As a result of the deal, the total amount of square footage in Tanger's portfolio will increase from 4.9 million sf to 8.2 million sf. Officials at locally owned Tanger and New York City-based Blackstone expect the deal to close by October.
The outlets are in Rehoboth, DE; Riviera Centre-Foley, AL; Myrtle Beach, SC; Park City, UT; Hilton Head, SC; Lakes Region-Tilton, NH; Lincoln City, OR; Westbrook, CT; and Tuscola, IL. Tanger, which currently leases and manages the centers under its company, has a number of expansion opportunities at the properties, says Steven Tanger, the company's president and COO, during a conference call.
Tanger executives said during the call that the transaction will have a cap rate of about 8.5% and that it should be accretive to the company's FFO by 7% to 8%. Since the company has managed the nine outlets, sales per-sf have jumped from $280 to $295, and occupancy rates have risen from 93% to 94%, Tanger says. "We are still in the process of doing a number of things to continue to add value," he says.
Tanger has two expansions underway in its portfolio. The company is adding 46,400 sf to its center in Locust Grove, GA, as well as 21,000 sf to its property in Foley.
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