Tanger Announces $125,000,000 Share Repurchase Plan

GREENSBORO, N.C., May 19, 2017 /PRNewswire/ -- Tanger Factory Outlet Centers, Inc. (NYSE: SKT) ("Tanger" or the "Company") announced today the authorization of a $125 million share repurchase plan and the sale of Tanger's outlet center located in Westbrook, Connecticut.      

Today the Company's Board of Directors authorized the repurchase of up to $125 million of Tanger's outstanding common shares over the next 24 months as market conditions warrant.  Repurchases may be made through open market, privately-negotiated, structured or derivative transactions (including accelerated stock repurchase transactions), or other methods of acquiring shares. The Company intends to structure open market purchases to occur within pricing and volume requirements of Rule 10b-18.  The Company may, from time to time, enter into Rule 10b5-1 plans to facilitate repurchase of its shares under this authorization.

In keeping with the Company's long-standing practice of pruning its portfolio and recycling capital, Tanger closed on the sale of its Westbrook, Connecticut center on May 17, 2017 to a private real estate developer and operator for $40 million, which represents a capitalization rate of approximately 10.0% on forward property level net operating income excluding lease termination fees and non-cash adjustments and net of property management fees.  This compares favorably to four similar, but more productive, non-core assets the Company sold in 2015 at an average 10.4% cap rate.  The 290,000 square foot Westbrook center was 90% occupied at March 31, 2017 and was the least productive asset in Tanger's consolidated portfolio, having generated average tenant sales 44% below the Company's consolidated portfolio per square foot average for the trailing twelve months ended March 31, 2017. 

Tanger expects to record a gain of approximately $6.6 million on the sale of the Westbrook outlet center during the second quarter of 2017 and has elected not to defer any taxable gain on this transaction, which is currently not expected to have a significant impact on the Company's 2017 taxable income.  Tanger intends to use the net proceeds from the sale of this unencumbered asset to fund purchases under the newly authorized share repurchase plan as soon as possible, based on market conditions.

"We believe that Tanger shares are trading at a significant discount to the value of our high-quality portfolio of assets.  We have always actively managed our assets with the intent of maintaining a strong portfolio and good financial stewardship,"  said Steven B. Tanger, President and Chief Executive Officer.  "At the current trading levels, funding share repurchases with the proceeds from the sale of this 22-year-old non-core center provides us the opportunity to demonstrate confidence in our business while largely offsetting the future lost Westbrook net operating income and without compromising our fortress balance sheet," he added. 

Tanger expects a net accretive effect on 2017 net income per share of approximately $0.04, which reflects the expected gain on the Westbrook transaction, partially offset by the loss of seven and a half months of net operating income from the Westbrook property.  The dilutive effect on 2017 funds from operations ("FFO") is expected to be approximately $0.025 per share.  The Westbrook transaction is not expected to have a significant impact on Tanger's 2017 same center net operating income ("Same Center NOI") growth.  The impact of the share repurchase plan is contingent upon the quantity and timing of shares repurchased as well as the weighted average purchase price of shares repurchased.

FFO and Same Center NOI are widely accepted supplemental non-GAAP financial measures used in the real estate industry to measure and compare the operating performance of real estate companies.  Refer to the Company's most recent Form 10-Q filed with the Securities and Exchange Commission on May 2, 2017 for complete definitions and reconciliations containing adjustments from GAAP net income to FFO and Same Center NOI.

About Tanger Factory Outlet Centers, Inc.
Tanger Factory Outlet Centers, Inc. is a publicly-traded REIT headquartered in Greensboro, North Carolina that presently operates and owns, or has an ownership interest in, a portfolio of 43 upscale outlet shopping centers in 22 states coast to coast and in Canada, totaling approximately 14.8 million square feet leased to over 3,100 stores operated by more than 500 different brand name companies. With over 36 years of experience in the outlet industry and one additional center currently under construction, Tanger Outlet Centers continue to attract more than 185 million shoppers annually.  For more information on Tanger Outlet Centers, call 1-800-4TANGER or visit the Company's web site at www.tangeroutlets.com.

This news release contains forward-looking statements within the meaning of federal securities laws. These statements include, but are not limited to, expectations regarding: share repurchases and effects of the share repurchase program; 2017 financial results; forward net operating income; the impact of the asset sale on net income per share, funds from operations, net operating income, same center net operating income, and taxable income; use of proceeds from the asset sale; expected strength of our balance sheet; as well as other statements regarding plans, forecasts, estimates, expectations, intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts.

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 real estate conditions.  For a more detailed discussion of the important factors that affect our operating results, interested parties should review "Risk Factors" contained in the the Tanger Factory Outlet Centers, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2016.

SOURCE Tanger Factory Outlet Centers, Inc.

Related Links

http://www.tangeroutlet.com