SKT Tanger Inc

GREENSBORO, N.C., April 1, 2019 /PRNewswire/ -- This press release corrects a prior version published on April 1, 2019 (the "Prior Version"). This press release includes the corrected expected net accretive effect on 2019 net income of approximately $.40 per share, as opposed to $.50 per share reflected in the Prior Version.

The corrected release reads:

TANGER OUTLETS SELLS FOUR NON-CORE OUTLET CENTERS

Disposition Improves Key Portfolio Operating Metrics
Generates $131 Million of Gross Proceeds
Records Book Gain of Approximately $44 Million

Greensboro, N.C. – April 1, 2019: Tanger Factory Outlet Centers, Inc. (NYSE: SKT) announced today that it has closed on the sale of four non-core outlet centers for total gross proceeds of $130.5 million.  The four properties are located in Nags Head, North Carolina; Ocean City, Maryland; Park City, Utah; and Williamsburg, Iowa and represent 6.8% of the Company's consolidated portfolio square footage and approximately 5.1% of its forecasted 2019 portfolio net operating income ("Portfolio NOI").   This transaction is consistent with the Company's long-standing history of financial stewardship and strategic portfolio management.  Since December 2014, Tanger has now sold 13 assets generating gross proceeds of $402 million.

"By completing these asset sales, we are strengthening the overall quality, reducing the average age, and improving the longer-term growth profile of the portfolio.  We believe the benefits of these dispositions over time will more than offset the expected short-term earnings dilution, given that these assets are not expected to produce the long-term growth in cash flow that we anticipate from our core portfolio.  Our dividend remains well-covered even with the sale of these assets," said Steven B. Tanger, Chief Executive Officer.

The key performance metrics for the sold assets were below those of Tanger's overall portfolio, as follows:

The purchase price represents a 12.6% blended capitalization rate on the Company's forecasted 2019 Portfolio NOI.  Initially, Tanger expects to use the $128.7 million of net proceeds from the sale of these unencumbered assets to repay balances under its lines of credit.  Ultimately, the Company intends to allocate the proceeds between two of its key capital allocation priorities – opportunistically repurchasing its common shares as market conditions warrant and reducing outstanding debt balances to maintain a strong and flexible balance sheet.

Tanger expects to record a gain of approximately $44 million during the first quarter of 2019.  The Company has elected not to defer any taxable gain on this transaction and currently does not expect a special dividend to be necessary during 2019. 

Assuming all proceeds are used to reduce debt, Tanger expects a net accretive effect on 2019 net income of approximately $0.40 per share, which reflects the expected gain on the transaction and the impact of the use of proceeds, partially offset by the loss of nine months of earnings from the properties sold.  The effect on 2019 funds from operations ("FFO"), which is not impacted by the gain or depreciation expense, is expected to be a reduction of approximately $0.09 per share.  The transaction is not expected to have a significant impact on Tanger's 2019 same center net operating income trend.

FFO and Portfolio NOI are widely accepted supplemental non-GAAP measures used in the real estate industry to measure and compare the operating performance of real estate companies. 

About Tanger Factory Outlet Centers

Tanger Factory Outlet Centers, Inc. (NYSE: SKT), is a publicly-traded REIT headquartered in Greensboro, North Carolina that presently operates and owns, or has an ownership interest in, a portfolio of 40 upscale outlet shopping centers. Tanger's operating properties are located in 20 states coast to coast and in Canada, totaling approximately 14.4 million square feet, leased to over 2,900 stores which are operated by more than 500 different brand name companies. The Company has more than 38 years of experience in the outlet industry. Tanger Outlet Centers continue to attract more than 181 million shoppers annually. For more information on Tanger Outlet Centers, call 1-800-4TANGER or visit the Company's website at www.tangeroutlets.com.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of federal securities laws.  These statements include, but are not limited to, expectations regarding:  the anticipated effects of the asset sales described above, including on our future financial results and dividends; the expected benefits from such sales; our intentions regarding share repurchases and debt reduction; our anticipated 2019 financial results; the anticipated use of proceeds from the asset sales; the expected strength of our portfolio; expected dividend coverage; 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; risk associated with developing or expanding outlet centers; lack of liquidity for real estate investments; adverse changes in governmental laws and regulations; the Company's ability to meet its obligations on existing indebtedness, reduce variable rate debt or refinance existing indebtedness on favorable terms; the availability and cost of capital; the valuation of marketable securities and other investments; increases in operating costs; whether the Company's regular evaluation of acquisition and disposition opportunities results in any consummated transactions, and whether or not any such consummated transaction results in an increase or decrease in liquidity, net income, funds from operations or adjusted funds from operations; whether projects in our pipeline convert into successful developments; the Company's ability to lease its properties; the impact of environmental regulation; possible terrorist activity or other threats to public safety; the Company's ability to implement its plans and strategies for joint venture properties that it does not fully control; the reduction in the Company's income in the event of multiple lease terminations by tenants or a failure by multiple tenants to occupy their premises in a shopping center; impairment charges; the ability of tenants to continue paying their rent obligations due to bankruptcy, insolvency or a general downturn in their business; the results of operations of our retailers; adverse weather conditions, including hurricanes, and other natural disasters; the Company's ability to pay dividends at current levels; any failure by the Company to qualify as a REIT; tax reform; competition; lack of or insufficient insurance coverage; and our ability to attract and retain key personnel.  For a more detailed discussion of the important factors that affect our operating results, interested parties should review "Risk Factors" contained in the Tanger Factory Outlet Centers, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2018 or the Company's other filings with the Securities and Exchange Commission.

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SOURCE Tanger Factory Outlet Centers, Inc.