What changed in this filing

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Item 2. Properties

2023-02-27 compared with 2022-02-22 · 29 added, 26 removed, 245 unchanged (18% of the section changed)

As of December 31, 2021, our consolidated portfolio consisted of 30 outlet centers totaling 11.5 million square feet located in 18 states.

As of December 31, 2022, our consolidated portfolio consisted of 29 outlet centers totaling 11.4 million square feet located in 18 states and one center under construction.

We own interests in six other outlet centers totaling approximately 2.1 million square feet through unconsolidated joint ventures, including two 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 consolidated outlet centers range in size from 181,687 to 739,148 square feet.

15 unchanged sentences

Rehoboth Beach, DE 2.7 2044 2064

(1) Lease may be renewed at our option for additional terms of twenty years each.

Generally, our leases with our outlet center tenants typically have an initial term that ranges from 5 to 10 years and provide for the payment of fixed monthly rent in advance.

1 unchanged sentence

In addition, the rental payments are customarily subject to upward adjustments based upon tenant sales volume.

A component of most leases includes a pro-rata share or escalating fixed contributions by the tenant for property operating expenses, including common area maintenance, real estate taxes, insurance and advertising and promotion, thereby reducing exposure to increases in costs and operating expenses resulting from inflation.

The following table summarizes certain information with respect to our consolidated outlet centers as of December 31, 2022:

12 unchanged sentences

Tennessee 1 449,968 4

North Carolina 2 422,895 3

Arizona 1 410,753 3

3 unchanged sentences

Louisiana 1 321,066 3

North Carolina 1 319,762 3

Connecticut 1 311,229 3

41 unchanged sentences

Hilton Head I, South Carolina 100 181,687 99

Blowing Rock, North Carolina 100 104,009 100

Total 11,353,454 97

19 unchanged sentences

See Note 5 to the consolidated financial statements for further details of our joint ventures' debt obligations.

Location Square Feet

Managed Properties

Palm Beach, Florida 457,326

Base Rents and Occupancy Rates

1 unchanged sentence

2022 2021 2020 (2)

2019 2018 2017

Occupancy 97 % 95 % 92 % 97 % 97 %

1 unchanged sentence

(1) Average annual base rent per square foot is calculated based on base rental revenues recognized during the year on a straight-line basis including non-cash adjustments to base rent required by United States Generally Accepted Accounting Principles ("GAAP") and the effects of inducements and rent concessions divided by the weighted average square feet of the consolidated portfolio.

Average annual base rent excludes common area maintenance and reimbursements.

(2) The decline in the average annual base rent per square foot in 2020 compared to previous years reflects the decline in occupancy from 97% in 2019 to 92% in 2020 and rent modifications primarily due to a number of tenants filing bankruptcy during 2020.

67 unchanged sentences

Given the fewer than twelve months of sales reported by our tenants for 2020, an average tenant occupancy cost is not provided for this period.

As of December 31, 2021, our occupancy cost was reduced to 8.1%.

The decrease in occupancy costs compared to the previous 5 years is primarily due to the strong rebound in sales in the 2021 period, but has also been impacted favorably by the significant amount of stores permanently closing in our portfolio during 2019 and 2020, as a result of bankruptcies and brand-wide restructurings, which generally had occupancy costs higher than the portfolio average.

As of December 31, 2022, our occupancy cost ratio increased to 8.6%.

The increase from 2021 relates to higher operating costs.

The following table sets forth certain information for our consolidated outlet centers with respect to our 25 largest tenants based on total annualized base rent as of December 31, 2022 (1) :

4 unchanged sentences

Gap, Banana Republic, Old Navy 81 867,805 7.0 % 5.3 %

SPARC Group Aéropostale, Brooks Brothers, Eddie Bauer, Forever 21, Lucky Brands, Nautica 88 530,635 4.3 % 4.0 %

Premium Apparel, LLC;

1 unchanged sentence

LOFT, Ann Taylor, Lane Bryant, Talbots 76 406,570 3.3 % 3.9 %

SPARC Group Aéropostale, Brooks Brothers, Eddie Bauer, Forever 21, Lucky Brands, Nautica 75 461,640 4.0 % 4.2 %

Tommy Hilfiger, Van Heusen, Calvin Klein 40 298,803 2.6 % 3.6 %

Tapestry, Inc.

Coach, Kate Spade, Stuart Weitzman 47 223,813 2.0 % 3.4 %

Under Armour, Inc.

Under Armour, Under Armour Kids 28 246,787 2.0 % 3.0 %

Tommy Hilfiger, Calvin Klein 38 286,103 2.3 % 3.0 %

Tapestry, Inc.

Coach, Kate Spade, Stuart Weitzman 48 226,912 1.8 % 3.0 %

American Eagle Outfitters, Inc.

2 unchanged sentences

Columbia Sportswear Company Columbia Sportswear 22 176,697 1.4 % 2.3 %

Adidas AG Adidas, Reebok 32 206,425 1.8 % 2.3 %

Capri Holdings Limited Michael Kors, Michael Kors Men’s 27 137,486 1.1 % 2.0 %

Carter’s, Inc.

Carters, OshKosh B Gosh 40 177,045 1.5 % 2.3 %

Carter's, OshKosh B'gosh 39 173,705 1.4 % 2.0 %

Signet Jewelers Limited Kay Jewelers, Zales, Jared Vault 49 108,873 0.9 % 1.9 %

Skechers USA, Inc.

Skechers 28 154,913 1.2 % 1.8 %

Hanesbrands Inc.

Hanesbrands, Maidenform, Champion 33 162,479 1.3 % 1.8 %

Ralph Lauren Corporation Polo Ralph Lauren, Polo Children, Polo Ralph Lauren Big & Tall 32 350,331 3.1 % 2.1 %

Rack Room Shoes, Inc.

Rack Room Shoes 25 187,848 1.5 % 1.8 %

Skechers USA, Inc.

Skechers 28 154,913 1.4 % 2.0 %

Signet Jewelers Limited Kay Jewelers, Zales, Jared Vault 45 103,260 0.9 % 2.0 %

Ralph Lauren Corporation Polo Ralph Lauren, Polo Children, Polo Ralph Lauren Big & Tall 30 338,181 2.7 % 1.7 %

Corporation The North Face, Vans, Timberland, Dickies, Work Authority 27 143,207 1.2 % 1.7 %

Luxottica Group S.p.A.

Sunglass Hut, Oakley, Lenscrafters 53 79,829 0.6 % 1.6 %

Express Factory 24 168,000 1.4 % 1.6 %

Chico’s, FAS Inc.

Chicos, White House/Black Market, Soma Intimates 37 107,287 0.9 % 1.8 %

H & M Hennes & Mauritz LP.

H&M 18 385,321 3.1 % 1.6 %

Luxottica Group S.p.A.

Sunglass Hut, Oakley, Lenscrafters 52 76,178 0.7 % 1.7 %

Adidas AG Adidas 19 141,430 1.1 % 1.6 %

Chico’s, FAS Inc.

Chicos, White House/Black Market, Soma Intimates 34 98,901 0.8 % 1.5 %

Levi Strauss & Co.

Levi's 27 111,510 0.9 % 1.5 %

Famous Footwear, Allen Edmonds 27 152,156 1.3 % 1.6 %

Rue 21 Rue 21 19 114,559 1.0 % 1.4 %

Famous Footwear 25 148,489 1.2 % 1.4 %

Rue 21, LLC Rue 21 19 114,559 0.9 % 1.3 %

Total of Top 25 tenants 930 6,042,494 48.6 % 56.5 %

14 unchanged sentences

(1) Average annual base rent per square foot is calculated based on base rental revenues recognized during the year on a straight-line basis including non-cash adjustments to base rent required by GAAP and the effects of inducements and rent concessions divided by the weighted average square feet of the Deer Park Outlet Center.

The increase in the average annual base rent per square foot in 2021 compared to 2020 reflects the increase in occupancy from 89% in 2020 to 95% in 2021 and temporary rent modifications primarily due to a number of tenants filing bankruptcy during 2020.

The increase in the average annual base rent per square foot in 2022 compared to 2021 reflects the increase in occupancy from 95% in 2021 to 100% in 2022 and temporary rent modifications primarily due to a number of tenants filing for bankruptcy during 2020.

Depreciation on the outlet centers is computed on the straight-line basis over the estimated useful lives of the assets.

We generally use estimated lives up to 33 years for buildings, 15 years for land improvements and 7 years for equipment.

We generally use estimated lives of up to 33 years for buildings, 15 years for land improvements and 7 years for equipment.

Expenditures for ordinary repairs and maintenance are charged to operations as incurred while significant renovations and improvements, including tenant finishing allowances, which improve and/or extend the useful life of the asset are capitalized and depreciated over their estimated useful life.

21 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 2. Properties