What changed in this filing

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Item 1. Financial Statements

2023-08-04 compared with 2023-04-28 · 169 added, 82 removed, 538 unchanged (32% of the section changed)

3 unchanged sentences

(In thousands, except unit data, unaudited)

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

Rental property:

24 unchanged sentences

Partners’ Equity:

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

General partner, 1,100,000 units outstanding at June 30, 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 104,085,781 and 103,397,920 Class B common units outstanding at June 30, 2023 and December 31, 2022, respectively

517,400 521,168

8 unchanged sentences

(In thousands, except per unit data, unaudited)

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2023 2022 2023 2022

Rental revenues $ 104,588 $ 101,409 $ 208,170 $ 206,018

25 unchanged sentences

(In thousands, unaudited)

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2023 2022 2023 2022

Net income $ 25,300 $ 20,819 $ 50,160 $ 42,281

11 unchanged sentences

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

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

Net loss ( 3,887 ) 24,706 — 20,819 — 20,819

Other comprehensive loss — — ( 176 ) ( 176 ) ( 176 )

Compensation under Incentive Award Plan — 4,299 — 4,299 — 4,299

Forfeiture of 13,062 common units

Withholding of 62,007 common units for employee income taxes

— ( 1,057 ) — ( 1,057 ) — ( 1,057 )

Grant of 800 restricted common share awards by the Company

Common distributions ($ 0.20 per unit)

( 220 ) ( 21,672 ) — ( 21,892 ) — ( 21,892 )

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

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

6 unchanged sentences

— ( 3,203 ) — ( 3,203 ) — ( 3,203 )

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

Grant of 499,336 restricted common share awards by the Company, net of forfeitures

Common distributions ($ 0.3825 per unit)

( 421 ) ( 41,655 ) — ( 42,076 ) — ( 42,076 )

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

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

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

Net income 253 25,047 — 25,300 — $ 25,300

Other comprehensive income — — 854 854 — 854

Compensation under Incentive Award Plan — 3,452 — 3,452 — 3,452

Issuance of 4,600 common units upon exercise of options

— 28 — 28 — 28

Forfeiture of 73,440 common units

Withholding of 61,632 common units for employee income taxes

— ( 1,194 ) — ( 1,194 ) — ( 1,194 )

Common distributions ( 0.245 per unit)

( 270 ) ( 26,733 ) — ( 27,003 ) — ( 27,003 )

Balance, June 30, 2023 $ 4,503 $ 517,400 $ ( 14,160 ) $ 507,743 $ — $ 507,743

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

2 unchanged sentences

Compensation under Incentive Award Plan — 5,775 — 5,775 — 5,775

Issuance of 2,600 common shares upon exercise of options

Issuance of 7,200 common units upon exercise of options

— 43 — 43 — $ 43

Withholding of 362,271 common units for employee income taxes

— ( 6,843 ) — ( 6,843 ) — ( 6,843 )

Grant of 1,116,372 restricted common share awards by the Company

Grant of 1,042,932 restricted common share awards by the Company, net of forfeitures

Common distributions ($ 0.4650 per unit)

( 512 ) ( 52,156 ) — ( 52,668 ) ( 248 ) ( 52,916 )

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

Balance, June 30, 2023 $ 4,503 $ 517,400 $ ( 14,160 ) $ 507,743 $ — $ 507,743

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

2 unchanged sentences

(In thousands, unaudited)

Three months ended March 31,

Six months ended June 30,

OPERATING ACTIVITIES

9 unchanged sentences

Distributions of cumulative earnings from unconsolidated joint ventures 3,721 4,775

Other non-cash — ( 2,418 )

Changes in other assets and liabilities:

4 unchanged sentences

Additions to rental property ( 71,830 ) ( 25,717 )

Additions to investments in unconsolidated joint ventures ( 2,633 ) —

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

Proceeds from short-term investments 37,080 —

2 unchanged sentences

Additions to deferred lease costs ( 1,384 ) ( 1,076 )

Other investing activities 3,071 1,686

Payments for other investing activities ( 2,036 ) —

Proceeds from other investing activities 3,821 1,728

Net cash used in investing activities ( 35,037 ) ( 8,095 )

4 unchanged sentences

Employee income taxes paid related to shares withheld upon vesting of equity awards ( 6,843 ) ( 3,203 )

Additions to deferred financing costs ( 17 ) ( 227 )

Proceeds from exercise of options 43 15

3 unchanged sentences

Effect of foreign currency on cash and cash equivalents ( 356 ) ( 27 )

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

Net increase in cash and cash equivalents 831 33,056

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 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.

As of June 30, 2023, we owned and operated 29 consolidated outlet centers, with a total gross leasable area of approximately 11.3 million square feet, which were 97 % occupied and contained approximately 2,300 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.

9 unchanged sentences

Tanger LP Trust holds a limited partnership interest.

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.

As of June 30, 2023, the Company and its wholly-owned subsidiaries owned 105,185,781 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 $ 50.3 million as of March 31, 2023.

Straight-line rent adjustments recorded as a receivable in prepaids and other assets on the consolidated balance sheets was approximately $ 50.1 million as of June 30, 2023.

Impairment of Long-Lived Assets

12 unchanged sentences

Developments of Consolidated Outlet Centers

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

The table below sets forth our consolidated outlet centers under development as of June 30, 2023:

Project Approximate Square Feet

1 unchanged sentence

(millions) Costs Incurred to Date

(in millions) Projected Opening

(in millions) 1

Projected Opening

New Development:

Nashville 290 $ 143 - $ 147

$ 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.

$ 89.3 October 2023

(1) I ncludes the land purchased for the Nashville, Tennessee outlet for approximately $ 8.8 million.

This is included in Land on our consolidated balance sheet.

Investments in Unconsolidated Real Estate Joint Ventures

1 unchanged sentence

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

As of March 31, 2023

As of June 30, 2023

Joint Venture Outlet Center Location Ownership % Square Feet

25 unchanged sentences

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.

(1) Net of debt origination costs of $ 2.3 million as of June 30, 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

Three months ended Six months ended

June 30, June 30,

2023 2022 2023 2022

Management and marketing $ 565 $ 552 $ 1,109 $ 1,088

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 $ 3.1 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.

The differences in basis (totaling $ 3.1 million and $ 3.2 million as of June 30, 2023 and December 31, 2022, respectively) are amortized over the various useful lives of the related assets.

Galveston/Houston

In June 2023, the Galveston/Houston joint venture completed the refinance of its mortgage.

The new $ 58.0 million loan has a maturity date of June 2026 and an interest rate of Daily SOFR + 3.00 %.

In conjunction with this refinance, the joint venture entered into a $ 29.0 million interest rate swap that fixes Daily SOFR at 4.44 % until December 2025.

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 March 31, 2023 December 31, 2022

Condensed Combined Balance Sheets - Unconsolidated Joint Ventures June 30, 2023 December 31, 2022

Land $ 82,648 $ 81,716

14 unchanged sentences

Total liabilities and owners’ equity $ 375,227 $ 388,735

Three months ended

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

Three months ended Six months ended

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

2023 2022 2023 2022

Revenues $ 21,804 $ 21,666 $ 43,933 $ 43,507

13 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 March 31, 2023.

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 June 30, 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):

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

Unsecured lines of credit $ — $ —

2 unchanged sentences

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

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

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

12 unchanged sentences

(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.

Excludes $ 2.9 million and $ 3.5 million of unamortized debt origination costs related to the unsecured lines of credit for the periods ended June 30, 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 $ 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.

Certain of our properties, which had a net book value of approximately $ 139.6 million at June 30, 2023, serve as collateral for mortgages payable.

As of June 30, 2023, we maintained unsecured lines of credit that provided for borrowings of up to $ 520.0 million.

The unsecured lines of credit as of June 30, 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 17.2 % of principal.

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

As of June 30, 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 March 31, 2023, we believe we were in compliance with all of our debt covenants.

As of June 30, 2023, we believe we were in compliance with all of our debt covenants.

In May 2023, Fitch Ratings assigned a first-time ‘BBB’ long-term issuer default rating to the Company and the Operating Partnership, along with a Stable rating outlook.

Fitch also assigned a ‘BBB’ rating to Operating Partnership’s senior unsecured debt, which includes our lines of credit, a term loan and senior notes.

As a result, the applicable pricing margin on each of our unsecured lines of credit and our term loan was reduced by 25 basis points (including a 5 basis point reduction in the facility fee on the unsecured lines of credit).

Debt Maturities

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):

Maturities and principal amortization of the existing long-term debt as of June 30, 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 March 31, 2023 December 31, 2022

Effective Date Maturity Date Notional Amount Bank Pay Rate Company Fixed Pay Rate June 30, 2023 December 31, 2022

Assets (Liabilities) (1) :

8 unchanged sentences

(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.

(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.

(2) During March and April 2023, we entered into $ 100.0 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 July 2023, we entered into an additional $ 25 million forward-starting interest rate swap with an effective date of February 1, 2024 and an adjusted SOFR rate of 3.79 %, which is not reflected in the tables above or in our consolidated financial statements as of June 30, 2023.

The maturity of this swap is January 1, 2027 .

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

2 unchanged sentences

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

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2023 2022 2023 2022

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 March 31, 2023:

Fair value as of June 30, 2023:

Interest rate swaps (prepaids and other assets) 10,294 — 10,294 —

Interest rate swaps (other liabilities) 230 — 230 —

Level 1 Level 2 Level 3

2 unchanged sentences

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

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

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):

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

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

12 unchanged sentences

Dividend Declaration

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.

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 in its capacity as General Partner of the Operating Partnership, a $ 0.245 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 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.

As of June 30, 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 two quarters of 2023 or for the full year 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.

In May 2023, the Company’s Board of Directors authorized the repurchase of up to $ 100.0 million of the Company’s outstanding shares through May 31, 2025, replacing the previously authorized plan to repurchase up to $ 80.0 million of the Company’s outstanding shares through May 31, 2023.

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.

1 unchanged sentence

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 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.

The Company did not repurchase any shares in both the three and six months ended June 30, 2023 and 2022.

The remaining amount authorized to be repurchased under the program as of June 30, 2023 was approximately $ 100.0 million.

Partners’ Equity of the Operating Partnership

2 unchanged sentences

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 months ended March 31, 2023 and March 31, 2022:

The following table sets forth the changes in outstanding partnership units for the six months ended June 30, 2023 and June 30, 2022:

Limited Partnership Units

General Partnership Units Class A Class B Total

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

Options exercised — — 800 800

Forfeitures of restricted common share awards by the Company — — ( 13,062 ) ( 13,062 )

Units withheld for employee income taxes — — ( 62,007 ) ( 62,007 )

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

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

2 unchanged sentences

Units withheld for employee income taxes — — ( 191,978 ) ( 191,978 )

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

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

Options exercised — — 4,600 4,600

Forfeitures of restricted common share awards by the Company — — ( 73,440 ) ( 73,440 )

Units withheld for employee income taxes — — ( 61,632 ) ( 61,632 )

Balance June 30, 2023 1,100,000 4,737,982 104,085,781 108,823,763

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

2 unchanged sentences

Units withheld for employee income taxes — — ( 362,271 ) ( 362,271 )

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

Balance June 30, 2023 1,100,000 4,737,982 104,085,781 108,823,763

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 March 31,

Three months ended June 30, Six months ended June 30,

2023 2022 2023 2022

Net income attributable to Tanger Factory Outlet Centers, Inc.

13 unchanged sentences

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 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.

For the three and six months ended June 30, 2023, no notional units were excluded from the computation and for the three and six months ended June 30, 2022, approximately 961,000 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 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.

For the three and six months ended June 30, 2023, approximately 499,700 options were excluded from the computation and for the three and six months ended June 30, 2022, approximately 282,000 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.

4 unchanged sentences

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 March 31,

Three months ended June 30, Six months ended June 30,

2023 2022 2023 2022

Net income attributable to partners of the Operating Partnership $ 25,300 $ 20,819 $ 49,912 $ 42,281

11 unchanged sentences

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.

4 unchanged sentences

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

Effective May 19, 2023, the Plan was amended and restated to, among other things, increase the number of shares authorized for issuance under the plan to 21.3 million shares and extend the term of the plan by an additional ten years .

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.

2 unchanged sentences

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

Three months ended

Three months ended Six months ended

June 30, June 30,

2023 2022 2023 2022

Restricted common shares (1)

1 unchanged sentence

Notional unit performance awards (1)

1,262 1,529 1,646 2,574

Options 137 78 270 172

Total equity-based compensation $ 3,381 $ 4,251 $ 5,652 $ 6,959

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

(1) The six months ended June 30, 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

Three months ended Six months ended

June 30, June 30,

2023 2022 2023 2022

Equity-based compensation expense capitalized $ 71 $ 47 $ 123 $ 86

5 unchanged sentences

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 300,639 and 130,000 for the three months ended March 31, 2023 and 2022, respectively.

The total number of shares withheld upon vesting were approximately 363,000 and 192,000 for the six months ended June 30, 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 $ 5.6 million and $ 2.1 million for the three months ended March 31, 2023 and 2022, respectively.

Total amounts paid for the employees’ tax obligation to taxing authorities were $ 6.8 million and $ 3.2 million for the six months ended June 30, 2023 and 2022, respectively.

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

20 unchanged sentences

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

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:

The fair values of the 2023 PSP awards granted during the six months ended June 30, 2023 were determined at the grant dates using a Monte Carlo simulation pricing model and the following assumptions:

Risk free interest rate (1)

8 unchanged sentences

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 months ended March 31, 2023 and for three months ended March 31, 2022 (in thousands):

The following table presents changes in the balances of each component of accumulated other comprehensive income (loss) for the three and six months ended June 30, 2023 and for three and six months ended June 30, 2022 (in thousands):

Tanger Factory Outlet Centers, Inc.

1 unchanged sentence

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

Balance March 31, 2023 $ ( 24,361 ) $ 10,202 $ ( 14,159 ) $ ( 1,344 ) $ 489 $ ( 855 )

Other comprehensive income before reclassifications 1,174 — 1,174 53 — 53

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — ( 357 ) ( 357 ) — ( 16 ) ( 16 )

Balance June 30, 2023 $ ( 23,187 ) $ 9,845 $ ( 13,342 ) $ ( 1,291 ) $ 473 $ ( 818 )

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 December 31, 2022 $ ( 24,516 ) $ 13,479 $ ( 11,037 ) $ ( 1,351 ) $ 638 $ ( 713 )

Other comprehensive income (loss) before reclassifications 155 — 155 9 — 9

Other comprehensive income before reclassifications 1,329 — 1,329 60 — 60

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — ( 3,634 ) ( 3,634 ) — ( 165 ) ( 165 )

Balance June 30, 2023 $ ( 23,187 ) $ 9,845 $ ( 13,342 ) $ ( 1,291 ) $ 473 $ ( 818 )

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

Other comprehensive income (loss) before reclassifications ( 2,334 ) 1,885 ( 449 ) ( 107 ) 86 ( 21 )

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

Tanger Factory Outlet Centers, Inc.

4 unchanged sentences

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — 562 562 — 26 26

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.

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

We expect within the next twelve months to reclassify into earnings as a decrease to interest expense approximately $ 9.3 million of the amounts recorded within accumulated other comprehensive income related to the interest rate swap agreements in effect as of June 30, 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):

The following table presents changes in the balances of each component of accumulated other comprehensive income (loss) for the three and six months ended June 30, 2023 (in thousands):

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

Balance December 31, 2022 $ ( 25,867 ) $ 14,117 $ ( 11,750 )

Other comprehensive income (loss) before reclassifications 164 — 164

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 March 31, 2023 $ ( 25,705 ) $ 10,691 $ ( 15,014 )

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):

Other comprehensive income before reclassifications 1,227 — 1,227

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — ( 373 ) ( 373 )

Balance June 30, 2023 $ ( 24,478 ) $ 10,318 $ ( 14,160 )

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

Balance December 31, 2022 $ ( 25,867 ) $ 14,117 $ ( 11,750 )

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 — ( 3,799 ) ( 3,799 )

Balance June 30, 2023 $ ( 24,478 ) $ 10,318 $ ( 14,160 )

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

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

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

Other comprehensive income (loss) before reclassifications ( 2,441 ) 1,971 ( 470 )

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

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

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

Other comprehensive income (loss) before reclassifications ( 1,215 ) 9,351 8,136

Reclassification out of accumulated other comprehensive income (loss) into other income (expense) for foreign currency and interest expense for cash flow hedges — 588 588

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

Lease Agreements

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.

As of June 30, 2023, we were the lessor to approximately 2,300 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

Three months ended Six months ended

June 30, June 30,

2023 2022 2023 2022

Rental revenues - fixed $ 82,815 $ 78,682 $ 164,702 $ 159,991

6 unchanged sentences

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

March 31, 2023 March 31, 2022

June 30, 2023 June 30, 2022

Costs relating to construction included in accounts payable and accrued expenses $ 24,953 $ 15,223

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

Three months ended March 31,

Six months ended June 30,

Interest paid $ 20,527 $ 21,586

16 unchanged sentences

Dividend Declaration

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.

In July 2023, the Company's Board of Directors declared a $ 0.245 cash dividend per common share payable on August 15, 2023 to each shareholder of record on July 31, 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