Tanger (SKT) Nareit REITweek: 2024 Investor Conference summary

Consumer trends and tenant demand

• Consumers are seeking value and entertainment, driving traffic to outlet centers over traditional malls.

• Enhanced amenities, improved food and beverage options, and loyalty programs are used to attract and retain shoppers.

• New brand partnerships, such as Sephora's first outlet locations, are expanding the tenant mix and drawing new customer segments.

• Loyalty programs have been digitized, offering both free and paid tiers with stackable discounts and data benefits for retailers.

• Outlet centers serve as consolidation points for excess inventory, helping brands maintain margins in full-price locations.

Portfolio development and expansion

• The Nashville center opened at over 96.5% occupancy, with 20% dedicated to food and beverage, reflecting a shift in tenant mix.

• Peripheral land is being monetized with new uses like restaurants and entertainment, extending customer visits and catchment areas.

• Expansion includes partnerships with brands like Shake Shack and Texas Roadhouse, and entertainment venues such as Dave & Buster's and Topgolf.

• Portfolio expansion includes new developments in Nashville, acquisitions in Asheville and Huntsville, and a first open-air lifestyle center, targeting high-growth, tourist-driven markets.

• External growth leverages acquisitions, joint ventures, and adjacent retail/land opportunities, with a focus on open-air formats and leveraging operational expertise.

Portfolio and operational performance

• Operates 40 properties totaling 15.6M square feet, with 95% open-air centers and 91% of outlet space in top tourist or major metro areas.

• Maintains high occupancy rates (96.5% overall, 97.1% same center), with nine consecutive quarters of positive rent spreads and strong tenant sales per square foot ($437).

• Tenant mix is diverse, with top brands and new/expanded offerings, and upcoming lease expirations present opportunities for re-leasing and rent growth.

• Portfolio benefits from demographic trends, including above-average population and job growth, tourism, and flexible work patterns.

• Recent acquisitions and developments in Nashville, Asheville, and Huntsville are positioned in markets with strong economic, tourism, and residential growth.