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Item 1. Financial Statements

2023-04-28 compared with 2022-11-04 · 137 added, 257 removed, 483 unchanged (45% of the section changed)

3 unchanged sentences

(In thousands, except unit data, unaudited)

September 30, 2022 December 31, 2021

March 31, 2023 December 31, 2022

Rental property:

6 unchanged sentences

Cash and cash equivalents 202,629 212,011

Short-term investments 32,946 52,450

Investments in unconsolidated joint ventures 73,368 73,809

15 unchanged sentences

Partners’ Equity:

General partner, 1,100,000 units outstanding at September 30, 2022 and 1,100,000 units at December 31, 2021, respectively

Limited partners, 4,761,559 and 4,761,559 Class A common units, and 103,246,428 and 102,984,734 Class B common units outstanding at September 30, 2022 and December 31, 2021, respectively

General partner, 1,100,000 units outstanding at March 31, 2023 and 1,100,000 units at December 31, 2022, respectively

Limited partners, 4,737,982 and 4,737,982 Class A common units, and 104,216,253 and 103,397,920 Class B common units outstanding at March 31, 2023 and December 31, 2022, respectively

516,800 521,168

8 unchanged sentences

(In thousands, except per unit data, unaudited)

Three months ended September 30, Nine months ended September 30,

2022 2021 2022 2021

Three months ended March 31,

Rental revenues $ 103,582 $ 104,609

8 unchanged sentences

Interest expense ( 12,343 ) ( 11,634 )

Loss on early extinguishment of debt — ( 33,821 ) — ( 47,860 )

Other income (expense) 2,800 183

Total other income (expense) ( 9,543 ) ( 11,451 )

Income (loss) before equity in earnings of unconsolidated joint ventures 22,290 ( 13,332 ) 59,831 ( 10,891 )

Income before equity in earnings of unconsolidated joint ventures 22,925 18,949

Equity in earnings of unconsolidated joint ventures 1,935 2,513

Net income (loss) 24,345 ( 11,071 ) 66,626 ( 4,133 )

Net income 24,860 21,462

Noncontrolling interests in consolidated partnerships ( 248 ) —

Net income (loss) available to partners 24,345 ( 11,071 ) 66,626 ( 4,133 )

Net income (loss) available to limited partners 24,102 ( 10,959 ) 65,958 ( 4,095 )

Net income available to partners 24,612 21,462

Net income available to limited partners 24,366 17,150

Net income (loss) available to general partner $ 246 $ 4,312

Basic earnings per common unit:

Net income (loss) $ 0.22 $ ( 0.11 ) $ 0.61 $ ( 0.05 )

Net income $ 0.22 $ 0.20

Diluted earnings per common unit:

Net income (loss) $ 0.22 $ ( 0.11 ) $ 0.60 $ ( 0.05 )

Net income $ 0.22 $ 0.19

The accompanying notes are an integral part of these consolidated financial statements.

2 unchanged sentences

(In thousands, unaudited)

Three months ended September 30, Nine months ended September 30,

2022 2021 2022 2021

Net income (loss) $ 24,345 $ ( 11,071 ) $ 66,626 $ ( 4,133 )

Three months ended March 31,

Net income $ 24,860 $ 21,462

Other comprehensive income (loss):

2 unchanged sentences

Other comprehensive income (loss) ( 3,264 ) 8,900

Comprehensive income (loss) 22,428 ( 13,105 ) 73,433 2,072

Comprehensive income 21,596 30,362

Comprehensive income attributable to noncontrolling interests in consolidated partnerships ( 248 ) —

Comprehensive income (loss) attributable to the Operating Partnership $ 22,428 $ ( 13,105 ) $ 73,433 $ 2,072

Comprehensive income attributable to the Operating Partnership $ 21,348 $ 30,362

The accompanying notes are an integral part of these consolidated financial statements.

3 unchanged sentences

General partner Limited partners Accumulated other comprehensive loss Total partners’ equity Noncontrolling interests in consolidated partnerships Total equity

Balance, June 30, 2021 $ 4,909 $ 538,376 $ ( 19,800 ) $ 523,485 $ — $ 523,485

Net loss ( 112 ) ( 10,959 ) — ( 11,071 ) — ( 11,071 )

Other comprehensive loss — — ( 2,034 ) ( 2,034 ) — ( 2,034 )

Compensation under Incentive Award Plan — 3,012 — 3,012 — 3,012

Issuance of 17,240 common units upon exercise of options

— 99 — 99 — 99

Issuance of 331,682 common units

— 6,093 — 6,093 — 6,093

Withholding of 8,756 common units for employee income taxes

— ( 150 ) — ( 150 ) — ( 150 )

Grant of 23,488 restricted common share awards by the Company

Common distributions ($ 0.3600 per unit) (1)

( 396 ) ( 38,878 ) — ( 39,274 ) — ( 39,274 )

Balance, September 30, 2021 $ 4,401 $ 497,593 $ ( 21,834 ) $ 480,160 $ — $ 480,160

General partner Limited partners Accumulated other comprehensive loss Total partners’ equity Noncontrolling interests in consolidated partnerships Total equity

Balance, December 31, 2021 $ 4,539 $ 514,023 $ ( 18,773 ) $ 499,789 $ — $ 499,789

Net loss ( 38 ) ( 4,095 ) — ( 4,133 ) — ( 4,133 )

Net income 4,312 17,150 — 21,462 — 21,462

Other comprehensive income — — 8,900 8,900 — 8,900

2 unchanged sentences

— 10 — 10 — 10

Issuance of 10,009,263 common units

1,874 185,095 — 186,969 — 186,969

Withholding of 129,971 common units for employee income taxes

3 unchanged sentences

( 201 ) ( 19,983 ) — ( 20,184 ) — ( 20,184 )

Balance, September 30, 2021 $ 4,401 $ 497,593 $ ( 21,834 ) $ 480,160 $ — $ 480,160

(1) Includes a $ 0.1775 cash distribution per common unit declared and paid during the third quarter of 2021 and a cash distribution declared in September 2021 payable in November 2021 of $ 0.1825 per common unit.

(2) Includes a $ 0.5325 cash distribution per common unit declared and paid during the first nine months of 2021 and a cash distribution declared in September 2021 payable in November 2021 of $ 0.1825 per common unit.

Balance, March 31, 2022 $ 8,650 $ 511,800 $ ( 9,873 ) $ 510,577 $ — $ 510,577

TANGER PROPERTIES LIMITED PARTNERSHIP AND SUBSIDIARIES

2 unchanged sentences

General partner Limited partners Accumulated other comprehensive loss Total partners’ equity Noncontrolling interests in consolidated partnerships Total equity

Balance, June 30, 2022 $ 4,543 $ 518,081 $ ( 10,049 ) $ 512,575 $ — $ 512,575

Net income 243 24,102 — 24,345 — 24,345

Other comprehensive loss — — ( 1,917 ) ( 1,917 ) — ( 1,917 )

Compensation under Incentive Award Plan — 3,057 — 3,057 — 3,057

Issuance of 5,000 common units upon exercise of options

— 28 — 28 — 28

Withholding of 37,792 common units for employee income taxes

— ( 538 ) — ( 538 ) — ( 538 )

Common distributions ($ 0.20 per unit)

( 220 ) ( 21,671 ) — ( 21,891 ) — ( 21,891 )

Balance, September 30, 2022 $ 4,566 $ 523,059 $ ( 11,966 ) $ 515,659 $ — $ 515,659

General partner Limited partners Accumulated other comprehensive loss Total partners’ equity Noncontrolling interests in consolidated partnerships Total equity

Balance, December 31, 2022 $ 4,516 $ 521,168 $ ( 11,750 ) $ 513,934 $ — $ 513,934

Net income 246 24,366 — 24,612 248 $ 24,860

Other comprehensive income — — 6,807 6,807 — 6,807

Other comprehensive loss — — ( 3,264 ) ( 3,264 ) — ( 3,264 )

Compensation under Incentive Award Plan — 2,323 — 2,323 — 2,323

Issuance of 7,700 common units upon exercise of options

— 43 — 43 — 43

Issuance of 2,600 common shares upon exercise of options

Withholding of 300,639 common units for employee income taxes

3 unchanged sentences

( 242 ) ( 25,423 ) — ( 25,665 ) ( 248 ) ( 25,913 )

Balance, September 30, 2022 $ 4,566 $ 523,059 $ ( 11,966 ) $ 515,659 $ — $ 515,659

Balance, March 31, 2023 $ 4,520 $ 516,800 $ ( 15,014 ) $ 506,306 $ — $ 506,306

The accompanying notes are an integral part of these consolidated financial statements.

2 unchanged sentences

(In thousands, unaudited)

Nine months ended September 30,

Three months ended March 31,

OPERATING ACTIVITIES

Net income (loss) $ 66,626 $ ( 4,133 )

Net income $ 24,860 $ 21,462

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

1 unchanged sentence

Amortization of deferred financing costs 808 759

Loss on early extinguishment of debt — 47,860

Equity in earnings of unconsolidated joint ventures ( 1,935 ) ( 2,513 )

4 unchanged sentences

Distributions of cumulative earnings from unconsolidated joint ventures 2,007 2,474

Other non-cash ( 2,418 ) 3,638

Changes in other assets and liabilities:

4 unchanged sentences

Additions to rental property ( 25,940 ) ( 5,867 )

Additions to investments in unconsolidated joint ventures — ( 7,000 )

Net proceeds from sale of real estate assets — 8,129

Net proceeds on sale of non-real estate assets 14,610 —

Proceeds from short-term investments 19,504 —

Additions to non-real estate assets ( 370 ) ( 1,924 )

7 unchanged sentences

Repayments of notes, mortgages and loans ( 1,160 ) ( 1,080 )

Payment of make-whole premium related to early extinguishment of debt — ( 44,872 )

Employee income taxes paid related to shares withheld upon vesting of equity awards ( 5,649 ) ( 2,146 )

1 unchanged sentence

Proceeds from exercise of options 15 10

Proceeds from the Company’s common share offering — 186,969

Payment for other financing activities ( 287 ) ( 287 )

Distributions to noncontrolling interests in other consolidated partnerships ( 248 ) —

Net cash used in financing activities ( 33,011 ) ( 23,914 )

Effect of foreign currency on cash and cash equivalents 7 ( 8 )

Net increase in cash and cash equivalents 19,398 58,063

Net increase (decrease) in cash and cash equivalents ( 9,382 ) ( 8,574 )

Cash and cash equivalents, beginning of period 212,011 161,152

8 unchanged sentences

We are a fully-integrated, self-administered and self-managed real estate investment trust (“REIT”) which, through our controlling interest in the Operating Partnership, focuses exclusively on developing, acquiring, owning, operating and managing outlet shopping centers.

As of September 30, 2022, we owned and operated 30 consolidated outlet centers, with a total gross leasable area of approximately 11.5 million square feet, one managed center and 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.

As of March 31, 2023, we owned and operated 29 consolidated 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 six unconsolidated outlet centers totaling approximately 2.1 million square feet, 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 outlet centers and other assets are held by, and all of our operations are conducted by, Tanger Properties Limited Partnership and subsidiaries.

6 unchanged sentences

Tanger LP Trust holds a limited partnership interest.

As of September 30, 2022, the Company and its wholly-owned subsidiaries owned 104,346,428 units of the Operating Partnership and other limited partners (the “Non-Company LPs”) collectively owned 4,761,559 Class A common limited partnership units.

As of March 31, 2023, the Company and its wholly-owned subsidiaries owned 105,316,253 units of the Operating Partnership and other limited partners (the “Non-Company LPs”) collectively owned 4,737,982 Class A common limited partnership units.

Each Class A common limited partnership unit held by the Non-Company LPs is exchangeable for one of the Company’s common shares, subject to certain limitations to preserve the Company’s REIT status.

30 unchanged sentences

Our estimate of the collectability of accrued rents and accounts receivable is based on the best information available to us at the time of preparing the financial statements.

Straight-line rent adjustments recorded as a receivable in prepaids and other assets on the consolidated balance sheets was approximately $ 51.8 million as of September 30, 2022.

Straight-line rent adjustments recorded as a receivable in prepaids and other assets on the consolidated balance sheets was approximately $ 50.3 million as of March 31, 2023.

Impairment of Long-Lived Assets

Rental property held and used by us is reviewed for impairment in the event that facts and circumstances indicate that the carrying amount of an asset may not be recoverable.

In such an event, we compare the estimated future undiscounted cash flows associated with the asset to the asset's carrying amount, and if less, recognize an impairment loss in an amount by which the carrying amount exceeds its fair value.

If economic and market conditions deteriorate beyond our current expectations, as a result of the ongoing COVID-19 pandemic (“COVID-19”) or other macroeconomic factors, or if our expected holding periods for assets change, subsequent tests for impairment could result in additional impairment charges in the future.

Rental property held and used by us is reviewed for impairment in the event that facts and circumstances indicate the carrying amount of an asset may not be recoverable.

In such an event, we compare the estimated future undiscounted cash flows associated with the asset to the asset's carrying amount, and if less than such carrying amount, recognize an impairment loss in an amount by which the carrying amount exceeds its fair value.

The cash flow estimates used both for determining recoverability and estimating fair value are inherently judgmental and reflect current and projected trends in rental, occupancy, capitalization, and discount rates, and estimated holding periods for the applicable assets.

The estimated fair value is based primarily on the income approach.

The income approach involves discounting the estimated income stream and reversion (presumed sale) value of a property over an estimated holding period to a present value at a risk-adjusted rate.

Discount rates and terminal capitalization rates utilized in this approach are derived from property-specific information, market transactions and other financial and industry data.

If economic and market conditions deteriorate beyond our current expectations, or if our expected holding periods for assets change, subsequent tests for impairment could result in additional impairment charges in the future.

For example, the Foxwoods outlet center, which is part of a casino property, continues to face leasing challenges that could lead to further declines in occupancy, rental revenues and cash flows in the future.

Such challenges, or a change in our expected holding period, could result in additional impairment charges recognized for the Foxwoods property.

In addition, one of our outlet centers has an estimated fair value significantly less than its recorded carrying value of approximately $ 112.6 million.

We continue to monitor facts and circumstances and events in future periods that could affect inputs such as the expected holding period, operating cash flow forecasts and capitalization rates, to determine whether an impairment charge is necessary.

We can provide no assurance that material impairment charges with respect to our properties will not occur in future periods.

Disposition of Properties

The following table sets forth certain summarized information regarding properties sold during the nine months ended September 30, 2022 and September 30, 2021:

Location Date Sold Square Feet

(in 000’s) Net Sales Proceeds

(in 000’s) Gain on Sale

2021 Disposition:

Jeffersonville Jeffersonville, Ohio January 2021 412 $ 8,100 $ —

(1) The rental properties sold did not meet the criteria to be reported as discontinued operations.

Developments of Consolidated Outlet Centers

The table below sets forth our consolidated outlet centers under development as of September 30, 2022:

The table below sets forth our consolidated outlet centers under development as of March 31, 2023:

Project Approximate Square Feet

(in 000’s) Costs Incurred to Date

(in 000’s) Estimated Total Net Cost

(millions) Costs Incurred to Date

(in millions) Projected Opening

New Development:

Nashville 290 $ 21.8 Fall 2023

Nashville 290 $ 142 - $ 150

$ 62.8 Fall 2023

During the second quarter of 2022, we purchased land in the Nashville, Tennessee area for approximately $ 8.8 million and began construction on the development of our wholly-owned outlet center.

2 unchanged sentences

We have an ownership interest in the following unconsolidated real estate joint ventures:

As of September 30, 2022

As of March 31, 2023

Joint Venture Outlet Center Location Ownership % Square Feet

4 unchanged sentences

Investments included in other liabilities:

Columbus, OH 50.0 % 355 $ ( 1.0 ) $ 70.5

Charlotte (2)

4 unchanged sentences

Texas City, TX 50.0 % 353 ( 15.9 ) 64.5

Columbus, OH 50.0 % 355 ( 2.9 ) 70.3

As of December 31, 2022

3 unchanged sentences

Investments included in investments in unconsolidated joint ventures:

Columbus Columbus, OH 50.0 % 355 $ 0.2 $ 70.9

RioCan Canada Various 50.0 % 665 73.8 —

6 unchanged sentences

Texas City, TX 50.0 % 353 ( 15.5 ) 64.5

(1) Net of debt origination costs of $ 1.3 million as of September 30, 2022 and $ 1.0 million as of December 31, 2021.

Columbus, OH 50.0 % 355 ( 2.4 ) 70.3

(1) Net of debt origination costs of $ 1.4 million as of March 31, 2023 and $ 1.5 million as of December 31, 2022.

(2) The negative carrying value is due to distributions exceeding contributions and increases or decreases from our equity in earnings of the joint venture.

Fees we received for various services provided to our unconsolidated joint ventures were recognized in management, leasing and other services as follows (in thousands):

Three months ended Nine months ended

September 30, September 30,

2022 2021 2022 2021

Three months ended

Management and marketing $ 545 $ 536

4 unchanged sentences

Our carrying value of investments in unconsolidated joint ventures differs from our share of the assets reported in the “Condensed Combined Balance Sheets - Unconsolidated Joint Ventures” shown below due to adjustments to the book basis, including intercompany profits on sales of services that are capitalized by the unconsolidated joint ventures.

The differences in basis (totaling $ 3.3 million and $ 3.4 million as of September 30, 2022 and December 31, 2021, respectively) are amortized over the various useful lives of the related assets.

In September 2022, the Columbus joint venture completed the refinance of its mortgage.

The new $ 71.0 million non-recourse loan has a maturity date of October 2032 and a fixed interest rate of 6.25 %.

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.

The differences in basis (totaling $ 3.1 million and $ 3.2 million as of March 31, 2023 and December 31, 2022, respectively) are amortized over the various useful lives of the related assets.

Condensed combined summary financial information of unconsolidated joint ventures accounted for using the equity method is as follows (in thousands):

Condensed Combined Balance Sheets - Unconsolidated Joint Ventures September 30, 2022 December 31, 2021

Condensed Combined Balance Sheets - Unconsolidated Joint Ventures March 31, 2023 December 31, 2022

Land $ 81,801 $ 81,716

14 unchanged sentences

Total liabilities and owners’ equity $ 376,984 $ 388,735

Three months ended Nine months ended

Condensed Combined Statements of Operations - Unconsolidated Joint Ventures September 30, September 30,

2022 2021 2022 2021

Three months ended

Condensed Combined Statements of Operations - Unconsolidated Joint Ventures March 31,

Revenues $ 22,128 $ 21,841

5 unchanged sentences

Interest expense ( 4,400 ) ( 2,916 )

Gain on sale of assets — — — 503

Other income 139 3

6 unchanged sentences

All of the Company’s debt is held by the Operating Partnership and its consolidated subsidiaries.

The Company guarantees the Operating Partnership’s obligations with respect to its unsecured lines of credit which have a total borrowing capacity of $ 520.0 million as of September 30, 2022.

The Company guarantees the Operating Partnership’s obligations with respect to its unsecured lines of credit which have a total borrowing capacity of $ 520.0 million as of March 31, 2023.

The Company also guarantees the Operating Partnership’s unsecured term loan.

The Operating Partnership had the following principal amounts outstanding on the debt guaranteed by the Company (in thousands):

September 30, 2022 December 31, 2021

March 31, 2023 December 31, 2022

Unsecured lines of credit $ — $ —

2 unchanged sentences

The debt of the Operating Partnership consisted of the following (in thousands):

September 30, 2022 December 31, 2021

March 31, 2023 December 31, 2022

Stated Interest Rate(s) Maturity Date Principal Book Value (1)

7 unchanged sentences

6.44 % - 7.65 % December 2024- December 2026 15,948 16,396 17,109 17,625

Southaven LIBOR + 1.80 % April 2023 40,144 40,122 40,144 40,087

Unsecured term loan LIBOR + 1.25 % April 2024 300,000 298,964 300,000 298,421

Unsecured lines of credit LIBOR + 1.20 % July 2025 — — — —

Southaven Adj SOFR + 2.00 % October 2026 51,700 51,353 51,700 51,346

Unsecured term loan Adj SOFR + 1.20 % January 2027 325,000 321,736 325,000 321,525

Unsecured lines of credit Adj SOFR + 1.20 % July 2025 — — — —

$ 1,442,648 $ 1,427,941 $ 1,443,809 $ 1,428,494

(1) Including premiums and net of debt discount and debt origination costs.

Excludes $ 3.1 million and $ 3.5 million of unamortized debt origination costs related to the unsecured lines of credit for the periods ended March 31, 2023 and December 31, 2022 respectively, recorded in prepaids and other assets in the Consolidated Balance Sheet.

(2) The effective interest rate assigned during the purchase price allocation to the Atlantic City mortgages assumed during the acquisition in 2011 was 5.05 %.

(3) Principal and interest due monthly with remaining principal due at maturity.

Certain of our properties, which had a net book value of approximately $ 143.2 million at September 30, 2022, serve as collateral for mortgages payable.

As of September 30, 2022, we maintained unsecured lines of credit that provided for borrowings of up to $ 520.0 million.

The unsecured lines of credit as of September 30, 2022 included a $ 20.0 million liquidity line and a $ 500.0 million syndicated line.

Certain of our properties, which had a net book value of approximately $ 140.9 million at March 31, 2023, serve as collateral for mortgages payable.

As of March 31, 2023, we maintained unsecured lines of credit that provided for borrowings of up to $ 520.0 million.

The unsecured lines of credit as of March 31, 2023 included a $ 20.0 million liquidity line and a $ 500.0 million syndicated line.

The syndicated line may be increased up to $ 1.2 billion through an accordion feature in certain circumstances.

1 unchanged sentence

For term loans, we may include a guaranty of completion as well as a principal guaranty ranging from 0 % to 15.5 % of principal.

As of September 30, 2022, the maximum amount of unconsolidated joint venture debt guaranteed by the Company was $ 10.0 million.

As of March 31, 2023, the maximum amount of unconsolidated joint venture debt guaranteed by the Company was $ 10.0 million.

The unsecured lines of credit and senior unsecured notes include covenants that require the maintenance of certain ratios, including debt service coverage and leverage, and limit the payment of dividends such that dividends and distributions will not exceed funds from operations, as defined in the agreements, for the prior fiscal year on an annual basis or 95 % of funds from operations on a cumulative basis.

As of September 30, 2022, we believe we were in compliance with all of our debt covenants.

As of March 31, 2023, we believe we were in compliance with all of our debt covenants.

Debt Maturities

Maturities of the existing long-term debt as of September 30, 2022 for the next five years and thereafter are as follows (in thousands):

Maturities and principal amortization of the existing long-term debt as of March 31, 2023 for the next five years and thereafter are as follows (in thousands):

Calendar Year Amount

10 unchanged sentences

The following table summarizes the terms and fair values of our derivative financial instruments, as well as their classifications within the consolidated balance sheets (notional amounts and fair values in thousands):

Effective Date Maturity Date Notional Amount Bank Pay Rate Company Fixed Pay Rate September 30, 2022 December 31, 2021

Effective Date Maturity Date Notional Amount Bank Pay Rate Company Fixed Pay Rate March 31, 2023 December 31, 2022

Assets (Liabilities) (1) :

Interest rate swaps:

July 1, 2019 February 1, 2024 $ 25,000 1 month LIBOR 1.75 % $ 847 $ ( 459 )

January 1, 2021 February 1, 2024 150,000 1 month LIBOR 0.60 % 7,349 828

January 1, 2021 February 1, 2024 100,000 1 month LIBOR 0.22 % 5,386 1,331

March 1, 2021 February 1, 2024 25,000 1 month LIBOR 0.24 % 1,340 326

July 1, 2019 February 1, 2024 $ 25,000 Daily Adjusted SOFR 1.68 % $ 656 $ 853

January 1, 2021 February 1, 2024 150,000 Daily Adjusted SOFR 0.53 % 5,361 6,966

January 1, 2021 February 1, 2024 100,000 Daily Adjusted SOFR 0.15 % 3,883 5,043

March 1, 2021 February 1, 2024 25,000 Daily Adjusted SOFR 0.18 % 962 1,256

February 1, 2024 (2)

February 1, 2026 - August 1, 2026 80,000 Daily Adjusted SOFR 3.40 % ( 169 ) —

Total $ 10,693 $ 14,118

(1) Asset balances are recorded in prepaids and other assets on the consolidated balance sheets and liabilities are recorded in other liabilities on the consolidated balance sheets.

The derivative financial instruments are comprised of interest rate swaps, which are designated and qualify as cash flow hedges, each with a separate counterparty.

(2) In March 2023, we entered into $ 80.0 million of forward-starting interest rate swaps with an effective date of February 1, 2024 and maturity dates ranging from February 1, 2026 to August 1, 2026.

In April 2023, the Company entered into an additional $ 20 million forward-starting interest rate swap with an effective date of February 1, 2024 and an adjusted SOFR rate of 3.09 %, which is not reflected in the tables above or in our consolidated financial statements as of March 31, 2023.

The maturity date of this derivative instrument is February 1, 2026.

The derivative financial instruments are comprised of interest rate swaps, which are designated and qualify as cash flow hedges, with various counterparties.

We do not use derivatives for trading or speculative purposes and currently do not have any derivatives that are not designated as hedges.

1 unchanged sentence

The following table represents the effect of the derivative financial instruments on the accompanying consolidated financial statements (in thousands):

Three months ended September 30, Nine months ended September 30,

2022 2021 2022 2021

Three months ended March 31,

Interest Rate Swaps:

11 unchanged sentences

Quoted Prices in Active Markets for Identical Assets or Liabilities Significant Observable Inputs Significant Unobservable Inputs

Fair value as of September 30, 2022:

Short-term government securities ( cash and cash equivalents)

$ 174,488 $ 174,488 $ — $ —

Bank certificate of deposit (prepaids and other assets) 20,000 20,000 — —

Fair value as of March 31, 2023:

Interest rate swaps (prepaids and other assets) 10,923 — 10,923 —

Total assets $ 209,410 $ 194,488 $ 14,922 $ —

Interest rate swaps (other liabilities) 230 — 230 —

Level 1 Level 2 Level 3

1 unchanged sentence

Fair value as of December 31, 2022:

Short-term government securities ( cash and cash equivalents)

$ 158,197 $ 158,197 $ — $ —

Interest rate swaps (prepaids and other assets) $ 14,118 $ — $ 14,118 $ —

Total assets $ 160,682 $ 158,197 $ 2,485 $ —

Interest rate swaps (other liabilities) $ — $ — $ — $ —

Total liabilities $ 459 $ — $ 459 $ —

Short-term government securities

Short-term government securities and our certificate of deposit are highly liquid investments, which are classified as Level 1 in the fair value hierarchy because they are valued using quoted market prices in an active market.

Interest rate swaps

2 unchanged sentences

The estimated fair value within the fair value hierarchy and recorded value of our debt consisting of senior unsecured notes, unsecured term loans, secured mortgages and unsecured lines of credit were as follows (in thousands):

September 30, 2022 December 31, 2021

March 31, 2023 December 31, 2022

Level 1 Quoted Prices in Active Markets for Identical Assets or Liabilities $ — $ —

6 unchanged sentences

Our other debt is classified as Level 3 given the unobservable inputs utilized in the valuation.

Our unsecured term loan, unsecured lines of credit and variable interest rate mortgages are all LIBOR based instruments.

Our unsecured term loan, unsecured lines of credit and variable interest rate mortgages are all SOFR based instruments.

When selecting the discount rates for purposes of estimating the fair value of these instruments, we evaluated the original credit spreads and do not believe that the use of them differs materially from current credit spreads for similar instruments and therefore the recorded values of these debt instruments is considered their fair value.

The carrying values of cash and cash equivalents, receivables, accounts payable, accrued expenses and other assets and liabilities are reasonable estimates of their fair values because of the short maturities of these instruments.

The carrying values of cash and cash equivalents, short-term investments, receivables, accounts payable, accrued expenses and other assets and liabilities are reasonable estimates of their fair values because of the short maturities of these instruments.

Short-term government securities and our certificates of deposit included in short-term investments are highly liquid investments, which are classified as Level 1 in the fair value hierarchy because they are valued l using quoted market prices in an active market.

Shareholders’ Equity of the Company

Dividend Declaration

In July 2022, the Company's Board of Directors declared a $0.20 cash dividend per common share payable on August 15, 2022 to each shareholder of record on July 29, 2022, and in its capacity as General Partner of the Operating Partnership, a $0.20 cash distribution per Operating Partnership unit to the Operating Partnership's unitholders.

In January 2023, the Company's Board of Directors declared a $ 0.22 cash dividend per common share payable on February 15, 2023 to each shareholder of record on January 31, 2023, and in its capacity as General Partner of the Operating Partnership, a $ 0.22 cash distribution per Operating Partnership unit to the Operating Partnership's unitholders.

At-the-Market Offering

3 unchanged sentences

We currently intend to use the net proceeds from the sale of shares pursuant to the ATM Offering for working capital and general corporate purposes.

As of September 30, 2022, we had approximately $ 60.1 million remaining available for sale under the ATM Offering program.

The following table sets forth information regarding settlements under our ATM offering program:

Three months ended September 30, Nine months ended September 30,

2022 2021 2022 2021

Number of common shares settled during the period — 331,682 — 10,009,263

Average price per share $ — $ 18.85 $ — $ 18.97

Aggregate gross proceeds (in thousands) $ — $ 6,253 $ — $ 189,868

Aggregate net proceeds after commissions and fees (in thousands) $ — $ 6,092 $ — $ 186,969

As of March 31, 2023, we had approximately $ 60.1 million remaining available for sale under the ATM Offering program.

There were no sales of our shares during the first quarters of 2023 or 2022.

Share Repurchase Program

In May 2021, the Company’s Board of Directors authorized the repurchase of up to $ 80.0 million of the Company’s outstanding shares through May 31, 2023.

This authorization replaced a previous repurchase authorization for approximately $ 80.0 million that expired in May 2021.

In June 2020, we amended our debt agreements primarily to improve future covenant flexibility and such amendments included a prohibition on share repurchases for twelve months starting July 1, 2020 (the “Repurchase Covenant”).

The Company temporarily suspended share repurchases for the twelve months starting July 1, 2020 and ending on June 30, 2021 in light of a repurchase covenant.

On July 1, 2021, the Repurchase Covenant expired.

Repurchases may be made from time to time through open market, privately-negotiated, structured or derivative transactions (including accelerated share repurchase transactions), or other methods of acquiring shares.

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The Company may, from time to time, enter into Rule 10b5-1 plans to facilitate the repurchase of its shares under this authorization.

The Company did not repurchase any shares for both the three and nine months ended September 30, 2022 and 2021.

The remaining amount authorized to be repurchased under the program as of September 30, 2022 was approximately $ 80.0 million.

The Company did not repurchase any shares for the three months ended March 31, 2023 and 2022.

The remaining amount authorized to be repurchased under the program as of March 31, 2023 was approximately $ 80.0 million.

Partners’ Equity of the Operating Partnership

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Likewise, when the Company repurchases its outstanding common shares, the Operating Partnership repurchases a corresponding Class B common limited partnership unit held by Tanger LP Trust.

The following table sets forth the changes in outstanding partnership units for the three and nine months ended September 30, 2022 and September 30, 2021:

The following table sets forth the changes in outstanding partnership units for the three months ended March 31, 2023 and March 31, 2022:

Limited Partnership Units

General Partnership Units Class A Class B Total

Balance June 30, 2021 1,100,000 4,794,643 102,520,580 107,315,223

Options exercised — — 17,240 17,240

Issuance of units — — 331,682 331,682

Grant of restricted common share awards by the Company, net of forfeitures — — 23,488 23,488

Units withheld for employee income taxes — — ( 8,756 ) ( 8,756 )

Balance September 30, 2021 1,100,000 4,794,643 102,884,234 107,678,877

Balance December 31, 2021 1,100,000 4,761,559 102,984,734 107,746,293

Options exercised — — 1,900 1,900

Issuance of units 100,000 — 9,909,263 9,909,263

Grant of restricted common share awards by the Company, net of forfeitures — — 512,398 512,398

Units withheld for employee income taxes — — ( 129,971 ) ( 129,971 )

Balance September 30, 2021 1,100,000 4,794,643 102,884,234 107,678,877

Balance June 30, 2022 1,100,000 4,761,559 103,294,792 108,056,351

Options exercised — — 5,000 5,000

Forfeitures of restricted common share awards by the Company — — ( 15,572 ) ( 15,572 )

Units withheld for employee income taxes — — ( 37,792 ) ( 37,792 )

Balance September 30, 2022 1,100,000 4,761,559 103,246,428 108,007,987

Balance March 31, 2022 1,100,000 4,761,559 103,369,061 108,130,620

Balance December 31, 2022 1,100,000 4,737,982 103,397,920 108,135,902

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Units withheld for employee income taxes — — ( 300,639 ) ( 300,639 )

Balance September 30, 2022 1,100,000 4,761,559 103,246,428 108,007,987

Balance March 31, 2023 1,100,000 4,737,982 104,216,253 108,954,235

Earnings Per Share of the Company

The following table sets forth a reconciliation of the numerators and denominators in computing the Company’s earnings per share (in thousands, except per share amounts):

Three months ended September 30, Nine months ended September 30,

2022 2021 2022 2021

Net income (loss) attributable to Tanger Factory Outlet Centers, Inc.

Three months ended March 31,

Net income attributable to Tanger Factory Outlet Centers, Inc.

$ 23,541 $ 20,518

Less allocation of earnings to participating securities ( 199 ) ( 215 )

Net income (loss) available to common shareholders of Tanger Factory Outlet Centers, Inc.

Net income available to common shareholders of Tanger Factory Outlet Centers, Inc.

$ 23,342 $ 20,303

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Basic earnings per common share:

Net income (loss) $ 0.22 $ ( 0.11 ) $ 0.61 $ ( 0.05 )

Net income $ 0.22 $ 0.20

Diluted earnings per common share:

Net income (loss) $ 0.22 $ ( 0.11 ) $ 0.60 $ ( 0.05 )

Net income $ 0.22 $ 0.19

We determine diluted earnings per share based on the weighted average number of common shares outstanding combined with the incremental weighted average shares that would have been outstanding assuming all potentially dilutive securities were converted into common shares at the earliest date possible.

Notional units granted under our equity compensation plan are considered contingently issuable common shares and are included in earnings per share if the effect is dilutive using the treasury stock method and the common shares would be issuable if the end of the reporting period were the end of the contingency period.

For both the three and nine months ended September 30, 2022, approximately 601,000 notional units were excluded from the computation and for both the three and nine months ended September 30, 2021, approximately 1.8 million notional units were excluded from the computation because these notional units either would not have been issuable if the end of the reporting period were the end of the contingency period or as they were anti-dilutive.

For the three months ended March 31, 2023, no notional units were excluded from the computation and for the three months ended March 31, 2022, approximately 139,000 notional units were excluded from the computation because these notional units either would not have been issuable if the end of the reporting period were the end of the contingency period or as they were anti-dilutive.

With respect to outstanding options, the effect of dilutive common shares is determined using the treasury stock method, whereby outstanding options are assumed exercised at the beginning of the reporting period and the exercise proceeds from such options and the average measured but unrecognized compensation cost during the period are assumed to be used to repurchase our common shares at the average market price during the period.

For both the three and nine months ended September 30, 2022, approximately 274,000 options were excluded from the computation and for both the three and nine months ended September 30, 2021, approximately 1.6 million options were excluded from the computation, as they were anti-dilutive.

For the three months ended March 31, 2023, approximately 503,300 options were excluded from the computation and for the three months ended March 31, 2022, approximately 297,000 options were excluded from the computation, as they were anti-dilutive.

The assumed exchange of the partnership units held by the Non-Company LPs as of the beginning of the year, which would result in the elimination of earnings allocated to the noncontrolling interest in the Operating Partnership, would have no impact on earnings per share since the allocation of earnings to a common limited partnership unit, as if exchanged, is equivalent to earnings allocated to a common share.

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The following table sets forth a reconciliation of the numerators and denominators in computing earnings per unit (in thousands, except per unit amounts):

Three months ended September 30, Nine months ended September 30,

2022 2021 2022 2021

Net income (loss) attributable to partners of the Operating Partnership $ 24,345 $ ( 11,071 ) $ 66,626 $ ( 4,133 )

Three months ended March 31,

Net income attributable to partners of the Operating Partnership $ 24,612 $ 21,462

Less allocation of earnings to participating securities ( 199 ) ( 215 )

Net income (loss) available to common unitholders of the Operating Partnership $ 24,113 $ ( 11,472 ) $ 65,957 $ ( 4,937 )

Net income available to common unitholders of the Operating Partnership $ 24,413 $ 21,247

Basic weighted average common units 108,826 108,282

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Basic earnings per common unit:

Net income (loss) $ 0.22 $ ( 0.11 ) $ 0.61 $ ( 0.05 )

Net income $ 0.22 $ 0.20

Diluted earnings per common unit:

Net income (loss) $ 0.22 $ ( 0.11 ) $ 0.60 $ ( 0.05 )

Net income $ 0.22 $ 0.19

We determine diluted earnings per unit based on the weighted average number of common units outstanding combined with the incremental weighted average units that would have been outstanding assuming all potentially dilutive securities were converted into common units at the earliest date possible.

Notional units granted under our equity compensation plan are considered contingently issuable common units and are included in earnings per unit if the effect is dilutive using the treasury stock method and the common units would be issuable if the end of the reporting period were the end of the contingency period.

With respect to outstanding options, the effect of dilutive common units is determined using the treasury stock method, whereby outstanding options are assumed exercised at the beginning of the reporting period and the exercise proceeds from such options and the average measured but unrecognized compensation cost during the period are assumed to be used to repurchase our common units at the average market price during the period.

The market price of a common unit is considered to be equivalent to the market price of a Company common share.

Certain of the Company’s unvested restricted common share awards contain non-forfeitable rights to distributions or distribution equivalents.

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We have a shareholder approved equity-based compensation plan, the Incentive Award Plan of Tanger Factory Outlet Centers, Inc.

and Tanger Properties Limited Partnership (as amended and restated on April 4, 2014), as amended (the “Plan”), which covers our non-employee directors, officers, employees and consultants.

and Tanger Properties Limited Partnership, as amended (the “Plan”), which covers our non-employee directors, officers, employees and consultants.

Per the Operating Partnership agreement, when a common share is issued by the Company, the Operating Partnership issues one corresponding unit of partnership interest to the Company’s wholly-owned subsidiary, the Tanger LP Trust.

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We recorded equity-based compensation expense in general and administrative expenses in our consolidated statements of operations as follows (in thousands):

Three months ended Nine months ended

September 30, September 30,

2022 2021 2022 2021

Three months ended

Restricted common shares (1)

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Notional unit performance awards (1)

1,227 962 3,802 3,257

Options 132 94

Total equity-based compensation $ 2,271 $ 2,708

(1) Each of the three and nine months ended September 30, 2022 and nine months ended September 30, 2021, include the accelerated recognition of compensation cost.

(1) The three months ended March 31, 2023 includes the reversal of compensation costs related to the voluntary resignation of an executive officer.

Equity-based compensation expense capitalized as a part of rental property and deferred lease costs were as follows (in thousands):

Three months ended Nine months ended

September 30, September 30,

2022 2021 2022 2021

Three months ended

Equity-based compensation expense capitalized $ 52 $ 38

Restricted Common Share and Restricted Share Unit Awards

During February 2022, the Company granted approximately 383,000 restricted common shares and restricted share units to the Company’s non-employee directors and the Company’s executive officers.

During March 2023, the Company granted approximately 323,829 restricted common shares and restricted share units to the Company’s non-employee directors and the Company’s executive officers.

The grant date fair value of the awards was $ 17.53 per share.

The restricted common shares vest ratably over a three year period on January 4th of each year for non-employee directors and on February 15th of each year for executive officers.

The restricted common shares vest ratably over a three year period on March 15th of each year for executive officers and over a one year period on March 15th for non-employee directors.

Compensation expense related to the amortization of the deferred compensation is being recognized in accordance with the vesting schedule of the restricted shares.

For certain shares that vest during the period, we withhold shares with value equivalent up to the employees’ maximum statutory obligation for the applicable income and other employment taxes, and remit cash to the appropriate taxing authorities.

The total number of shares withheld upon vesting were approximately 229,700 and 121,000 for the nine months ended September 30, 2022 and 2021, respectively.

The total number of shares withheld upon vesting were approximately 300,639 and 130,000 for the three months ended March 31, 2023 and 2022, respectively.

The total number of shares withheld was based on the value of the restricted common shares on the vesting date as determined by our closing share price on the day prior to the vesting date.

Total amounts paid for the employees’ tax obligation to taxing authorities were $ 3.7 million and $ 1.8 million for the nine months ended September 30, 2022 and 2021, respectively.

Total amounts paid for the employees’ tax obligation to taxing authorities were $ 5.6 million and $ 2.1 million for the three months ended March 31, 2023 and 2022, respectively.

These amounts are reflected as financing activities within the consolidated statements of cash flows.

2023 Performance Share Plan

During February 2022, the Compensation Committee of the Company approved the general terms of the Tanger Factory Outlet Centers, Inc.

During March 2023, the Compensation Committee of the Company approved the general terms of the Tanger Factory Outlet Centers, Inc.

2023 Performance Share Plan (the “2023 PSP”) covering the Company's executive officers whereby a maximum of approximately 489,122 restricted common shares may be earned if certain share price appreciation goals are achieved over a three year measurement period.

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Maximum number of restricted common shares that may be earned 489,122

February grant date fair value per share $ 11.68

March grant date fair value per share $ 12.08

(1) The number of restricted common shares received under the 2023 PSP will be determined on a pro-rata basis by linear interpolation between total shareholder return thresholds, both for absolute total shareholder return and for relative total shareholder return amongst the Company’s peer group.

(2) The peer group is based on companies included in the FTSE NAREIT Retail Index.

The fair values of the 2022 PSP awards granted during the nine months ended September 30, 2022 were determined at the grant dates using a Monte Carlo simulation pricing model and the following assumptions:

The fair values of the 2023 PSP awards granted during the three months ended March 31, 2023 were determined at the grant dates using a Monte Carlo simulation pricing model and the following assumptions:

Risk free interest rate (1)

6 unchanged sentences

On February 10, 2023, the measurement period for the 2020 Performance Share Plan (the “2020 PSP") expired.

Based on the Company’s relative total shareholder return over the three year measurement period, we issued 96,592 restricted common shares in February 2022, with 58,569 vesting immediately and the remaining 38,023 vesting in February one year thereafter, contingent upon continued employment with the Company through the vesting date.

Our absolute share price appreciation (or total shareholder return) for the 2019 OPP did not meet the minimum share price appreciation and no shares were earned under this component of the 2019 OPP.

Based on the Company’s absolute share price appreciation and relative total shareholder return over the three year measurement period, we issued 758,814 restricted common shares in February 2023, with 439,051 vesting immediately and the remaining 319,763 vesting in February 2024, contingent upon continued employment with the Company through the vesting date.

Accumulated Other Comprehensive Income (Loss) of the Company

The following table presents changes in the balances of each component of accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2022 (in thousands):

Tanger Factory Outlet Centers, Inc.

Accumulated Other Comprehensive Income (Loss) Noncontrolling Interest in Operating Partnership Accumulated Other Comprehensive Income (Loss)

Foreign Currency Cash flow hedges Total Foreign Currency Cash flow hedges Total

Balance June 30, 2022 $ ( 20,875 ) $ 11,455 $ ( 9,420 ) $ ( 1,137 ) $ 508 $ ( 629 )

Other comprehensive income (loss) before reclassifications ( 4,661 ) 4,054 ( 607 ) ( 214 ) 186 ( 28 )

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — ( 1,226 ) ( 1,226 ) — ( 56 ) ( 56 )

Balance September 30, 2022 $ ( 25,536 ) $ 14,283 $ ( 11,253 ) $ ( 1,351 ) $ 638 $ ( 713 )

The following table presents changes in the balances of each component of accumulated other comprehensive income (loss) for the three months ended March 31, 2023 and for three months ended March 31, 2022 (in thousands):

Tanger Factory Outlet Centers, Inc.

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Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — ( 3,277 ) ( 3,277 ) — ( 149 ) ( 149 )

Balance September 30, 2022 $ ( 25,536 ) $ 14,283 $ ( 11,253 ) $ ( 1,351 ) $ 638 $ ( 713 )

The following table presents changes in the balances of each component of accumulated other comprehensive loss for the three and nine months ended September 30, 2021 (in thousands):

Tanger Factory Outlet Centers, Inc.

Accumulated Other Comprehensive Income (Loss) Noncontrolling Interest in Operating Partnership Accumulated Other Comprehensive Income (Loss)

Foreign Currency Cash flow hedges Total Foreign Currency Cash flow hedges Total

Balance June 30, 2021 $ ( 17,685 ) $ ( 1,058 ) $ ( 18,743 ) $ ( 991 ) $ ( 66 ) $ ( 1,057 )

Other comprehensive loss before reclassifications ( 2,047 ) ( 222 ) ( 2,269 ) ( 95 ) ( 11 ) ( 106 )

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — 326 326 — 15 15

Balance September 30, 2021

$ ( 19,732 ) $ ( 954 ) $ ( 20,686 ) $ ( 1,086 ) $ ( 62 ) $ ( 1,148 )

Balance March 31, 2023 $ ( 24,361 ) $ 10,202 $ ( 14,159 ) $ ( 1,342 ) $ 489 $ ( 853 )

Tanger Factory Outlet Centers, Inc.

2 unchanged sentences

Balance December 31, 2021 $ ( 19,713 ) $ 1,952 $ ( 17,761 ) $ ( 1,084 ) $ 72 $ ( 1,012 )

Other comprehensive income before reclassifications 204 1,200 1,404 28 60 88

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges 3,463 1,032 4,495 167 51 218

Balance September 30, 2021

$ ( 19,732 ) $ ( 954 ) $ ( 20,686 ) $ ( 1,086 ) $ ( 62 ) $ ( 1,148 )

We expect within the next twelve months to reclassify into earnings as a decrease to interest expense approximately $ 10.5 million of the amounts recorded within accumulated other comprehensive loss related to the interest rate swap agreements in effect as of September 30, 2022.

Accumulated Other Comprehensive Income (Loss) of the Operating Partnership

The following table presents changes in the balances of each component of accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2022 (in thousands):

Foreign Currency Cash flow hedges Accumulated Other Comprehensive Income (Loss)

Balance June 30, 2022 $ ( 22,012 ) $ 11,963 $ ( 10,049 )

Other comprehensive income (loss) before reclassifications 1,172 7,056 8,228 54 324 378

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — 281 281 — 13 13

Balance September 30, 2022 $ ( 26,887 ) $ 14,921 $ ( 11,966 )

Balance March 31, 2022 $ ( 18,541 ) $ 9,289 $ ( 9,252 ) $ ( 1,030 ) $ 409 $ ( 621 )

We expect within the next twelve months to reclassify into earnings as a decrease to interest expense approximately $ 10.9 million of the amounts recorded within accumulated other comprehensive income related to the interest rate swap agreements in effect as of March 31, 2023.

Accumulated Other Comprehensive Income (Loss) of the Operating Partnership

The following table presents changes in the balances of each component of accumulated other comprehensive income (loss) for the three months ended March 31, 2023 (in thousands):

Foreign Currency Cash flow hedges Accumulated Other Comprehensive Income (Loss)

2 unchanged sentences

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — ( 3,426 ) ( 3,426 )

Balance September 30, 2022 $ ( 26,887 ) $ 14,921 $ ( 11,966 )

The following table presents changes in the balances of each component of accumulated other comprehensive loss for the three and nine months ended September 30, 2021 (in thousands):

Foreign Currency Cash flow hedges Accumulated Other Comprehensive Income (Loss)

Balance June 30, 2021 $ ( 18,676 ) $ ( 1,124 ) $ ( 19,800 )

Other comprehensive loss before reclassifications ( 2,142 ) ( 233 ) ( 2,375 )

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — 341 341

Balance September 30, 2021 $ ( 20,818 ) $ ( 1,016 ) $ ( 21,834 )

Foreign Currency Cash flow hedges Accumulated Other Comprehensive Income (Loss)

Balance March 31, 2023 $ ( 25,703 ) $ 10,691 $ ( 15,012 )

The following table presents changes in the balances of each component of accumulated other comprehensive loss for the three months ended March 31, 2022 (in thousands):

Balance December 31, 2021 $ ( 20,797 ) $ 2,024 $ ( 18,773 )

1 unchanged sentence

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — 294 294

Balance September 30, 2021 $ ( 20,818 ) $ ( 1,016 ) $ ( 21,834 )

Balance March 31, 2022 $ ( 19,571 ) $ 9,698 $ ( 9,873 )

Lease Agreements

As of September 30, 2022, we were the lessor to approximately 2,200 stores in our 30 consolidated outlet centers, under operating leases with initial terms that expire from 2022 to 2039, with certain agreements containing extension options.

As of March 31, 2023, we were the lessor to approximately 2,200 stores in our 29 consolidated outlet centers, under operating leases with initial terms that expire from 2023 to 2039, with certain agreements containing extension options.

We also have certain agreements that require tenants to pay their portion of reimbursable expenses such as common area expenses, utilities, insurance and real estate taxes.

The components of rental revenues are as follows (in thousands):

Three months ended Nine months ended

September 30, September 30,

2022 2021 2022 2021

Three months ended

Rental revenues - fixed $ 81,887 $ 81,312

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Expenditures included in accounts payable and accrued expenses were as follows (in thousands):

September 30, 2022 September 30, 2021

March 31, 2023 March 31, 2022

Costs relating to construction included in accounts payable and accrued expenses $ 30,331 $ 9,539

Dividends payable were as follows (in thousands):

September 30, 2022 September 30, 2021

Dividends payable $ — $ 19,913

Interest paid, net of interest capitalized was as follows (in thousands):

Nine months ended September 30,

Three months ended March 31,

Interest paid $ 18,352 $ 19,552

7 unchanged sentences

The amendments are effective immediately for all entities.

In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848) - Deferral of the Sunset Date of Topic 848, which defers the sunset date on the topic of reference rate reform from December 31, 2022, to December 31, 2024.

An entity may elect to apply the amendments on a full retrospective basis.

As of September 30, 2022 we had not adopted any of the optional expedients or exceptions, however in October 2022 we elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives.

This was done as we modified all of our current interest rate derivative contract indexes from LIBOR to Adjusted SOFR.

In October 2022 we elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives.

This was done as we modified all of our current interest rate derivative contracts, changing the indexes from LIBOR to Adjusted SOFR.

We have and will continue to elect to apply practical expedients related to contract modifications, changes in critical terms, and updates to the designated hedged risk(s) as qualifying changes are made to applicable debt and derivative instruments.

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Subsequent Events

Memphis Consolidated Joint Venture

In October 2022, the Southaven, MS joint venture amended and restated its secured term loan, increasing the outstanding balance to $ 51.7 million from $ 40.1 million, extending maturity from April 2023 to October 2026 plus a one year extension option, with an interest rate of Adjusted SOFR plus 200 basis points.

Operating Partnership Term Loan

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 to January 2027 plus a one-year extension option.

The interest rate changed from LIBOR + 1.25 % to Adjusted SOFR + 1.20 % based on our current credit rating.

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.

Dividend Declaration

In October 2022, the Company's Board of Directors declared a $ 0.22 cash dividend per common share payable on November 15, 2022 to each shareholder of record on October 31, 2022, and in its capacity as General Partner of the Operating Partnership a $ 0.22 cash distribution per Operating Partnership unit to the Operating Partnership's unitholders.

In April 2023, the Company's Board of Directors declared a $ 0.245 cash dividend per common share payable on May 15, 2023 to each shareholder of record on April 28, 2023, and a $ 0.245 cash distribution per Operating Partnership unit to the Operating Partnership's unitholders.

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-Q

Item 1. Financial Statements