-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IDxZMHvaFXe70KsDtIUqHaE2Fn9cgh2gcuVI2QnfleasNmMRmpcNowT8UEwwP8F2 8HzfJ6o935fBSv6RsQgbwQ== 0000899715-09-000122.txt : 20090424 0000899715-09-000122.hdr.sgml : 20090424 20090423182406 ACCESSION NUMBER: 0000899715-09-000122 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20090331 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20090424 DATE AS OF CHANGE: 20090423 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TANGER FACTORY OUTLET CENTERS INC CENTRAL INDEX KEY: 0000899715 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 561815473 STATE OF INCORPORATION: NC FISCAL YEAR END: 0101 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11986 FILM NUMBER: 09767606 BUSINESS ADDRESS: STREET 1: 3200 NORTHLINE AVENUE SUITE 360 CITY: GREENSBORO STATE: NC ZIP: 27408 BUSINESS PHONE: 3362923010 MAIL ADDRESS: STREET 1: 3200 NORTHLINE AVENUE SUITE 360 CITY: GREENSBORO STATE: NC ZIP: 27408 8-K 1 tfoc8k03312009.htm TFOC 8-K tfoc8k03312009.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

___________

FORM 8-K

Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934


Date of Report (date of earliest event reported):  April 23, 2009


TANGER FACTORY OUTLET CENTERS, INC.
 
_________________________________________
(Exact name of registrant as specified in its charter)


                           
             North Carolina
(State or other jurisdiction of Incorporation)
 
 1-11986
(Commission File Number)
 
                56-1815473                
(I.R.S. Employer Identification Number)


             3200 Northline Avenue, Greensboro, North Carolina 27408             
(Address of principal executive offices) (Zip Code)
                           (336) 292-3010                                
(Registrants’ telephone number, including area code)
 
                           N/A                                
(former name or former address, if changed since last report)
 
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

    Soliciting material pursuant to Rule 14a-12 under the Exchange
 
  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 

 
 
 


 
Item 2.02                      Results of Operations and Financial Condition
 
On April 23, 2009, Tanger Factory Outlet Centers, Inc. (the “Company”) issued a press release announcing its results of operations and financial condition as of and for the quarter ended March 31, 2009.  A copy of the Company’s press release is hereby furnished as Exhibit 99.1 to this report on Form 8-K.  The information contained in this report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” with the Securities and Exchange Commission nor incorporated by reference in any registration statement filed by the Company under the Securities Act of 1933, as amended, unless specified otherwise.
 
Item 7.01                      Regulation FD Disclosure
 
On April 23, 2009, the Company made publicly available certain supplemental operating and financial information for the quarter ended March 31, 2009.  This supplemental operating and financial information is hereby attached to this current report as exhibit 99.2.  The information contained in this report on Form 8-K, including Exhibit 99.2, shall not be deemed “filed” with the Securities and Exchange Commission nor incorporated by reference in any registration statement filed by the Company under the Securities Act of 1933, as amended, unless specified otherwise.
 
Item 9.01                      Financial Statements and Exhibits
 
(c) Exhibits

The following exhibits are included with this Report:

Exhibit 99.1
Press release announcing the results of operations and financial condition of the Company as of and for the quarter ended March 31, 2009.

Exhibit 99.2
Supplemental operating and financial information of the Company as of and for the quarter ended March 31, 2009.


SIGNATURES

 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 

Dated:  April 23, 2009

TANGER FACTORY OUTLET CENTERS, INC.

By:           /s/ Steven B. Tanger
Steven B. Tanger
President and Chief Executive Officer

 
2
 


_____________________________________________________________________________________________

EXHIBIT INDEX

 
  
Exhibit No.
 


99.1  
Press release announcing the results of operations and financial condition of the Company as of and for the quarter ended March 31, 2009.

  99.2  
Supplemental operating and financial information of the Company as of and for the quarter ended March 31, 2009.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3
 EX-99.1 2 tfoc8k03312009ex99-1.htm EXHIBIT 99.1 tfoc8k03312009ex99-1.htm
Tanger Factory Outlet Centers, Inc.

News Release

For Release:  IMMEDIATE RELEASE
Contact:        Jim Williams
          (336) 834-6800

TANGER REPORTS FIRST QUARTER 2009 RESULTS
Funds From Operation Increases 12.8%, Same Center Net Operating Income Up 2.4%

Greensboro, NC, April 23, 2009, Tanger Factory Outlet Centers, Inc. (NYSE:SKT) today reported funds from operations (“FFO”) available to common shareholders, a widely accepted supplemental measure of REIT performance, for the three months ended March 31, 2009 was $24.7 million, or $0.66 per share, as compared to FFO of $21.9 million, or $0.59 per share, for the three months ended March 31, 2008, representing a 12.8% increase in total FFO and a 11.9% increase in FFO per share.  Net income available to common shareholders for the three months ended March 31, 2009 was $28.9 million, or $0.92 per share, as compared to net income of $4.9 million, or $0.16 per share for the first quarter of 2008.

Net income and FFO per share amounts above are on a diluted basis.  FFO is a supplemental non-GAAP financial measure used as a standard in the real estate industry to measure and compare the operating performance of real estate companies. A complete reconciliation containing adjustments from GAAP net income to FFO is included in this release.

First Quarter Highlights
 
·  
Dividend increase approved by Board of Directors to raise the quarterly common share cash dividend from $0.38 to $0.3825 per share, $1.53 per share annualized, representing the 16th consecutive year of increased dividends
 
·  
Announced exchange offer for 3.75% Exchangeable Senior Notes
 
·  
2.4% increase in same center net operating income
 
·  
14.5% increase in average base rental rates on leases renewed during the quarter, compared to 17.9% last year
 
·  
42.4% increase in average base rental rates on released space during the quarter, compared to 41.7% last year
 
·  
93.5% period-end wholly-owned portfolio occupancy rate, compared to 95.3% last year
 
·  
$338 per square foot in reported tenant comparable sales for the rolling twelve months ended March 31, 2009
 

Steven B. Tanger, President and Chief Executive Officer, commented, “During the first quarter we announced that our board of directors had approved an increase in our common share dividend for the 16th consecutive year.  We also announced the exchange offer relating to our 3.75% Exchangeable Senior Notes.  With a successful completion of this offering, our 2011 debt maturities will be substantially reduced.”

Portfolio Operating Results

During the first quarter of 2009, Tanger executed 213 leases, totaling 994,000 square feet throughout its wholly-owned portfolio.  Lease renewals during the first quarter accounted for 806,000 square feet, generated a 14.5% increase in average base rental rates and represented 53.8% of the square feet originally scheduled to expire during 2009.  Average base rental increases on re-tenanted space during the first quarter averaged 42.4% and accounted for the remaining 188,000 square feet.

Same center net operating income increased 2.4% for the first quarter of 2009 compared to 2.5% in the fourth quarter of 2008 and 5.7% in the first quarter of 2008.  Reported tenant comparable sales for our wholly owned properties for the rolling twelve months ended March 31, 2009 decreased 3.2% to $338 per square foot due to the current downturn in the economy. Reported tenant comparable sales numbers exclude our centers in Foley, Alabama and on Highway 501 in Myrtle Beach, South Carolina, both of which underwent major renovations during last year.
 
Cash Dividend Increased

On April 9, 2009, Tanger announced that its Board of Directors approved an increase in the annual cash dividend on its common shares from $1.52 per share to $1.53 per share. Simultaneously, the Board of Directors declared a quarterly dividend of $0.3825 per share for the first quarter ended March 31, 2009. A cash dividend of $0.3825 per share will be payable on May 15, 2009 to holders of record on April 30, 2009.  Tanger has increased its dividend each year since becoming a public company in May of 1993.

Exchange Offer Launched

On April 9, 2009, Tanger also announced that it had commenced an offer to exchange common shares of Tanger for any and all of the outstanding 3.75% Exchangeable Senior Notes due 2026 of Tanger Properties Limited Partnership.  For each $1,000 principal amount of exchangeable notes validly tendered, note holders will receive 27.7434 common shares, which represents an exchange price of approximately $36.04 per share, plus $215 paid in the form of additional common shares (based on the average of the volume weighted average prices of Tanger’s common shares over an eight trading day averaging period beginning April 24, 2009 and ending May 5, 2009), subject to a minimum and a maximum number of common shares as described in the prospectus for the offer.  Holders will also receive a cash payment for accrued and unpaid interest on the exchangeable notes up to but not including the settlement date.  The offer is scheduled to expire at 5:00 p.m., New York City time, on Thursday, May 7, 2009. As of April 8, 2009, there was $149,500,000 principal amount of 3.75 % Exchangeable Notes outstanding.
 
Balance Sheet Summary

As of March 31, 2009, Tanger had a total market capitalization of approximately $2.1 billion including $849.2 million of debt outstanding, equating to a 40.5% debt-to-total market capitalization ratio.  As of March 31, 2009, 77.8% of Tanger’s debt was at fixed interest rates and the company had $188.4 million outstanding on its $325.0 million in available unsecured lines of credit.  During the first quarter of 2009, Tanger continued to maintain a strong interest coverage ratio of 3.34 times, compared to 3.22 times during the first quarter of last year.

2009 FFO Per Share Guidance

Based on current market conditions and the strength and stability of its core portfolio, the company currently believes its net income available to common shareholders for 2009 will be between $1.35 and $1.45 per share and its FFO available to common shareholders for 2009 will be between $2.73 and $2.83 per share.  The company’s earnings estimates do not include the impact of the exchange offer described above, nor any potential gains on the sale of land parcels or the impact of any potential sales or acquisitions of properties.  The following table provides the reconciliation of estimated diluted net income available to common shareholders per share to estimated diluted FFO available to common shareholders per share:

For the twelve months ended December 31, 2009:
    
 
Low Range
High Range
Estimated diluted net income per share
$1.35
$1.45
Non-controlling interest, gain/loss on acquisition of real
    
 
estate, depreciation and amortization uniquely
    
 
significant to real estate including non-controlling
    
 
interest share and our share of joint ventures
 1.38
 1.38
Estimated diluted FFO per share
$2.73
$2.83


 
2
 


First Quarter Conference Call

Tanger will host a conference call to discuss its first quarter results for analysts, investors and other interested parties on Friday, April 24, 2009, at 10:00 A.M. eastern time.  To access the conference call, listeners should dial 1-877-277-5113 and request to be connected to the Tanger Factory Outlet Centers First Quarter Financial Results call.  Alternatively, the call will be web cast by CCBN and can be accessed at Tanger Factory Outlet Centers, Inc.'s web site at http://www.tangeroutlet.com/investorrelations/news/ under the News Releases section.  A telephone replay of the call will be available from April 24, 2009 starting at 1:00 P.M. Eastern Time through May 1, 2009, by dialing 1-800-642-1687 (conference ID # 92097927).  Additionally, an online archive of the broadcast will also be available through May 1, 2009.

About Tanger Factory Outlet Centers

Tanger Factory Outlet Centers, Inc.(NYSE:SKT), a fully integrated, self-administered and self-managed publicly traded REIT, presently owns and operates 31 outlet centers in 21 states coast to coast, totaling approximately 9.2 million square feet of gross leasable area.  Tanger also manages for a fee and owns an interest in two outlet centers containing approximately 950,000 square feet.  Tanger is filing a Form 8-K with the Securities and Exchange Commission that includes a supplemental information package for the quarter ended March 31, 2009.  For more information on Tanger Outlet Centers, visit our web site at www.tangeroutlet.com.

Estimates of future net income per share and FFO per share are by definition, and certain other matters discussed in this press release regarding our re-merchandising strategy, the renewal and re-tenanting of space, tenant sales and sales trends, interest rates, funds from operations, the development of new centers, and coverage of the current dividend may be forward-looking statements within the meaning of the federal securities laws.  These forward-looking statements are subject to risks and uncertainties.  Actual results could differ materially from those projected due to various factors including, but not limited to, the risks associated with general economic and local real estate conditions, the company’s ability to meet its obligations on existing indebtedness or refinance existing indebtedness on favorable terms, the availability and cost of capital, the company’s ability to lease its properties, the company’s inability to collect rent due to the bankruptcy or insolvency of tenants or otherwise, and competition.  For a more detailed discussion of the factors that affect our operating results, interested parties should review the Tanger Factory Outlet Centers, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2008.

 
3
 

TANGER FACTORY OUTLET CENTERS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
   
                    Three Months Ended
  
   
                    March 31,
  
   
2009
    
2008
  
Revenues
                
 
Base rentals (a)
  
$
42,927
    
$
37,232
  
 
Percentage rentals
    
1,308
      
1,178
  
 
Expense reimbursements
    
19,219
      
17,478
  
 
Other income
    
1,704
      
1,388
  
     
 Total revenues
    
65,158
      
57,276
  
Expenses
                
 
Property operating
    
21,748
      
19,219
  
 
General and administrative
    
5,935
      
5,271
  
 
Depreciation and amortization (b)
    
20,397
      
15,583
  
     
Total expenses
    
48,080
      
40,073
  
Operating income
    
17,078
      
17,203
  
 
Interest expense (c)
    
11,210
      
10,199
  
Income before equity in earnings (loss) of unconsolidated joint
                
 
ventures and gain on fair value measurement of previously held
               
 
interest in acquired joint venture
    
5,868
      
7,004
  
Equity in earnings (loss) of unconsolidated joint ventures (d)
    
(897
)
    
394
  
Income from continuing operations
    
4,971
      
7,398
  
Gain on fair value measurement of previously held interest in acquired
                
 
joint venture (e)
    
31,497
      
---
  
Net income
    
36,468
      
7,398
  
Preferred share dividends
    
(1,406
)
    
(1,406
)
Non-controlling interest in operating partnership
    
(5,698
)
    
(981
)
Allocation to participating securities (f)
    
(437
)
    
(139
)
Net income available to common shareholders
  
$
28,927
    
$
4,872
  
                   
Basic earnings per common share available to common shareholders:
                
 
Income from continuing operations
  
$
.93
    
$
.16
  
 
Net income
    
.93
      
.16
  
             
Diluted earnings per common share available to common shareholders:
                
 
Income from continuing operations 
  
$
.92
    
$
.16
  
 
Net income
    
.92
      
.16
  
                 
(a)  
Includes straight-line rent and market rent adjustments of $699 and $683 for the three months ended March 31, 2009 and 2008, respectively.
(b)  
Includes accelerated deprecation and amortization of approximately $1.2 million for the three months ended March 31, 2009 as a result of the change in estimated useful life of the Hilton Head I, South Carolina center to three years based on our redevelopment plan for the center.  The accelerated depreciation and amortization reduced income from continuing operations and net income by approximately $.03 per share for the three months ended March 31, 2009.
(c)  
In accordance with FSP APB 14-1 “Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)”, the results of operations for all prior periods presented for which such instruments were outstanding have been restated.
(d)  
Includes Wisconsin Dells, Wisconsin property for the 2009 and 2008 periods which is operated by us through 50% ownership joint venture.  Includes Myrtle Beach, South Carolina Hwy 17 property for the 2008 period during which period it was operated by us through a 50% ownership joint venture.  We acquired the remaining 50% interest in January 2009.  Includes Deer Park, New York property for the 2009 period which is operated by us through a 33.3% ownership joint venture.  Includes our share of losses incurred by the Deer Park property, which opened during October 2008, totaling $1.1 million due to depreciation charges and leverage on the project.  However, we expect results to improve during the stabilization of the property in its first year of operation.
(e)  
Represents FAS 141R “Business Combinations”, gain on fair value measurement of our previously held interest in the Myrtle Beach Hwy 17 joint venture upon acquisition on January 5, 2009.
(f)  
In accordance with EITF 03-06-1 “Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities”, represents earnings allocated to unvested restricted share awards that contain non-forfeitable rights to dividends or dividend equivalents.



 
4
 


TANGER FACTORY OUTLET CENTERS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
(Unaudited)
                       
   
March 31,
    
December 31,
  
   
2009
    
2008
  
 ASSETS:
                
 
Rental property
                
 
Land
  
$
135,710
    
$
135,689
  
 
Building, improvement and fixtures
    
1,348,211
      
1,260,243
  
 
Construction in progress
    
4,805
      
3,823
  
     
1,488,726
      
1,399,755
  
 
Accumulated depreciation
    
(374,541
)
    
(359,301
)
 
Rental property, net
    
1,114,185
      
1,040,454
  
 
Cash and cash equivalents
    
3,101
      
4,977
  
 
Investments in unconsolidated joint ventures
    
9,773
      
9,496
  
 
Deferred charges, net
    
48,294
      
37,750
  
 
Other assets
    
34,010
      
29,248
  
 
Total assets
  
$
1,209,363
    
$
1,121,925
  
             
 LIABILITIES AND EQUITY
 Liabilities
                
   
Debt
                
 
Senior, unsecured notes (net of discounts of $8,367 and $9,136, respectively)
$
391,133
    
$
390,363
  
 
Mortgage loan, net of discount of $1,166 and $0, respectively)
    
34,634
      
---
  
 
Unsecured term loan
    
235,000
      
235,000
  
 
Unsecured lines of credit
    
188,400
      
161,500
  
   
Total debt
    
849,167
      
786,863
  
 
Construction trade payables
    
9,070
      
11,968
  
 
Accounts payable and accrued expenses
    
27,777
      
26,277
  
 
Other liabilities
    
33,868
      
30,914
  
     
Total liabilities
    
919,882
      
856,022
  
             
Commitments
                
Equity
            
Shareholder’s equity
                
 
Preferred shares, 7.5% Class C, liquidation preference $25 per share,
                
   
8,000,000 shares authorized, 3,000,000 shares issued and
                
   
outstanding at March 31, 2009 and December 31, 2008
    
75,000
      
75,000
  
 
Common shares, $.01 par value, 150,000,000 shares authorized,
                
   
31,888,401 and 31,667,501 shares issued and outstanding at
                
   
March 31, 2009 and December 31, 2008, respectively
    
319
      
317
  
 
Paid in capital
    
372,762
      
371,190
  
 
Distributions in excess of net income (a)
    
(184,349
)
    
(201,679
)
 
Accumulated other comprehensive loss
    
(8,533
)
    
(9,617
)
     
Total shareholders’ equity
    
255,199
      
235,211
  
Non-controlling interest in operating partnership (b)
    
34,282
      
30,692
  
     
Total equity
    
289,481
      
265,903
  
       
Total liabilities and equity
  
$
1,209,363
    
$
1,121,925
  
             

(a)  
Distributions in excess of net income as of December 31, 2008 includes a reduction of earnings of $5,144 that represents the cumulative effect adjustment of the implementation of FSP APB 14-1, ”Accounting for Convertible Debt Instruments that May be Settled in Cash Upon Conversion (Including Partial Cash Settlement)”.
(b)  
Represents a reclassification of non-controlling interest from prior presentation upon adoption of FAS 160 “Non-controlling Interests in Consolidated Financial Statements, an amendment of ARB No. 51”.

 
5
 


TANGER FACTORY OUTLET CENTERS, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
(in thousands, except per share, state and center information)
(Unaudited)

   
                    Three Months Ended
  
   
                    March 31,
  
   
2009
    
2008
  
FUNDS FROM OPERATIONS (a)
                
Net income
  
$
36,468
    
$
7,398
  
Adjusted for:
                
 
Depreciation and amortization uniquely significant to
                
   
real estate – wholly-owned
    
20,278
      
15,508
  
 
Depreciation and amortization uniquely significant to
                
   
real estate – unconsolidated joint ventures
    
1,166
      
652
  
 
Gain on fair value measurement of previously held interest in acquired
                
   
joint venture
    
(31,497
)
    
---
  
Funds from operations (FFO)
    
26,415
      
23,558
  
Preferred share dividends
    
(1,406
)
    
(1,406
)
Allocation to participating securities
    
(306
)
    
(246
)
Funds from operations available to common shareholders
    
24,703
      
21,906
  
Funds from operations available to common shareholders per share – diluted
  
$
.66
    
$
.59
  
                 
WEIGHTED AVERAGE SHARES
                
Basic weighted average common shares
    
31,269
      
30,979
  
Effect of exchangeable notes
    
---
      
92
  
Effect of outstanding options
    
81
      
169
  
Diluted weighted average common shares
                
 
(for earnings per share computations)
    
31,350
      
31,240
  
Convertible operating partnership units (b)
    
6,067
      
6,067
  
Diluted weighted average common share (for funds from operations per
            
 
share computations)
    
37,417
      
37,307
  
                 
OTHER INFORMATION
                
Gross leasable are open at end of period -
                
 
Wholly-owned
    
9,218
      
8,434
  
 
Partially-owned  -  unconsolidated
    
950
      
667
  
                 
Outlet centers in operations -
                
 
Wholly-owned
    
31
      
29
  
 
Partially-owned  -  unconsolidated
    
2
      
2
  
                 
States operated in at end of period (c)
    
21
      
21
  
Occupancy percentage at end of period (c) (d)
    
93.5%
      
95.2%
  


 
6
 


                                 
(a) FFO is a non-GAAP financial measure.  The most directly comparable GAAP measure is net income (loss), to which it is reconciled.  We believe that for a clear understanding of our operating results, FFO should be considered along with net income as presented elsewhere in this report.  FFO is presented because it is a widely accepted financial indicator used by certain investors and analysts to analyze and compare one equity REIT with another on the basis of operating performance.  FFO is generally defined as net income (loss), computed in accordance with generally accepted accounting principles, before extraordinary items and gains (losses) on sale or disposal of depreciable operating properties, plus depreciation and amortization uniquely significant to real estate and after adjustments for unconsolidated partnerships and joint ventures.  We caution that the calculation of FFO may vary from entity to entity and as such the presentation of FFO by us may not be comparable to other similarly titled measures of other reporting companies.  FFO does not represent net income or cash flow from operations as defined by accounting principles generally accepted in the United States of America and should not be considered an alternative to net income as an indication of operating performance or to cash flows from operations as a measure of liquidity.  FFO is not necessarily indicative of cash flows available to fund dividends to shareholders and other cash needs.
 
(b) The convertible operating partnership units (non-controlling interest in operating partnership) are not dilutive on earnings per share computed in accordance with generally accepted accounting principles.
 
(c) Excludes Wisconsin Dells, Wisconsin property for the 2009 and 2008 periods which is operated by us through 50% ownership joint venture.  Excludes Myrtle Beach, South Carolina Hwy 17 property for the 2008 period during which period it was operated by us through a 50% ownership joint venture.  We acquired the remaining 50% interest in January 2009.  Excludes Deer Park, New York property for the 2009 period which is operated by us through a 33.3% ownership joint venture.  The Deer Park property opened during October 2008.
 
(d) Excludes our wholly-owned, non-stabilized center in Washington, Pennsylvania for the 2009 period.
 
 
 
 
 
 
 
 
 
7
 EX-99.2 3 tfoc8k03312009ex99-2.htm EXHIBIT 99.2 tfoc8k03312009ex99-2.htm



Tanger Factory Outlet Centers, Inc.


Supplemental Operating and Financial Data

March 31, 2009







 
1
 

Notice





For a more detailed discussion of the factors that affect our operating results, interested parties should review the Tanger Factory Outlet Centers, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2008.


This Supplemental Operating and Financial Data is not an offer to sell or a solicitation to buy any securities of the Company.  Any offers to sell or solicitations to buy any securities of the Company shall be made only by means of a prospectus.



 
2
 

Table of Contents


Section

Portfolio Data:

 
Geographic Diversification
      
4
 
Property Summary – Occupancy at End of Each Period Shown
      
5
 
Portfolio Occupancy at the End of Each Period
      
6
 
Major Tenants
      
7
 
Lease Expirations as of March 31, 2009
      
8
 
Leasing Activity
      
9


Financial Data:

 
Consolidated Balance Sheets
      
10
 
Consolidated Statements of Operations
      
11
 
FFO and FAD Analysis
      
12
 
Unconsolidated Joint Venture Information
      
13
 
Debt Outstanding Summary
      
16
 
Future Scheduled Principal Payments
      
17
 
Senior Unsecured Notes Financial Covenants
      
17
         
Investor Information
      
18
     


 
3
 

Geographic Diversification


As of March 31, 2009
 
State
 
# of Centers
 
GLA
 
% of GLA
South Carolina
4
1,569,268
17%
Georgia
3
826,643
9%
New York
1
729,315
8%
Pennsylvania
2
625,677
7%
Texas
2
619,806
7%
Delaware
1
568,868
6%
Alabama
1
557,185
6%
Michigan
2
436,751
5%
Tennessee
1
419,038
4%
Missouri
1
302,992
3%
Utah
1
298,379
3%
Connecticut
1
291,051
3%
Louisiana
1
282,403
3%
Iowa
1
277,230
3%
Oregon
1
270,280
3%
Illinois
1
256,514
3%
New Hampshire
1
245,563
3%
Florida
1
198,950
2%
North Carolina
2
186,413
2%
California
1
171,300
2%
Maine
2
84,313
1%
Total (1)
31
9,217,939
100%
 
 
(1)  
Excludes one 264,929 square foot center in Wisconsin Dells, WI, of which Tanger owns 50% interest in through joint venture arrangements.  Also, excludes one 655,699 square foot shopping center and one 29,253 square foot warehouse in Deer Park, NY of which Tanger owns a 33.3% interest in through a joint venture arrangement.
 
 
4
Property Summary – Occupancy at End of Each Period Shown

Wholly-owned properties
 
 
Location
 
                  Total GLA
                 3/31/09
              %
               Occupied
             3/31/09
                        %
                     Occupied
                    12/31/08
                   %
Occupied
                      9/30/008
                         %
Occupied
                        6/30/08
                        %
  Occupied
                        3/31/08
Riverhead, NY
729,315
97%
98%
99%
99%
94%
Rehoboth, DE
568,868
97%
100%
100%
99%
97%
Foley, AL
557,185
91%
93%
94%
93%
94%
San Marcos, TX
442,006
97%
99%
99%
97%
96%
Myrtle Beach Hwy 501, SC
426,417
86%
92%
92%
96%
94%
Sevierville, TN
419,038
98%
100%
100%
100%
99%
Myrtle Beach Hwy 17, SC (2)
402,442
97%
100%
100%
99%
100%
Hilton Head, SC
388,094
85%
88%
88%
88%
87%
Washington, PA
370,525
82%
85%
86%
n/a
n/a
Charleston, SC
352,315
91%
97%
95%
95%
94%
Commerce II, GA
347,025
93%
96%
98%
98%
98%
Howell, MI
324,631
94%
98%
97%
97%
93%
Branson, MO
302,992
98%
100%
100%
98%
93%
Park City, UT
298,379
99%
100%
98%
92%
93%
Locust Grove, GA
293,868
95%
99%
100%
100%
96%
Westbrook, CT
291,051
94%
99%
99%
99%
98%
Gonzales, LA
282,403
99%
100%
100%
100%
99%
Williamsburg, IA
277,230
91%
99%
100%
99%
99%
Lincoln City, OR
270,280
94%
98%
100%
99%
98%
Tuscola, IL
256,514
78%
83%
80%
82%
84%
Lancaster, PA
255,152
97%
100%
100%
98%
100%
Tilton, NH
245,563
96%
100%
100%
100%
100%
Fort Myers, FL
198,950
95%
96%
92%
93%
98%
Commerce I, GA
185,750
58%
74%
72%
72%
76%
Terrell, TX
177,800
94%
100%
100%
100%
100%
Barstow, CA
171,300
100%
100%
100%
99%
100%
West Branch, MI
112,120
96%
100%
100%
100%
100%
Blowing Rock, NC
104,235
100%
100%
100%
100%
98%
Nags Head, NC
82,178
97%
97%
100%
100%
100%
Kittery I, ME
59,694
100%
100%
100%
100%
100%
Kittery II, ME
24,619
100%
100%
100%
100%
94%
Total
9,217,939
     94% (1)
   97% (1) (2)
   97% (1) (2)
   96% (2)
   95% (2)

Unconsolidated joint ventures
Deer Park, NY (3)
684,952
78%
78%
n/a
n/a
n/a
Wisconsin Dells, WI
264,929
97%
100%
99%
100%
100%


(1)  
Excludes the occupancy rate at our Washington, Pennsylvania center which opened during the third quarter of 2008 and had not yet stabilized.
(2)  
Excludes the occupancy rate at our Myrtle Beach Hwy 17, South Carolina center which was owned by an unconsolidated joint venture during those periods.  On January 5, 2009, we acquired the remaining 50% interest in the joint venture and the property became wholly-owned.
(3)  
Includes a 29,253 square foot warehouse adjacent to the shopping center.

 
5
 

Portfolio Occupancy at the End of Each Period (1)


03/09    12/08    09/08     06/08    03/08     12/07    09/07    06/07    03/07
94%    97%    97%     96%     95%     98%     97%   97%      95%

 

 
(1)  
Excludes one 264,929 square foot center in Wisconsin Dells, WI, of which Tanger owns 50% interest in through joint venture arrangements. Also, excludes one 655,699 square foot shopping center and one 29,253 square foot warehouse in Deer Park, NY of which Tanger owns a 33.3% interest in through a joint venture arrangement.

(2)  
Excludes the occupancy rate at our Myrtle Beach Hwy 17, South Carolina center which was owned by an unconsolidated joint venture during those periods.  On January 5, 2009, we acquired the remaining 50% interest in the joint venture and the property became wholly-owned

(3)  
Excludes the occupancy rate at our Charleston, South Carolina center which opened during the third quarter of 2006 and had not yet stabilized.

(4)  
Excludes the occupancy rate at our Washington, Pennsylvania center which opened during the third quarter of 2008 and had not yet stabilized.

6
Major Tenants (1)


Ten Largest Tenants As of March 31, 2009
 
Tenant
                                 # of
Stores
 
GLA
                                               % of
Total GLA
The Gap, Inc.
73
776,531
8.4%
Phillips-Van Heusen
90
431,598
4.7%
VF Outlet, Inc
33
308,298
3.3%
Nike
25
308,060
3.3%
Adidas
34
294,134
3.2%
Liz Claiborne
34
269,210
2.9%
Dress Barn, Inc.
38
259,851
2.8%
Carter’s
47
229,505
2.5%
Jones Retail Corporation
75
209,532
2.3%
Polo Ralph Lauren
23
197,669
2.2%
Total of All Listed Above
472
3,284,388
35.6%

 
(1)  
Excludes one 264,929 square foot center in Wisconsin Dells, WI, of which Tanger owns 50% interest in through joint venture arrangements.  Also, excludes one 655,699 square foot shopping center and one 29,253 square foot warehouse in Deer Park, NY of which Tanger owns a 33.3% interest in through a joint venture arrangement.


7
Lease Expirations as of March 31, 2009

 

Percentage of Total Gross Leasable Area (1)


2009     2010     2011     2012        2013    2014    2015    2016       2017       2018      2019+
6.00%    17.00%    18.00%    18.00%    18.00%    9.00%      2.00%      2.00%    3.00%    4.00%    3.00%


Percentage of Total Annualized Base Rent (1)



2009     2010     2011     2012        2013    2014    2015    2016       2017       2018      2019+
6.00%    16.00%    16.00%    17.00%    19.00%    8.00%      2.00%      3.00%    4.00%    5.00%    4.00%




(1)
Excludes one 264,929 square foot center in Wisconsin Dells, WI, of which Tanger owns 50% interest in through joint venture arrangements. Also, excludes one 655,699 square foot shopping center and one 29,253 square foot warehouse in Deer Park, NY of which Tanger owns a 33.3% interest in through a joint venture arrangement.

8
Leasing Activity (1)
 
 
03/31/09
 
06/30/09
 
09/30/09
 
12/31/09
 
Year to Date
               Prior
Year to Date
Re-tenanted Space:
            
    Number of leases
51
      
51
73
    Gross leasable area
188,153
      
188,153
279,014
    New initial base rent per square foot
$24.75
      
$24.75
$23.03
    Prior expiring base rent per square foot
$18.74
      
$18.74
$17.67
    Percent increase
32.0%
      
32.0%
30.4%
             
    New straight line base rent per square foot
$26.09
      
$26.09
$24.41
    Prior straight line base rent per square foot
$18.31
      
$18.31
$17.23
    Percent increase
42.4%
      
42.4%
41.7%
             
Renewed Space:
            
    Number of leases
162
      
162
166
    Gross leasable area
806,051
      
806,051
800,197
    New initial base rent per square foot
$18.05
      
$18.05
$19.37
    Prior expiring base rent per square foot
$16.20
      
$16.20
$16.94
    Percent increase
11.4%
      
11.4%
14.3%
             
   New straight line base rent per square foot
$18.42
      
$18.42
$20.04
    Prior straight line base rent per square foot
$16.08
      
$16.08
$16.99
    Percent increase
14.5%
      
14.5%
17.9%
             
Total Re-tenanted and Renewed Space:
            
    Number of leases
213
      
213
239
    Gross leasable area
994,204
      
994,204
1,079,211
    New initial base rent per square foot
$19.32
      
$19.32
$20.32
    Prior expiring base rent per square foot
$16.68
      
$16.68
$17.13
    Percent increase
15.8%
      
15.8%
18.6%
             
    New straight line base rent per square foot
$19.87
      
$19.87
$21.17
    Prior straight line base rent per square foot
$16.50
      
$16.50
$17.05
    Percent increase
20.4%
      
20.4%
24.1%



(1)  
Excludes one 264,929 square foot center in Wisconsin Dells, WI, of which Tanger owns 50% interest in through joint venture arrangements. Also, excludes one 655,699 square foot shopping center and one 29,253 square foot warehouse in Deer Park, NY of which Tanger owns a 33.3% interest in through a joint venture arrangement.
 
 
9
Consolidated Balance Sheets (dollars in thousands)
 
 
3/31/09
12/31/08
9/30/08
6/30/08
3/31/08
Assets
          
   Rental property
          
       Land
$135,710
$135,689
$135,688
$130,077
$130,077
       Buildings
1,348,211
1,260,243
1,233,906
1,130,536
1,127,956
       Construction in progress
4,805
3,823
16,377
90,614
53,173
   Total rental property
1,488,726
1,399,755
1,385,971
1,351,227
1,311,206
       Accumulated depreciation
(374,541)
(359,301)
(345,577)
(333,995)
(323,520)
   Total rental property – net
1,114,185
1,040,454
1,040,394
1,017,232
987,686
   Cash & cash equivalents
3,101
4,977
3,753
1,088
2,302
   Investments in unconsolidated joint ventures
9,773
9,496
12,184
11,703
9,225
   Deferred charges – net
48,294
37,750
39,644
41,593
42,056
   Other assets
34,010
29,248
28,811
28,097
31,698
Total assets
$1,209,363
$1,121,925
$1,124,786
$1,099,713
$1,072,967
Liabilities & equity
 
 
 
  Liabilities
 
     
 
    Debt
 
   
 
 
       Senior, unsecured notes, net of discount
$391,133
$390,363
$389,605
$388,858
$388,123
       Unsecured term loan
235,000
235,000
235,000
235,000
---
       Mortgages payable, including   discount/(premium)
34,634
---
---
---
172,121
       Unsecured lines of credit
      188,400
      161,500
      149,500
      128,300
      156,900
    Total debt
849,167
786,863
774,105
752,158
717,144
    Construction trade payables
9,070
11,968
22,840
28,393
23,780
    Accounts payable & accruals
27,777
26,277
30,789
22,453
24,629
   Other liabilities
33,868
30,914
15,784
12,378
29,574
  Total liabilities
919,882
856,022
843,518
815,382
795,127
Equity
 
 
 
 
 
  Shareholders’ equity
 
 
     
    Preferred shares
75,000
75,000
75,000
75,000
75,000
    Common shares
319
317
317
316
315
    Paid in capital
372,762
371,190
369,999
368,034
365,535
    Distributions in excess of net income
(184,349)
(201,679)
(197,140)
(193,441)
(180,795)
    Accum. other comprehensive income (loss)
(8,533)
(9,617)
(73)
725
(14,938)
  Total shareholders’ equity
255,199
235,211
248,103
250,634
245,117
  Non-controlling interest
       34,282
       30,692
       33,165
       33,697
       32,723
Total Equity
289,481
265,903
281,268
284,331
277,840
Total liabilities and equity
$1,209,363
$1,121,925
$1,124,786
$1,099,713
$1,072,967
 
10
Consolidated Statements of Operations (dollars and shares in thousands)

 
Three Months Ended
YTD
 
03/09
12/08
09/08
06/08
03/08
03/09
03/08
Revenues
              
   Base rentals
  $    42,927
  $    42,694
  $    40,519
  $    38,623
  $    37,232
  $  42,927
  $    37,232
   Percentage rentals
          1,308
          2,949
          1,811
          1,120
          1,178
        1,308
          1,178
   Expense reimbursements
        19,219
        20,557
        18,277
        15,692
        17,478
      19,219
        17,478
   Other income
          1,704
          2,137
          2,166
          1,570
          1,388
        1,704
          1,388
      Total revenues
        65,158
        68,337
        62,773
        57,005
        57,276
      65,158
        57,276
Expenses
              
   Property operating
        21,748
        21,139
        20,091
        17,525
        19,219
      21,748
        19,219
   General & administrative
          5,935
          5,099
          6,217
          5,677
          5,271
        5,935
          5,271
   Depreciation & amortization
        20,397
        16,736
        15,320
        14,690
        15,583
      20,397
        15,583
   Abandoned due diligence costs
              ---
          3,336
            587
              ---
               ---
             ---
              ---
      Total expenses
        48,080
        46,310
        42,215
        37,892
        40,073
      48,080
        40,073
Operating income
        17,078
        22,027
        20,558
        19,113
        17,203
      17,078
        17,203
   Interest expense
        11,210
        10,972
          9,811
      10,143
        10,199
      11,210
        10,199
   Loss on settlement of US treasury rate locks
---
---
---
     8,910
---
             ---
---
Income before equity in earnings (loss) of
   unconsolidated joint ventures and gain on
   fair value measurement of previously held
   interest in acquired joint venture
 
 
 
         5,868
 
 
 
        11,055
 
 
 
        10,747
 
 
 
               60
 
 
 
         7,004
 
 
 
        5,868
 
 
 
         7,004
Equity in earnings (loss) of unconsolidated
   joint ventures
 
           (897)
 
           (696)
 
             596
 
             558
 
            394
 
        (897)
 
            394
Income from continuing operations
          4,971
       10,359
        11,343
             618
         7,398
        4,971
         7,398
Gain on  fair value measurement of
   previously held interest in acquired joint
   venture
 
 
        31,497
 
 
               ---
 
 
             ---
 
 
             ---
 
 
             ---
 
 
      31,497
 
 
            ---
Net income
        36,468
        10,359
        11,343
             618
          7,398
      36,468
         7,398
Less applicable preferred share dividends
        (1,406)
        (1,406)
        (1,406)
        (1,407)
         (1,406)
      (1,406)
        (1,406)
Non-controlling interest
        (5,698)
        (1,459)
        (1,621)
             129
            (981)
      (5,698)
           (981)
Allocation to participating securities
           (437)
           (195)
           (195)
           (195)
            (139)
         (437)
           (139)
Net income (loss) available to common
   shareholders
 
$     28,927
 
$       7,299
 
$       8,121
 
$         (855)
 
$         4,872
 
$    28,927
 
$        4,872
Basic earnings per common share:
              
   Income (loss) from continuing operations
$        .93
$        .23
$        .26
$        (.03)
$        .16
$        .93
$           .16
   Net income (loss)
$        .93
$        .23
$        .26
$        (.03)
$        .16
$        .93
$           .16
Diluted earnings per common share:
              
   Income (loss) from continuing operations
$        .92
$        .23
$        .26
$        (.03)
$        .16
$        .92
$           .16
   Net income (loss)
$        .92
$        .23
$        .26
$        (.03)
$        .16
$        .92
$           .16
Weighted average common shares:
              
   Basic
      31,269
      31,160
      31,129
      31,068
      30,979
      31,269
       30,979
   Diluted
      31,350
      31,258
      31,739
      31,446
      31,240
      31,350
       31,240


 
11
 

FFO and FAD Analysis (dollars and shares in thousands)
 
Three Months Ended
YTD
 
      03/09
    12/08
    09/08
    06/08
   03/08
    03/09
    03/08
Funds from operations:
              
   Net income
$    36,468
$  10,359
$  11,343
$     618
$  7,398
$  36,468
$    7,398
   Adjusted for -
              
      Depreciation and amortization
        uniquely significant to real estate –
       wholly-owned
 
 
      20,278
 
 
    16,630
 
 
    15,219
 
 
    14,608
 
 
    15,508
 
 
    20,278
 
 
    15,508
      Depreciation and amortization
        uniquely significant to real estate –
        joint ventures
 
 
        1,166
 
 
      1,227
 
 
         635
 
 
         651
 
 
         652
 
 
      1,166
 
 
         652
      (Gain) on fair value measurement of
        previously held interest in
        acquired joint venture
 
 
     (31,497)
 
 
           --
 
 
           --
 
 
           --
 
 
           --
 
 
   (31,497)
 
 
           --
Funds from operations
      26,415
    28,216
    27,197
    15,877
    23,558
    26,415
    23,558
Preferred share dividends
       (1,406)
     (1,406)
     (1,406)
     (1,407)
     (1,406)
     (1,406)
     (1,406)
Allocation to participating securities
          (306)
        (361)
        (349)
        (197)
        (246)
        (306)
        (246)
Funds from operations available to
       common shareholders
 
$     24,703
 
$   26,449
 
$  25,442
 
$  14,273
 
$   21,906
 
$  24,703
 
$  21,906
               
Funds from operations per share
          $.66
         $.71
        $.67
    $   .38
    $    .59
    $    .66
   $     .59
Funds available for distribution to
   common shareholders:
              
   Funds from operations
$     24,703
$    26,449
$  25,442
$  14,273
$  21,906
$  24,703
$  21,906
   Adjusted for -
              
      Corporate depreciation
          excluded above
 
           119
 
          106
 
         101
 
          82
 
          75
 
        119
 
        75
      Amortization of finance costs
           465
          474
         444
        352
        361
        465
         361
      Amortization of net debt discount
           premium
 
        1,070
 
          758
 
        747
 
         297
 
        117
 
     1,070
 
        117
      Loss on termination of US treasury
           lock derivatives
 
            --
 
--
 
--
 
      8,910
 
--
 
--
 
--
      Amortization of share compensation
       1,297
       1,368
      1,404
      1,396
      1,224
      1,297
      1,224
      Straight line rent adjustment
        (777)
         (499)
       (822)
    (1,085)
       (789)
       (777)
       (789)
      Market rent adjustment
            78
         (128)
       (135)
       (198)
        105
          78
        105
      2nd generation tenant allowances
      (2,371)
       (3,042)
     (3,088)
    (2,701)
    (4,177)
    (2,371)
    (4,177)
      Capital improvements
      (2,761)
       (6,736)
   (12,062)
    (9,500)
    (2,549)
    (2,761)
    (2,549)
Funds available for distribution
 $   21,823
 $    18,750
 $ 12,031
 $ 11,826
 $ 16,273
 $ 21,823
 $ 16,273
Funds available for distribution
   per share
 
    $     .58
 
    $       .50
 
    $   .32
 
    $    .31
 
    $    .44
 
    $   .58
 
    $   .44
Dividends paid per share
    $     .38
    $       .38
    $   .38
    $    .38
    $    .36
    $   .38
    $   .36
               
FFO payout ratio
            58%
    54%
          57%
         100%
    61%
         58%
          61%
FAD payout ratio
            66%
    76%
        119%
         123%
    82%
         66%
          82%
Diluted weighted average common shs.
      37,417
       37,324
   37,806
    37,512
      37,307
   37,417
   37,307


 
12
 

Unconsolidated Joint Venture Information – All
Summary Balance Sheets (dollars in thousands)
 
 
 
3/31/09
 
 
12/31/08
 
 
9/30/08
 
 
6/30/08
 
 
3/31/08
  
              Tanger’s
           Share as of
             3/31/09
Assets
              
   Investment properties at cost – net
$288,951
$323,546
$72,118
$73,033
$70,541
  
$101,947
   Construction in progress
---
---
226,031
181,246
134,756
  
---
   Cash and cash equivalents
13,195
5,359
4,104
3,896
2,708
  
4,823
   Deferred charges – net
6,307
7,025
6,041
6,184
2,157
  
2,185
   Other assets
4,399
6,324
7,853
7,894
8,613
  
1,565
Total assets
$312,852
$342,254
$316,147
$272,253
$218,775
  
$110,520
               
Liabilities & Owners’ Equity
              
    Mortgage payable
$288,169
$303,419
$259,789
$215,028
$173,249
  
$100,265
    Construction trade payables
3,356
13,641
26,750
28,129
20,736
  
1,152
    Accounts payable & other liabilities
6,998
9,479
6,845
7,117
9,281
  
2,441
Total liabilities
298,523
326,539
293,384
250,274
203,266
  
103,858
Owners’ equity
14,329
15,715
22,763
21,979
15,509
  
6,662
Total liabilities & owners’ equity
$312,852
$342,254
$316,147
$272,253
$218,775
  
$110,520

Summary Statements of Operations (dollars in thousands)

 
Three Months Ended
YTD
 
03/09
12/08
09/08
06/08
03/08
03/09
03/08
Revenues
$8,524
$10,573
$5,582
$5,031
$4,757
$8,524
$4,757
Expenses
              
   Property operating
4,247
6,679
2,128
1,720
1,802
4,247
1,802
   General & administrative
189
403
90
79
19
189
19
   Depreciation & amortization
3,174
3,022
1,302
1,344
1,345
3,174
1,345
     Total expenses
7,610
10,104
3,520
3,143
3,166
7,610
3,166
Operating income
914
469
2,062
1,888
1,591
914
1,591
   Interest expense
3,731
3,414
932
820
840
3,731
840
Net income (loss)
$(2,817)
$(2,945)
$1,130
$1,068
$751
$(2,817)
$751
Tanger’s share of:
              
       Total revenues less property
       operating and general &
       administrative expenses (“NOI”)
 
 
$   1,534
 
 
$1,808
 
 
$1,692
 
 
$1,617
 
 
$1,466
 
 
$   1,534
 
 
$1,466
       Net income
$   (897)
$(696)
$596
$558
$394
$   (897)
$394
       Depreciation (real estate related)
$   1,166
$1,227
$635
$651
$652
$   1,166
$652

 
13
 

 Unconsolidated Joint Venture Information – Wisconsin Dells
Summary Balance Sheets (dollars in thousands)
 
 
 
03/31/09
 
 
12/31/08
 
 
09/30/08
 
 
06/30/08
 
 
3/31/08
  
                 Tanger’s
                Share as of
                 03/31/09
Assets
              
   Investment properties at cost - net
$33,718
$34,068
$34,426
$34,965
$35,556
  
$16,859
   Cash and cash equivalents
2,436
2,352
1,210
676
277
  
1,218
   Deferred charges – net
493
528
575
640
706
  
247
   Other assets
589
533
582
731
860
  
295
Total assets
$37,236
$37,481
$36,793
$37,012
$37,399
  
$18,619
               
Liabilities & Owners’ Equity
              
    Mortgage payable
$25,250
$25,250
$25,250
$25,250
$25,250
  
$12,625
    Construction trade payables
199
199
--
--
158
  
100
    Accounts payable & other liabilities
654
816
725
727
591
  
327
Total liabilities
26,103
26,265
25,975
25,977
25,999
  
13,052
Owners’ equity
11,133
11,216
10,818
11,035
11,400
  
5,567
Total liabilities & owners’ equity
$37,236
$37,481
$36,793
$37,012
$37,399
  
$18,619

Summary Statements of Operations (dollars in thousands)

 
Three Months Ended
YTD
 
03/09
12/08
09/08
06/08
03/08
03/09
03/08
Revenues
$1,771
$2,644
$1,903
$1,795
$1,848
$1,771
$1,848
Expenses
              
   Property operating
685
694
582
615
712
685
712
   General & administrative
3
6
2
6
3
3
3
   Depreciation & amortization
613
615
610
607
606
613
606
     Total expenses
1,301
1,315
1,194
1,228
1,321
1,301
1,321
Operating income
470
1,329
709
567
527
470
527
   Interest expense
134
272
266
271
339
134
339
Net income
$  336
$1,057
$443
$296
$188
$  336
$188
Tanger’s share of:
              
       Total revenues less property
       operating and general &
       administrative expenses (“NOI”)
 
 
$541
 
 
$971
 
 
$659
 
 
$587
 
 
$567
 
 
$541
 
 
$567
       Net income
$177
$538
$232
$158
$105
$177
$105
       Depreciation (real estate related)
      $297
      $296
      $295
      $294
      $292
    $297
      $292

 
14
 

Unconsolidated Joint Venture Information – Deer Park
Summary Balance Sheets (dollars in thousands)
 
 
 
03/31/09
 
 
12/31/08
 
 
09/30/08
 
 
06/30/08
 
 
03/31/08
  
                 Tanger’s
                 Share as of
                  03/31/09
Assets
              
   Investment properties at cost - net
$   255,174
$  255,885
$   3,443
$   3,424
$        ---
  
$  85,058
   Construction in progress
---
---
226,031
181,246
134,756
  
---
   Cash and cash equivalents
10,645
2,093
1,141
1,851
1,395
  
3,548
   Deferred charges – net
5,814
5,895
4,822
4,900
727
  
1,938
   Other assets
3,810
3,632
5,039
4,828
5,489
  
1,270
Total assets
$275,443
$267,505
$240,476
$196,249
$142,367
  
 $ 91,814
               
Liabilities & Owners’ Equity
              
    Mortgage payable
$262,919
$242,369
$198,739
$153,978
$112,199
  
$ 87,640
    Construction trade payables
3,157
13,182
25,859
27,185
19,846
  
1,052
    Accounts payable & other liabilities
6,344
6,414
4,343
4,764
6,418
  
2,114
Total liabilities
272,420
261,965
228,941
185,927
138,463
  
90,806
Owners’ equity
3,023
5,540
11,535
10,322
3,904
  
1,008
Total liabilities & owners’ equity
$275,443
$267,505
$240,476
$196,249
$142,367
  
$  91,814

Summary Statements of Operations (dollars in thousands)

 
Three Months Ended
YTD
 
03/09
12/08
09/08
06/08
03/08
03/09
03/08
Revenues
$6,753
$4,855
$450
$42
$21
$6,753
$21
Expenses
              
   Property operating
3,562
4,852
424
4
--
3,562
--
   General & administrative
186
376
84
46
9
186
9
   Depreciation & amortization
2,539
1,652
20
4
--
2,539
--
     Total expenses
6,287
6,880
528
54
9
6,287
9
Operating income
466
(2,025)
(78)
(12)
12
466
12
   Interest expense
3,597
2,588
30
6
--
3,597
--
Net income (loss)
$(3,131)
$(4,613)
$(108)
$(18)
$12
$(3,131)
$12
Tanger’s share of:
              
       Total revenues less property
       operating and general &
       administrative expenses (“NOI”)
 
 
$   1,002
 
 
$   (123)
 
 
$(18)
 
 
$(2)
 
 
$4
 
 
$   1,002
 
 
$4
       Net income (loss)
$(1,065)
$(1,540)
$(36)
$(6)
$4
$(1,065)
$4
       Depreciation (real estate related)
$     868
$     554
       $   7
       $   1
          $--
$     868
          $--

 
15
 

Debt Outstanding Summary (dollars in thousands)

As of March 31, 2009
 
Principal
Balance 
Interest
Rate
Maturity
Date
Secured debt
      
   Myrtle Beach Hwy 17 mortgage (1)
$  35,800
Libor + 1.40%
4/7/10
Unsecured debt
      
   Unsecured term loan credit facility (2)
235,000
Libor + 1.60%
6/10/11
   Unsecured credit facilities (3)
188,400
Libor + 0.60 – 0.75%
06/30/11
   2015 Senior unsecured notes
250,000
6.15%
11/15/15
   2026 Senior unsecured exchangeable notes (4)
149,500
3.75%
8/15/26
Net debt discounts
(9,533)
    
Total consolidated debt
$849,167
    
Tanger’s share of unconsolidated JV debt:
      
   Wisconsin Dells
12,625
Libor + 1.30%
02/24/10
Deer Park (5)
87,640
Libor + 1.375 – 3.50%
5/17/11
Total Tanger’s share of unconsolidated JV debt
$100,265
    
(1)  
In January 2009, we acquired the remaining 50% interest in the Myrtle Beach Hwy 17 joint venture, thus assuming the existing mortgage on the property.  In March 2005, the joint venture entered into an interest rate swap agreement for a notional amount of $35.0 million.  The purpose of the swap was to fix the interest rate on a portion of the $35.8 million outstanding mortgage completed in April 2005.  The swap fixed the one month LIBOR rate at 4.59%.  This swap, combined with the current spread of 140 basis points on the mortgage, fixes the interest on $35.0 million of variable rate debt at 5.99% until March 15, 2010.
(2)  
In July 2008, we entered into an interest rate swap agreement for a notional amount of $118.0 million.  The purpose of the swap was to fix the interest rate on a portion of the $235.0 million outstanding under the term loan facility completed in June 2008.  The swap fixed the one month LIBOR rate at 3.605%.  This swap, combined with the current spread of 160 basis points on the term loan facility, fixes our interest rate on $118.0 million of variable rate debt at 5.205% until April 1, 2011.  In September 2008, we entered into an additional interest rate swap agreement for a notional amount of $117.0 million.  The purpose of the swap was to fix the interest rate on the remaining portion of the $235.0 million outstanding under the term loan facility completed in June 2008.  The swap fixed the one month LIBOR rate at 3.700%.  This swap combined with the current spread of 160 basis points on the term loan facility fixes our interest rate on $117.0 million of variable rate debt at 5.300% until April 1, 2011.
(3)  
The company has six lines of credit with a borrowing capacity totaling $325.0 million, of which $25.0 million expires June 30, 2009, $260.0 million expires on June 30, 2011 and $40.0 million expires on August 30, 2011.
(4)  
On January 1, 2009, we adopted the provisions of FSP APB 14-1 “Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)”, which require us to bifurcate the notes into debt and equity components based on the fair value of the notes independent of the conversion feature as of the date of issuance in August 2006.  As a result of this adoption we recorded an initial debt discount of $15.0 million and the notes now have an effective interest rate of 6.11%.  FSP APB 14-1 was applied using retrospective treatment which means that prior periods have been restated.  As of March 31, 2009, the debt discount had a recorded value of $7.7 million.
(5)  
In May 2007, the joint venture entered into a four-year, interest-only construction loan facility with a one-year maturity extension option.  The facility includes a senior loan, with an interest rate of LIBOR plus 137.5 basis points, and a mezzanine loan, with an interest rate of LIBOR plus 350 basis points.   As of March 31, 2009, the outstanding principle balances of the senior and mezzanine loans were $245.6 million and $15.0 million, respectively, and $23.4 million was available for funding of additional construction draw requests under the senior loan facility.  In June 2007, the joint venture entered into two interest rate swap agreements, the purpose of which was to fix the interest rate on the senior loan.  The first swap was for a notional amount of $49.0 million and fixed the one month LIBOR rate at 5.47%.  This swap, combined with the spread of 137.5 basis points, fixes the joint venture’s interest rate on $49.0 million of the variable rate debt at 6.845% until June 1, 2009.  The second swap fixed the one month LIBOR rate at 6.715% through June 1, 2009.  The notional amount of this swap is $121.0 million.  The escalation schedule was based on the projected outstanding balances of the senior loan.  In June 2008, the joint venture entered into an interest-only mortgage loan agreement with an interest rate of LIBOR plus 185 basis points and a maturity of May 17, 2011.  As of March 31, 2009, the outstanding principle balance under this mortgage was $2.3 million.

 
16
 

Future Scheduled Principal Payments (dollars in thousands)

As of March 31, 2009
 
 
Year
Tanger   
Consolidated
Payments 
Tanger’s Share  
of Unconsolidated
JV Payments    
Total     
Scheduled
Payments 
2009
$         --
$          --
$          --
2010
35,800
12,625
48,425
2011
423,400
87,640
511,040
2012
--
--
--
2013
--
--
--
2014
--
--
--
2015
250,000
  
250,000
2016
--
--
--
2017
--
--
--
2018 & thereafter
(1) 149,500
--
149,500
 
$858,700
$100,265
$958,965
Net Discount on Debt
 (9,533)
--
(9,533)
 
$849,167
$100,265
$949,432


Senior Unsecured Notes Financial Covenants (2)

As of March 31, 2009
 
Required
Actual
Compliance
Total Consolidated Debt to Adjusted Total Assets
60%
  53%
Yes
Total Secured Debt to Adjusted Total Assets
40%
  2%
Yes
Total Unencumbered Assets to Unsecured Debt
135%
186%
Yes
Consolidated Income Available for Debt Service to                        
Annual Debt Service Charge
 
2.00
 
3.65
 
Yes
(1)  
Represents our exchangeable, senior unsecured notes issued in August 2006.  On and after August 18, 2011, holders may exchange their notes for cash in an amount equal to the lesser of the exchange value and the aggregate principal amount of the notes to be exchanged, and, at our option, Company common shares, cash or a combination thereof for any excess.  Note holders may exchange their notes prior to August 18, 2011 only upon the occurrence of specified events.  In addition, on August 18, 2011, August 15, 2016 or August 15, 2021, note holders may require us to repurchase the notes for an amount equal to the principal amount of the notes plus any accrued and unpaid interest thereon.
(2)  
For a complete listing of all Debt Covenants related to the Company’s Senior Unsecured Notes, as well as definitions of the above terms, please refer to the Company’s filings with the Securities and Exchange Commission..
 
 
17
Investor Information


Tanger Outlet Centers welcomes any questions or comments from shareholders, analysts, investment managers, media and prospective investors.  Please address all inquiries to our Investor Relations Department.


Tanger Factory Outlet Centers, Inc.
Investor Relations
Phone:  (336) 292-6825
Fax:      (336) 297-0931
e-mail:   tangermail@tangeroutlet.com
Mail:     Tanger Factory Outlet Centers, Inc.
              3200 Northline Avenue
              Suite 360
              Greensboro, NC  27408
 
18
 
 -----END PRIVACY-ENHANCED MESSAGE-----