million.

Our share of the proceeds was approximately $4.7 million.

As a result of this transaction, we recorded a loss on the sale of $3.7 million.

This includes a $3.6 million charge related to the foreign currency effect of the sale recorded in other income (expense), which had been previously recorded in other comprehensive income.

Galveston/Houston, Texas

In February 2021, the Galveston/Houston joint venture amended its mortgage loan to extend the maturity to July 2023, which required a reduction in principal balance from $80.0 million to $64.5 million.

The amendment also changed the interest rate from LIBOR + 1.65% to LIBOR + 1.85%.

Each partner made capital contributions of $7.0 million to fund the reduction in principal balance.

Columbus, Ohio

In September 2022, the joint venture completed the refinance of its existing $71.0 million LIBOR + 1.85% which had a maturity date of November 2022.

The refinanced mortgage remained $71.0 million but became a non-recourse loan with a maturity date in October 2032 and a fixed interest rate of 6.25%.

Property Sales

In December 2022, we sold our Blowing Rock, North Carolina center for $13.0 million, which resulted in a gain on sale of assets of $3.2 million.

Organizational Changes

In November 2022, Michael Bilerman became the Company’s Executive Vice President, Chief Financial Officer and Chief Investment Officer.

The Outlet Concept

Outlet centers generally consist of stores operated by manufacturers and brand name retailers that sell primarily first quality, branded products, some of which are made specifically for the outlet distribution channel, to consumers at significant discounts from regular retail prices charged by department stores and specialty stores.

Outlet centers offer advantages to manufacturers and brand name retailers as they are often able to charge customers lower prices for brand name and designer products by eliminating the third party retailer.

Outlet centers also typically have lower operating costs than other retailing formats, enhancing their profit potential.

Outlet centers enable retailers to optimize the size of production runs while continuing to maintain control of their distribution channels.

Outlet centers also enable manufacturers and brand name retailers to establish a direct relationship with their customers and maintain brand integrity through control of product placement and pricing.

We believe that outlet centers present an attractive opportunity for capital investment as many retailers view the outlet concept as a profitable distribution channel.

However, due to present economic conditions, the availability of multiple retail channels, and the potential for increased competition from other outlet center developers, new developments or expansions may not provide an initial return on investment as high as has been historically achieved and there may not be as many opportunities to develop or expand.

Outlet centers generally consist of stores operated by brands and retailers that sell primarily branded products, some of which are made specifically for the outlet distribution channel, to consumers at significant discounts from regular retail prices charged by department stores, specialty stores and their own full price channels.

Outlet centers offer advantages to brands and retailers as they are often able to charge customers lower prices for branded and designer products by eliminating the third party retailer or through operating efficiencies.

Stores and outlet centers also typically have lower operating costs than other retailing formats, enhancing their profit potential.

Outlet centers enable retailers to optimize the size of production runs and their inventory positions while continuing to maintain control of their distribution channels.

Outlet centers also enable brands and retailers to establish a direct relationship with their customers and maintain brand integrity through control of product placement and pricing.

Our Outlet Centers

Each of our outlet centers, except one joint venture property, carries the Tanger brand name.

Each of our outlet centers, except one joint venture property, features the Tanger brand name.

Additionally, we leverage the Tanger brand and platform to manage a center in Palm Beach, Florida owned by an institutional investor.

We believe that our tenants and consumers recognize the Tanger brand as one that provides outlet shopping centers where consumers can trust the brand, value and experience.

As one of the original participants in this industry, we have established long-standing relationships with many of our tenants that we believe are critical in developing and operating successful outlet centers.

Our consolidated outlet centers range in size from 104,009 to 739,148 square feet and are typically located at least 10 miles from major department stores and manufacturer-owned, full-price retail stores.

Historically, manufacturers prefer these locations so that they do not compete directly with their major customers and their own stores.

Many of our outlet centers are located near tourist destinations to attract tourists who consider shopping to be a recreational activity.

As one of the original participants in this industry and through key additions to our executive, leasing, operating and center teams, we have established long-standing relationships with many of our tenants that we believe are critical in operating, managing, developing, and acquiring successful outlet and retail centers.

Our consolidated outlet centers are typically located in a variety of geographical areas, including high frequency tourist destinations and suburbs of vibrant and fast-growing markets.

Additionally, our centers are often situated in close proximity to interstate highways that provide accessibility and visibility to potential customers.

We have a diverse tenant base throughout our consolidated portfolio, comprised of approximately 500 manufacturers, brand name and discount apparel and home retailers such as American Eagle Outfitters, Banana Republic Factory, Calvin Klein, Coach, Cole Haan Outlet, Gap Outlet, Kate Spade New York, Lululemon, Michael Kors, Nike Factory Store, Restoration Hardware, Saks Off 5th, The North Face, T.J.

Maxx, Tory Burch, Under Armour, Vineyard Vines, West Elm Outlet, Williams-Sonoma Outlet and many more.

We have a diverse tenant base throughout our consolidated portfolio, comprised of approximately 600 designers, brands, specialty retailers and select multi-brand retailers such as Nike, Coach, Gap Outlet, Ralph Lauren, Michael Kors, Kate Spade, American Eagle, Under Armour, Banana Republic, Ann Taylor, Columbia, The North Face, Adidas, Levis, H&M, Old Navy, Bath and Body Works, Vineyard Vines, J Crew, Tory Burch, Hollister, Lululemon, Allbirds, Summersalt, Ulta, Hey Dude, Huk, Crocs, Restoration Hardware, Pottery Barn, West Elm, Williams-Sonoma, and many more.

No single tenant, including all of its store concepts, accounted for 10% or more of our combined base and percentage rental revenues during 2022, 2021 or 2020.

21 unchanged sentences

Business Strategy

Our Company has been built on a firm foundation of strong and enduring business relationships coupled with conservative business practices.

We partner with many of the world's best known and most respected retailers and manufacturers.

By fostering and maintaining strong tenant relationships with these successful, high volume companies, we have been able to solidify our position as a leader in the outlet industry for well over a quarter century.

The confidence and trust that we have developed with our retail partners from the very beginning has allowed us to forge the impressive retail alliances that we enjoy today with our brand name retailers and manufacturers.

Our seasoned team of real estate professionals utilize the knowledge and experience that we have gained to give us a competitive advantage in the outlet business.

Our Company has been built on a firm foundation of strong and enduring business relationships coupled with disciplined business practices.

We partner with many of the world's best known and most respected brands and retailers.

By fostering and maintaining strong relationships with these successful, high volume companies, we have been able to solidify our position as a leader in the outlet industry for over thirty years.

Our seasoned team of professionals with diverse sets of expertise utilize the knowledge and experience that we have gained to give us a competitive advantage in the outlet business.

Growth Strategy

Our goal is to build shareholder value through a comprehensive, conservative plan for sustained, long-term growth.

We focus our efforts on increasing net operating income at our existing outlet centers, renovating and expanding selected outlet centers and reaching new markets through ground-up developments or acquisitions of existing outlet centers.

We expect new development to continue to be important to the growth of our portfolio in the long-term.

However, the number of new development opportunities may be limited or completed at a slower pace than our historical experience given the current disruption in the retail environment caused in part by Internet competition and numerous store closings as a result of bankruptcy filings or brand wide restructuring of certain retailers.

Future outlet centers may be wholly-owned by us or developed through joint venture arrangements.

Our goal is to build shareholder value through a comprehensive, disciplined plan for sustained, long-term growth.

We focus our efforts on increasing net operating income at our existing outlet centers, renovating and optimizing selected outlet centers and pursuing disciplined external growth in our current markets and potential new markets through selective ground-up development or the acquisition of retail real estate.

Future retail real estate assets may be wholly-owned by us, owned through joint ventures or partnership arrangements, or through management agreements.

Increasing net operating income at existing outlet centers

Our leasing team focuses on the marketing of available space to maintain our standard for high occupancy levels.

Our leasing team focuses on optimizing the use of our real estate to attract and engage best in class brands and retailers with a focus on maximizing consumer demand and rent.

The majority of our leases are negotiated to provide for inflation-based contractual rent increases or periodic fixed contractual rent increases and percentage rents.

We have historically been able to renew many leases at higher base rents per square-foot and replace underperforming tenants with new or existing tenants in our portfolio.

Given the current retail environment as discussed above, we may choose to execute leases with new tenants or renew certain tenants to enhance our tenant mix or maintain a high portfolio occupancy rate.

In addition, we are focused on generating non-store revenues (other revenues) and actively managing property operating expenses as a means of growing net operating income.

We have historically been able to renew many leases at higher base rents per square-foot and replace underperforming tenants with new or existing brands in our portfolio.

Given the current retail environment, we may choose to execute leases with new tenants or renew certain tenants to enhance our tenant mix or maintain a high portfolio occupancy rate.

In addition, we are focused on generating non-store revenues (other revenues), through marketing partnerships, media and ROI driven sustainability initiatives and actively managing property operating expenses and marketing expenses as a means of growing net operating income.

Developing new outlet centers

We believe that there continue to be opportunities to introduce the Tanger brand in untapped or under-served markets across the United States and Canada in the long-term.

We believe our 41 years of outlet industry experience, extensive development expertise and strong retail relationships give us a distinct competitive advantage.

In order to identify new markets across North America, we follow a general set of guidelines when evaluating opportunities for the development of new outlet centers.

This typically includes seeking locations within markets that have at least one million people residing within a 30 to 40 mile radius with an average household income of at least $65,000 per year, frontage on a major interstate or roadway that has excellent visibility and a traffic count of at least 55,000 cars per day.

Leading tourist, vacation and resort markets that receive at least five million visitors annually are also closely evaluated.

Although our current goal is to target sites that are large enough to support outlet centers with approximately 60 to 90 stores totaling at least 250,000 to 350,000 square feet, we maintain the flexibility to vary our minimum requirements based on the unique characteristics of a site, tenant demand and our prospects for future growth and success.

We believe our expertise in the outlet industry, extensive development expertise and strong retail relationships give us a distinct competitive advantage.

In order to help ensure the viability of proceeding with a project, we gauge the interest of our retail partners first.

1 unchanged sentence

however, we may choose to proceed with construction with less than 60% of the space pre-leased under certain circumstances.

Construction of a new outlet center has typically taken us nine to twelve months from groundbreaking to grand opening of the outlet center.

Construction of a new outlet center has typically taken us twelve to eighteen from groundbreaking to grand opening of the outlet center.

Expanding and renovating existing outlet centers

Keeping our outlet shopping centers vibrant and growing is a key part of our formula for success.

In order to maintain our reputation as the premiere outlet shopping destination in the markets that we serve, we have an ongoing program of renovations and expansions taking place at our outlet centers.

Keeping our centers vibrant and growing is a key part of our formula for success.

In order to maintain our reputation as the premiere shopping destination in the markets that we serve, we have an ongoing program of renovations and expansions taking place at our outlet centers.

Construction for expansion and renovation to existing properties typically takes less time, usually between six to nine months depending on the scope of the project.

Acquiring outlet centers

Acquiring retail real estate

We may selectively choose to acquire individual properties or portfolios of properties that meet our strategic investment criteria.

We believe that our extensive experience in the outlet center business, access to capital markets, familiarity with real estate markets and our management experience will allow us to evaluate and execute our acquisition strategy successfully over time.

Through our tenant relationships, our leasing professionals have the ability to implement a re-merchandising strategy when needed to increase occupancy rates and value.

We believe that our managerial skills, marketing expertise and overall outlet industry experience will also allow us to add long-term value and viability to these outlet centers.

We believe that our extensive experience in the retail business, access to capital markets, familiarity with real estate markets and our management experience will allow us to evaluate and execute our acquisition strategy successfully over time.

Through our tenant relationships, our teams have the ability to implement a re-merchandising strategy when needed to increase occupancy rates, optimize rents and maximize value.

We believe that our brand operating platform and operational expertise and overall retail industry experience will also allow us to add long-term value and viability to these assets.

Operating Strategy

1 unchanged sentence

Through targeted marketing and operational efficiencies, we strive to improve sales and profitability of our tenants and our outlet centers as a whole.

Achieving higher base and percentage rents and generating additional income from temporary leasing, vending and other non-store sources also remains an important focus and goal.

Our long-standing retailer relationships and our focus on identifying emerging retailers allow us the ability to provide our shoppers with a collection of the world's most popular outlet stores.

Tanger customers shop and save on their favorite brand name merchandise including men's, women's and children's ready-to-wear, lifestyle apparel, footwear, jewelry and accessories, tableware, housewares, luggage and home goods.

Achieving higher base and percentage rents and generating additional income from temporary leasing, media and other non-store sources also remains an important focus and goal.

Our long-standing retailer relationships and our focus on identifying emerging retailers allow us the ability to provide our shoppers with a collection of the world's most popular retailers.

Tanger customers shop and save on their favorite branded merchandise including men's, women's and children's ready-to-wear, digitally native brands, lifestyle apparel, footwear, jewelry and accessories, tableware, housewares, luggage and home goods.

In addition, we are focused on adding non-traditional uses to our tenant mix, including experiential and food and beverage tenants.

1 unchanged sentence

They also work to assist our tenants through re-sizing and re-location of retail space within each of our outlet centers for maximum sales of each retail unit across our portfolio.

Our marketing plans deliver compelling, well-crafted messages and enticing promotions and events to targeted audiences.

Our plans are based on a basic measure of success - increase sales and traffic for our retail partners and we will create successful outlet centers.

Utilizing a strategic mix of traditional (print, radio, television, direct mail and public relations) and digital (our consumer website, Internet advertising, social networks, and mobile applications) channels, we consistently reinforce the Tanger brand.

Our marketing efforts are also designed to build loyalty with current Tanger shoppers and create awareness with potential customers.

The majority of consumer-marketing expenses incurred by us are reimbursable by our tenants.

Our comprehensive marketing plans are designed to drive sales and traffic in partnership with our retail partners.

We leverage data to enable a return on investment-oriented performance marketing approach for efficient customer acquisition.

Investments to transform our digital channels allow us to engage existing customers with timely and personalized communications.

Our loyalty strategies are two pronged – earning increased wallet share with vested customers and optimizing an incremental ancillary revenue stream.

Our efforts to engage broad audiences through seasonal events and our digital channels enable our ability to monetize our customer audience for media and sponsorship opportunities with retail partners and nationally trusted brands.

Capital Strategy

We believe we achieve a strong and flexible financial position by attempting to:

(1) maintain a conservative leverage position relative to our portfolio when pursuing new development, expansion and acquisition opportunities, (2) extend and sequence debt maturities, (3) manage our interest rate risk through a proper mix of fixed and variable rate debt, (4) maintain access to liquidity by using our lines of credit in a conservative manner and (5) preserve internally generated sources of capital by strategically divesting of our non-core assets and maintaining a conservative distribution payout ratio.

We manage our capital structure to reflect a long-term investment approach and utilize multiple sources of capital to meet our requirements, including without limitation issuances of equity under our ATM program.

(1) maintain a conservative leverage position relative to our portfolio when pursuing new development, expansion and acquisition opportunities, (2) extend and sequence debt maturities, (3) manage our interest rate risk through an appropriate mix of fixed and variable rate debt and interest rate hedging strategies, (4) maintain access to liquidity by using our lines of credit in a conservative manner and (5) preserve internally generated sources of capital by maintaining a conservative distribution payout ratio.

We manage our capital structure to reflect a long-term investment approach and utilize multiple sources of capital to meet our requirements, including without limitation, cash on hand, retained free cash flow and debt and equity issuances.

We intend to retain the ability to raise additional capital, including public debt or equity, to pursue attractive investment opportunities that may arise and to otherwise act in a manner that we believe to be in the best interests of our shareholders and unitholders.

1 unchanged sentence

To generate capital to reinvest into other attractive investment opportunities, we may also consider the use of additional operational and developmental joint ventures, the sale or lease of outparcels on our existing properties and the sale of certain properties that do not meet our long-term investment criteria.

Based on cash provided by operations, existing lines of credit, ongoing relationships with certain financial institutions and our ability to issue debt or equity subject to market conditions, we believe that we have access to the necessary financing to fund our planned capital expenditures during 2022.

Based on cash provided by operations, cash and cash equivalents, our short-term investments, existing lines of credit, ongoing relationships with certain financial institutions and our ability to issue debt or equity subject to market conditions, we believe that we have access to the necessary financing to fund our planned capital expenditures during 2023.

We anticipate that adequate cash will be available to fund our operating and administrative expenses, regular debt service obligations, and the payment of dividends in accordance with REIT requirements in both the short and long-term.

2 unchanged sentences

We believe our current balance sheet position is financially sound;

however, due to the uncertainty and unpredictability of the capital and credit markets, we can give no assurance that affordable access to capital will exist between now and when our next significant debt maturity, which is our unsecured term loan due April 2024.

As a result, our current primary focus is to continually strengthen our capital and liquidity position by controlling and reducing construction and overhead costs, generating positive cash flows from operations to cover our distributions and reducing outstanding debt.

We carefully consider the degree of existing and planned competition in a proposed area before deciding to develop, acquire or expand a new outlet center.

Our outlet centers compete for customers primarily with outlet centers built and operated by different developers, traditional shopping malls, full- and off-price retailers and e-commerce retailers.

We believe that the majority of our customers visit outlet centers because they are intent on buying name-brand products at discounted prices.

Traditional full-and off-price retailers and e-commerce retailers are often unable to provide such a variety and depth of name-brand products at attractive prices.

Because our revenues are ultimately linked to our tenants' success, we are affected by the same competitive factors, such as consumer spending habits and online shopping, as our tenants.

Tenants of outlet centers are generally adverse to direct competition with major brick and mortar retailers and their own specialty stores.

For this reason, our outlet centers generally compete only to a limited extent with traditional malls in or near metropolitan areas as our centers are typically located at least 10 miles from major department stores and manufacturer-owned, full-price retail stores.

In recent years, some of our tenants have been adversely impacted by changes in consumer spending habits and the convenience of online shopping.

We believe that the majority of our customers visit outlet centers because they are intent on shopping brands at discounted prices.

Traditional full-and off-price retailers and e-commerce retailers are often unable to provide such a variety and depth of selection and sizes at attractive prices.

Because our revenues are ultimately linked to our tenants' success, we are affected by the same competitive factors, such as consumer spending habits, as our tenants.

We compete with institutional pension funds, private equity investors, other REITs, individual owners of outlet centers, specialty stores and others who are engaged in the acquisition, development or ownership of outlet centers and stores.

In addition, the number of entities competing to acquire or develop outlet centers has increased and may continue to increase in the future, which could increase demand for these outlet centers and the prices we must pay to acquire or develop them.

Nevertheless, we believe the high barriers to entry in the outlet industry, including the need for extensive marketing programs to drive traffic to the centers and relationships with premier manufacturers and brand name retailers, will continue to limit the number of new outlet centers developed each year.

Nevertheless, we believe the high barriers to entry in the outlet industry, including the need for extensive marketing programs to drive traffic to the centers and relationships with premier brands and retailers, will continue to limit the number of new outlet centers developed each year.

Financial Information

2 unchanged sentences

Corporate and Regional Headquarters

We rent space in an office building in Greensboro, North Carolina where our corporate headquarters is located.

We rent space in an office building in Greensboro, North Carolina where our corporate headquarters is located, as well as a regional office in New York, New York.

As of December 31, 2022, we maintain offices and employ on-site management at 32 consolidated and unconsolidated outlet centers.

20 unchanged sentences

At that date, we also employed 262 part-time employees at various locations.

Our success is highly dependent on part-time employees and the institutional knowledge that comes with high retention rates.

Our part-time workforce is 46% of our 573-person workforce and 28% of them have been with us for 5 years or longer.

In 2022, 57% of our full-time workforce has been with us for five years or longer.

4 unchanged sentences

As of December 31, 2022, team members who identify as females made up 82% of field employees, 24% of our executive leadership team, and 77% of our total 603-person workforce.

Ethnic minorities made up 26% of our total workforce in 2021.

The Company's Board gender composition consisted of 22% members who identify as female and 22% of members with ethnic diversity.

Racial minorities made up 26% of our total workforce in 2022.

The Company's Board gender composition consisted of 22% members who identify as female and 22% of members with racial diversity.

We focus on developing strategies that enhance an environment where high performance, training and expression of our core competencies are rewarded and publicly recognized.

13 unchanged sentences

In 2021 and 2022, we disclosed to Global Real Estate Sustainability Benchmark (GRESB) and CDP (formerly, the Carbon Disclosure Project).

We are also currently assessing our climate-related governance and strategy to report in line with the Task Force on Climate-related Financial Disclosures (TCFD) and aim to become a signatory to the United Nations Global Compact (UNGC).

We are also currently assessing our climate-related governance and strategy to report in line with the Task Force on Climate-related Financial Disclosures (TCFD) and we became a signatory to the United Nations Global Compact (UNGC) in 2022.

ESG governance

3 unchanged sentences

Our full Board of Directors provides oversight for the ESG function, and, as appropriate, certain matters are considered by a specific committee of the Board of Directors.

Material ESG issues – priorities and impacts

Priority ESG issues

Our ESG materiality process drives strategy on environmental, social, economic and governance topics.

18 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business