Q2 2024 Tanger Inc Earnings Call

Ashley Curtis: Good morning, I'm Ashley Curtis, Assistant Vice President of Investor Relations, and I would like to welcome you to Tanger Inc.'s second quarter 2024 conference call. Yesterday evening, we issued our earnings release as well as our supplemental information package and investor presentation. This information is available on our IR website, investors.tanger.com. Please note this call may contain forward-looking statements that are subject to numerous risks and uncertainties, and actual results can differ materially from those projected.

Good morning, and Ashley Curtis Assistant Vice President of Investor Relations and I would like to welcome you to Tanger Inc's second quarter 'twenty 'twenty four conference call yesterday evening, we issued our earnings release as well as our supplemental information package and Investor presentation. This information is available on our IR web.

Ashley Curtis: I'm Ashley Curtis, Assistant Vice President of Investor Relations, and I would like to welcome you to Tanger Inc.'s second quarter 2024 conference call. Yesterday evening, we issued our earnings release, as well as our supplemental information package and investor presentation. This information is available on our IR website, investors.tanger.com.

Ashley Curtis: We direct you to our filings with the Securities and Exchange Commission for a detailed discussion of these risks and uncertainties. During the call, we will also discuss non-GAAP financial measures as defined by SEC Regulation G. Reconciliations of these non-GAAP measures to the most directly comparable GAAP financial measures are included in our earnings release and in our supplemental information. This call is being recorded for rebroadcast for a period of time in the future. As such, it is important to note that management's comments include time-sensitive information that may only be accurate as of today's date, August 2, 2024. At this time, all participants are in a listen-only mode.

REIT investors that Tanger Dot com.

Ashley Curtis: Please note this call may contain forward-looking statements that are subject to numerous risks and uncertainties, and actual results can differ materially from those projected. We direct you to our guidelines with the Securities and Exchange Commission for a detailed discussion of these risks and uncertainties. During the call, we will also discuss non-GAAP financial measures defined by SEC Regulation G. Reconciliation of these non-GAAP measures to the most directly comparable GAAP financial measures is included in our earnings release and in our supplemental information. This call is being recorded for rebroadcast for a period of time in the future.

Speaker Change: Please note. This call may contain forward looking statements that are subject to numerous risks and uncertainties and actual results could differ materially from those projected with your extra care filings with the Securities and Exchange Commission for a detailed discussion of these risks and uncertainties.

Speaker Change: During the call. We will also discuss non-GAAP financial measures as defined by SEC regulation G.

Speaker Change: Reconciliations of these non-GAAP measures to the most directly comparable GAAP financial measures are included in our earnings release and in our supplemental information.

Speaker Change: This call is being recorded for rebroadcast for a period of time in the future as such it is important to note that management's comments include time sensitive information that may only be accurate as of todays date August 2nd 2024. At this time all participants are in listen only mode. Following managements prepared comments the call will be opened for your questions. We were.

Ashley Curtis: As such, it is important to note that management comments include time-sensitive information that may only be accurate as of its date, August 2, 2024. At this time, all participants are in listen-only mode. Following management's prepared comments, the call will be open for your questions. We request that everyone ask only one question and one follow-up question. In this time permits, we are happy for you to reach you for additional questions.

Ashley Curtis: Following management's prepared comments, the call will be open to your questions. We request that everyone ask only one question and one follow-up question, and if time permits, we are happy for you to requeue for additional questions. On the call today will be Stephen Yalof, President and Chief Executive Officer, and Michael Bilerman, Chief Financial Officer and Chief Investment Officer. In addition, other members of our leadership team will be available for Q&A. I will now turn the call over to Steven Yalof. Please go ahead.

Speaker Change: That everyone ask only one question and one follow up question and if time permits we were happy for you to requeue for additional questions on the call today will be Stephen Yalof, President and Chief Executive Officer, and Michael Bilerman, Chief Financial Officer, and Chief Investment Officer. In addition, other members of our leadership team will be available for Q&A I will now turn the call over to Steven.

Ashley Curtis: On the call today, we'll be Steven Yala, President and Chief Executive Officer, and Michael Billerman, Chief Financial Officer and Chief Investment Officer. In addition, other members of our leadership team will be available for Q&A.

Ashley Curtis: I will now turn the call over to Steven Yala. Please go ahead.

Speaker Change: Please go ahead.

Steven Yala: I'm pleased to announce another quarter of strong performance and an increase in our full-year guidance. Our same center N.O.I. grew by 8% from the prior year, while FFO for share was up 13%. These results demonstrate the continued execution of our strategy and our focus on optimizing our value proposition to both retailers and shoppers. We are elevating the retail mix in our centers and creating a community experience to drive traffic and increase engagement. Our centers are well-located in fast growing markets that benefit from an attracted mix of tourists, seasonal, and local residents. We are delivering a personalized and engaging experience to target each of these audiences.

Stephen Yalof: I'm pleased to announce another quarter of strong performance and an increase in our full-year guidance. Same center NOI grew by 8% from the prior year, while FFO per share was up 13%. These results demonstrate the continued execution of our strategy and our focus on optimizing our value proposition to both retailers and shoppers. We're elevating the retail mix in our centers and creating a community experience to drive traffic and increase engagement. Our centers are well located in fast-growing markets that benefit from an attractive mix of tourists, seasonal, and local residents. We're delivering a personalized and engaging experience to target each of these audiences. Year-to-date traffic was held to last year's levels, with growth in May and June.

Stephen Yalof: I'm pleased to announce another quarter of strong performance at.

Speaker Change: And an increase in our full year guidance, our same center NOI grew by 8% from the prior year, while F. F O per share was up 13%.

Speaker Change: These results demonstrate the continued execution of our strategy.

Speaker Change: Focus on optimizing our value proposition to both retailers and shoppers.

We are elevating the retail mix in our centers and creating a community experience to drive traffic and increase engagement.

Speaker Change: Our centers are well located in fast growing markets that benefit from an attractive mix of tourists.

Speaker Change: Seasonal and local residents.

Speaker Change: We are delivering a personalized and engaging experience to target each of these audiences.

Steven Yala: Year-to-date traffic was held to last year's levels with growth in May and June. We've also seen continued positive momentum in sales, with another sequential quarterly increase in our sales productivity for the trailing 12 months. We continue to enhance the value of our centers for our customers by curating the right mix of brands, food and beverage, and entertainment uses. And elevating and creating and exciting and dynamic shopping experience. This strategy has led us to achieve our 10th consecutive quarter of positive rent spreads, which drives total rent and N.O.I. growth. The man for our space continues to be strong, driving robust leasing activity.

Year to date traffic was held to last year's levels with growth in May and June.

Stephen Yalof: We've also seen continued positive momentum in sales with another sequential quarterly increase in our sales productivity for the trailing 12 months. We continue to enhance the value of our centers for our customers by curating the right mix of brands, food and beverage, and entertainment uses, and Elevating and Creating an Exciting and Dynamic Shopping Experience. This strategy has led us to achieve our 10th consecutive quarter of positive rent spreads, driving total rent and NOI growth.

Speaker Change: We've also seen continued positive momentum in sales with another sequential quarterly increase in our sales productivity for the trailing 12 months.

Speaker Change: We continue to enhance the value of our centers for our customers by Curating, the right mix of brands food and beverage and entertainment uses.

Speaker Change: And elevating and creating an exciting and dynamic shopping experience.

Speaker Change: This strategy has led us to achieve our 10th consecutive quarter of positive rent spreads, which drives total rent and NOI growth.

Stephen Yalof: Demand for our space continues to be strong, driving robust leasing activity. We've executed 2 million square feet of leases over the trailing 12 months and an average spread of 15%, which we believe demonstrates the importance our retailers place on being in a Tanger Center. We ended the quarter with 96.5% occupancy.

Speaker Change: Demand for space continues to be strong driving robust leasing activity.

Steven Yala: We've executed 2 million square feet of leases over the trailing 12 months and an average spread of 15%, which we believe demonstrates the importance our retailers place on being in a Tanger center. We ended the quarter with 96.5% occupancy. As of quarter end, we had renewals executed or in process for 66% of the space expiring this year, ahead of last year's pace. We continue to believe in our real estate and focus on optimizing our merchandising mix, whether through renewals or recanniting, we're appropriate. We are very pleased with the execution of our strategy to enhance and diversify our retailer mix with more productive brands.

Speaker Change: We've executed 2 million square feet of leases over the trailing 12 months and an average spread of 15%, which we believe demonstrates the importance our retailers place I'm being in a Tanger center.

Speaker Change: We ended the quarter with 96, 5% occupancy.

Stephen Yalof: As of quarter end, we had renewals executed or in process for 66% of the space expiring this year, ahead of last year's. We continue to believe in our real estate and focus on optimizing our merchandising, whether through renewals or re-tenanting, where appropriate. We are very pleased with the execution of our strategy to enhance and diversify our retailer mix with more productive brands. In addition to growing relationships with our existing tenants, we've seen approximately half of our re-tenanting activity come from new to portfolio brands over the past year and a half. And many are seeing success and are expanding.

As of quarter end, we had renewals executed or in process for 66% of the space expiring this year.

Speaker Change: Ahead of last year's pace.

Speaker Change: We continue to believe in our real estate and focus on optimizing our merchandising mix, whether through renewals or re tenant them where appropriate.

Speaker Change: We are very pleased with the execution of our strategy to enhance and diversify our retailer mix with more productive brands in.

Steven Yala: In addition to growing relationships with our existing tenants, we've seen approximately half of our recanniting activity come from new to portfolio brands over the past year and a half, and many are seeing success and expanding. For example, we've executed leases for six new Sephora stores, five of which are under construction and will open in the coming months. We're also activating peripheral land with concepts that draw additional traffic. Our new tenant pipeline is strong, and we are encouraged by the momentum going into next year as we grow relationships with new and innovative brands. As publicly announced, Route 21 and Express both recently went through bankruptcy proceedings.

Speaker Change: In addition to growing relationships with our existing tenants.

Speaker Change: Approximately half of our re tendering activity come from new to portfolio brands over the past year and a half.

Speaker Change: And many are seeing success in expanding.

Stephen Yalof: For example, we've executed leases for six new Sephora stores, five of which are under construction and will open in the coming month. We're also activating peripheral land with concepts that draw additional traffic. Our new tenant pipeline is strong, and we are encouraged by the momentum going into next year as we grow relationships with new and innovative. As publicly announced, Route 21 and Express both recently went through bankruptcy proceedings; we maintain proactive relationships with all of our tenants.

Speaker Change: For example, we've executed leases for six new Sephora stores.

Speaker Change: Five of which are under construction and will open in the coming months.

Speaker Change: We're also activating peripheral land with concepts that draw additional traffic.

Speaker Change: Our new tenant pipeline is strong and.

Speaker Change: And we are encouraged by the momentum going into next year, as we grow relationships with new and innovative brands.

Speaker Change: As publicly announced route 21 and express both recently went through bankruptcy proceedings.

Steven Yala: We maintain proactive relationships with all of our tenants, and we are prepared for these situations and worked expeditiously to a resolution. Out of the 50 combined stores in our portfolio, only one was rejected, and we elected to recapture three other locations with near-term explorations to immediately retenant at greater rents. The Route 21 stores closed while they went through their ownership change, and they had begun to reopen and will all be open prior to the holiday selling season. It may be published our 2023 ESG report which discusses our focus on enhancing our sustainability metrics, resource efficiency, stakeholder engagement, and return on these investments.

Speaker Change: We maintain proactive relationships with all of our tenants and we are prepared for these situations and worked expeditiously to a resolution.

Stephen Yalof: And we are prepared for these situations and worked expeditiously to reach a resolution. Out of the 50 combined stores in our portfolio, only one was rejected, and we elected to recapture three other locations with near-term expirations to immediately retenant at greater risk. The Route 21 stores closed while they went through their ownership change, and they have begun to reopen and will all be open prior to the holiday selling season.

Speaker Change: Out of the 50 combined stores in our portfolio only one was rejected.

Speaker Change: We elected to recapture three other locations with near term expirations to immediately re tenant a greater rents.

The route 21 stores closed while they went through their ownership change and they have begun to reopen and will all be open prior to the holiday selling season.

Stephen Yalof: In May, we published our 2023 ESG report, which discusses our focus on enhancing our sustainability metric: Resource Efficiency, Stakeholder Engagement, and Return on These Investments. A few highlights include our notable increase in renewable energy production and the further rollout of electric vehicle charging stations; our initiatives to foster a healthy workplace culture and community involvement; and our commitment to diversity, governance, and investor engagement. In June, we were honored to receive the 2024 NARIT Investor Care Gold Award for Communication and Reporting Excellence.

Speaker Change: In May we published our 2023, ESG report, which discusses our focus on enhancing our sustainability metrics.

Speaker Change: Resource efficiency stakeholder engagement and return on these investments.

Steven Yala: A few highlights include our notable increase in renewable energy production and the further roll out of electric vehicle charging stations. Our initiatives to foster a healthy workplace culture and community involvement, and our commitment to diversity governance and investor engagement. In June, we were honored to receive the 2024 NARREET Investor Care Gold Award for communication and reporting excellence. I want to thank the entire Tanger team, our customers, and all of our stakeholders for their continued support.

Speaker Change: A few highlights include our notable increase in renewable energy production and the further rollout of electric vehicle charging stations.

Speaker Change: Our initiatives to foster a healthy workplace culture, and community involvement and our commitment to diversity governance and investor engagement.

Speaker Change: In June we were honored to receive the 'twenty 'twenty four NAREIT Investor Care Gold award for communication and reporting excellence.

Stephen Yalof: I want to thank the entire Tanger team, our customers, and all of our stakeholders for their continued support. I'd now like to turn the call over to Michael to discuss our financial results, balance sheet, and outlook for the remainder of the year. Thank you, Steve.

Speaker Change: I want to thank the entire Tanger team our.

Speaker Change: Our customers and all of our stakeholders for their continued support.

Michael Bilerman: I'd now like to turn the call over to Michael to discuss our financial results, balance sheet, and outlook for the remainder of the year.

Speaker Change: I'd now like to turn the call over to Michael to discuss our financial results balance sheet and outlook for the remainder of the year.

Michael Bilerman: Thank you, Steve.

Michael: Thank you Steve.

Michael Bilerman: Today, I'm going to discuss our second quarter financial results, our balance sheet activity, and our increased guidance for the year. In the second quarter, we delivered core FFO of 53 cents a share, compared to 47 cents a share in the second quarter of the prior year, as we saw continued core growth, along with the contributions from the three new centers that we added in the fourth quarter of last year. Same Center NOI increased 8% for the quarter, driven by higher rental revenues from the continued strong retailer demand and robust leasing activity, leading to increased base rent, as well as higher expense recovery.

Michael Bilerman: Today I'm going to discuss our second quarter of financial results, our balance sheet activity, and our increased guidance for the year. In the second quarter, we delivered core FFO of 53 cents a share compared to 47 cents a share in the second quarter of the prior year. As we saw continued core growth along with the contributions from the three new centers that we added in the fourth quarter of last year. Same Center and a Y increased 8% to the quarter, driven by higher rental revenues from the continued strong retailer demand and robust leasing activity, leading to increased base rents, as well as higher expense recoveries.

Michael: Today, I'm going to discuss our second quarter financial results, our balance sheet activity and our increased guidance for the year.

Michael: In the second quarter, we delivered core <unk> of 53 cents a share compared to 47 cents a share in the second quarter of the prior year as we saw continued core growth along with the contributions from the three new centers that we added in the fourth quarter of last year.

Michael: Same center NOI increased 8% for the quarter driven by higher rental revenues from the continued strong retailer demand and robust leasing activity, leading to increased base rents as well higher expense recoveries.

Michael Bilerman: Our second quarter, same Center and a Y also benefited from flat operating expenses versus last year, and park based on the timing of our operating expenses throughout the year. Within our non-same Center pool, we are pleased with the performance that are three recently added centers in Nashville, Humphill, and Nashville. They are performing in line with our expectations, and we are continuing to execute on our leasing, merchandising, and marketing strategies at each center.

Michael: Our second quarter same center NOI also benefited from flat operating expenses versus last year in part based on the timing of our operating expenses throughout the year.

Michael: Within our non same center pool, we are pleased with the performance at our three recently added centers and Nashville, Huntsville Nashville, They are performing in line with our expectations and we are continuing to execute on our leasing merchandising and marketing strategies at each center.

Michael Bilerman: Our balance sheet remains well positioned to support our internal and external growth initiatives, with low leverage, a largely fixed rate balance sheet, almost full availability in our lines of credit, essentially no debt maturities until late 2026, and ample free cash flow after dividends, given our low dividend payout ratio. At quarter end, we had 1.6 billion dollars of pro-rad and net debt, with a weighted average interest rate of 4.1%. Our net debt to adjusted EVA.re was 5.4 times for the 12 months ended June 30th, and pro-forma for a full year of adjusted EVA. for the three new centers that we added in the fourth quarter, we estimate that our leverage ratio would be between 5.1 to 5.2 times, still one of the lowest in the retail and retail sectors.

Michael Bilerman: Our second quarter same center NOI also benefited from flat operating expenses versus last year, in part based on the timing of our operating expenses throughout the year. Within our non-same center pool, we are pleased with the performance at our three recently added centers in Nashville, Huntsville, and Asheville. They are performing in line with our expectations, and we are continuing to execute on our leasing, merchandising, and marketing strategies at each center. Our balance sheet remains well-positioned to support our internal and external growth initiatives with low leverage, a largely fixed-rate balance sheet, almost full availability on our lines of credit, essentially no debt maturities until late 2026, and ample free cash flow after dividends, given our low dividend payout ratio. At quarter end, we had $1.6 billion of pro-rata net debt with a weighted average interest rate of 4.1%.

Michael: Our balance sheet remains well positioned to support our internal and external growth initiatives with low leverage.

Michael: And largely fixed rate balance sheet.

Michael: Almost full availability on our line of credit.

Michael: Essentially no debt maturities until late 2026.

Michael: And ample free cash flow after dividends, given our low dividend payout ratio.

Michael: At quarter end, we had $1 $6 billion of pro rata net debt with a weighted average interest rate of four 1%.

Michael Bilerman: Our net debt to Adjusted EBITDA RE was 5.4 times for the 12 months ended June 30th, and pro forma for a full year of Adjusted EBITDA for the three new centers that we added in the fourth quarter, we estimate that our leverage ratio would be between 5.1 to 5.2 times, still one of the lowest in the retail and REIT sectors. As previously announced, during the quarter, we also extended the maturity, increased the borrowing capacity, and reduced our pricing on our unsecured lines of credit. At quarter end, we had $585 million of availability under our lines and $20 million of cash and cash equivalents.

Michael: Our net debt to adjusted EBITDA, Our <unk> was five four times for the 12 months ended June 30th.

Michael: And pro forma for a full year of adjusted EBITDA for the three new centers that we added in the fourth quarter, we estimate that our leverage ratio would be between 5.15 0.2 times.

Michael: Still one of the lowest in the retail and REIT sectors.

Michael Bilerman: As previously announced during the quarter, we also extended the maturity, increased the borrowing capacity, and reduced our pricing on our unsecured lines of credit. At quarter end, we had 585 million dollars of availability under our lines, and 20 million dollars of cash and cash equivalents. In April, our board approved a 5.8% increase in our dividend to $1.10 per share annualized, with the shares yielding approximately 4% today. Our quarterly cash dividend remains well covered, with a continued low payout ratio providing 3 cash low to support our growth.

Michael: As previously announced during the quarter. We also extended the maturity increased the borrowing capacity and reduced our pricing on our unsecured lines of credit.

Michael: At quarter end, we had $585 million of availability under our line and $20 million of cash and cash equivalents.

Unknown Executive: In April, our board approved a 5.8% increase in our dividend to $1.10 per share annualized, with the shares yielding approximately 4% today. Our quarterly cash dividend remains well covered with a continued low payout ratio providing free cash flow to support our growth. Now turning to our increased guidance for 2024, we are increasing our core FFO per share expectations to a range of $2.05 to $2.12 from a prior range of $2.03 to $2.11, implying 5% to 8% core FFO growth.

Michael: In April our board approved a five 8% increase in our dividend.

Michael: $1.10 per share annualized.

Michael: With the shares yielding approximately 4% today.

Michael: Our quarterly cash dividend remains well covered with a continued low payout ratio, providing free cash flow to support our growth.

Michael Bilerman: Now, turning to our increased guidance for 2024, we are increasing our core FFO for share expectations to a range of $2.05 to $2.12 for a prior range of $2.03 to $2.11, implying 5 to 8% core FFO growth. We are increasing our same center in a wide growth expectations by 75 basis points at midpoint, to a range of 3.25% to 4.75%, up from 2.25% to 4.25% last quarter. The increases are due to the better-than-expected performance in the second quarter, and our outlook for the balance of the year.

Michael: Now turning to our increased guidance for 2024.

Michael: We are increasing our core <unk> per share expectations to a range of $2.05 to $2.12 for.

Michael: Prior range of $2 and three.

Michael: The $2 11, implying five 8% core <unk> growth.

Unknown Executive: We are increasing our SANE Center NOI growth expectations by 75 basis points at the midpoint to a range of 3.25% to 4.75%, up from 2.25% to 4.25% last quarter. The increases are due to the better-than-expected performance in the second quarter and our outlook for the balance of the year. For additional details on our key assumptions, please see our release issues last night.

Michael: We are increasing our same center NOI growth expectations by 75 basis points at the midpoint.

Michael: So a range of 3.25% to 4.75%.

Michael: Up from 2.25% to 4% to 5% last quarter.

Michael: The increases are due to the better than expected performance in the second quarter and our outlook for the balance of the year.

Unknown Executive: For additional details on our key assumptions, please see our release issue last night. And now, I'd like to turn the call for questions. Operator?

Michael: For additional details on our key assumption. Please see our release issued last night and now I'd like to turn the call for questions operator.

Unknown Executive: And now, I'd like to turn the call over to questions. Thank you. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue.

Unknown Executive: Thank you. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove your question from the queue. And for a participant choosing speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

Unknown Executive: You may press star 2 to remove your question from the queue. And for participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key. Please ask one question and one follow-up question and re-queue for additional questions. Our first question is from Jeff Spector with Bank of America. Please. Morning, it's Andrew Real on for Jeff.

Speaker Change: Thank you if he would like to ask a question. Please press star one on your telephone keypad, a confirmation tone will indicate your line is in the question queue. You May press star two to remove your question from the queue and for participants using speaker equipment. It may be necessary to pick up your handset before pressing the star kids.

Unknown Executive: Please ask one question and one follow-up question and re-cue for additional questions.

Speaker Change: Please ask one question and one follow up question every queue for additional questions.

Andrew Reale: Our first question is from Jeff Spector with Bank of America. Please proceed.

Michael Bilerman: Thanks for taking our questions. Could you just discuss in a little more detail the property expense timing benefit in the period? I guess what specifically saw the benefit? And are there any timing impacts to be aware of in the second half?

Speaker Change: Our first question is from Jeff Spector with Bank of America. Please proceed.

Michael Bilerman: Thanks, Andrew. When you look at our operating expenses, between what we spend on our common area maintenance as well as our marketing expenses, those could be variable through the year, but in part, it impacts what was spent in the year prior in terms of that year-over-year comparison. So when we look at our operating expenses in the second quarter, they were flat year-over-year.

Andrew Reale: It's Andrew Reale on for Jeff. Thanks for taking our questions.

Andrew Real: Morning, It's Andrew real on for Jeff Thanks for taking our questions.

Michael Bilerman: Could you just discuss in a little more detail the property expense timing benefit in the period? I guess what specifically saw the benefit and are there any timing impacts be aware of in the second half?

Andrew Real: Could you just discuss in a little more detail the property expense timing benefit in the period I guess, what specifically saw the benefit and are there any timing impacts to be aware of in the second half.

Michael Bilerman: Thanks, Andrew. When you look at our operating expenses between what we spend on our common area maintenance as well as our marketing expenses, those could be variable through the year. But in part, it impacts what we spent in the year prior in terms of that year-over-year comparison.

Speaker Change: Thanks, Andrew.

Speaker Change: Yeah. When you look at our operating expenses between what we spend on our common area maintenance as well as our marketing expenses.

Speaker Change: Those could be variable through the year.

Speaker Change: But in part it impacts what was spent in the year prior in terms of that year over year comparison. So when we look at our operating expenses in the second quarter. They were flat year over year and as we think about the full year.

Michael Bilerman: So when we look at our operating expenses in the second quarter, they were flat year over year. And as we think about the full year, that sort of blends into our expectations of same center and Y, which we raised at both the low and the high end. We just have some variable timing as that expenses flows through each quarter, affecting that year over year on a quarterly basis. In fact.

Michael Bilerman: And as we think about the full year, that sort of blends into our expectations of same-center NOI, which we raised at both the low and the high end. We just have some variable timing as that expense flows through each quarter, affecting that year over year on a quarterly basis. Okay, thank you.

Speaker Change: That's sort of blends into our expectations as same center NOI, which we raised it up the low and the high end you just have some variable timing of pads and expenses flows through each quarter.

Speaker Change: That's something that you have a year on a quarterly basis.

Speaker Change: In fact.

Unknown Executive: Okay, thank you.

Michael Bilerman: And then guidance to suggest some meaningful deceleration in the same center NOI growth in the back half. Is that just largely due to more downtime as you ramp up re-tenanting efforts, or are there other factors to call out there? Thank you.

Speaker Change: Okay. Thank you and then guidance suggests a meaningful deceleration in the same center NOI growth in the back half.

Michael Bilerman: And then guidance suggests some meaningful deceleration in the same center and our I growth in the back half. Is that just largely due to more downtime as you ramp up reteniting efforts, or are there other factors to call out there?

Speaker Change: Is that just largely due to more downtime as you ramp up retesting efforts or are there other factors to call out there. Thank you.

Michael Bilerman: Thank you. And we look at our business on an annual basis. And when you look at where our guidance is moving, what you've seen is both that low end coming up and the high end moving up.

Michael Bilerman: We look at our business on an annual basis, and when you look at where our guidance is moving, what you've seen is both that low-end coming up and the high-end moving up. And so on a quarterly basis, just going back to that first question, that quarterly impact, from the same center perspective, is going to get impacted by the timing of that, and expenses year over year, but in aggregate for the year, our business is performing very well as I would say on the revenue side, there is a little bit of downtime associated as those roof stores reopen, but that's not a significant impact. And all of that has an exit rate as we go into next year, as all those stores will be open. Our next question is from Floris van Dijkum. At this point, please. Hey morning!

Speaker Change: And we look at our business on an annual basis and when you look at where our guidance is moving what you've seen is a boat that low end coming up in the high end moving up and so.

Michael Bilerman: And so, on a quarterly basis, is going back to that first question that quarterly impact from the same center perspective is going to get impacted by the timing of that expenses year over year. But in aggregate for the year, our business is producing very well as we continue to see that growth. I would say on the revenue side, there is a little bit of downtime associated as those resources reopen, but that's not a significant impact. And all of that has an exit rate as we go into next year, as all those stores will be opened.

Speaker Change: On a quarterly basis, just going back to that first question that quarterly impact.

Speaker Change: From a same center perspective, it has been impacted by the timing of that.

Speaker Change: Expenses year over year, but in aggregate for the year, our business is producing very well as we've continued to see that growth I would say on the revenue side. There is a little bit of downtime associated as those rooms doors reopen but that's not a significant impact and all of that has an exit.

Speaker Change: Right as we go into next year as all of those stores will be opened.

Floris Dijkum: Our next question is from florist Van Daikom with Coppis Point. Please proceed.

Our next question is from Floris Van <unk> with Compass point. Please proceed.

Floris Dijkum: Hey, morning question on the Route 21 leases. So I think you had 20 before 18 or continuing maybe if you could talk about the economics of those leases relative to where they were before and will all 18 open before the, I think you said before the holiday season are going to some of them going to open in the in the third quarter as well. So I think you said before the holiday season are going to open in the third quarter as well.

Stephen Yalof: Question on the route 21 leases. So you I think you had 20 before, and 18 are continuing. Maybe if you could talk about the economics of those leases relative to where they were before. And will all 18 open before the, I think you said before the holiday season, are some of them going to open in the third quarter as well? Good morning, Floris, and thanks for the question.

Speaker Change: Hi, good morning.

<unk> on the.

Speaker Change: The the route 21 leases. So you I think you had 20 before 18 are continuing maybe if you could talk about the economics of those leases relative to where they were before and will all 18 opened before the I think you said before the holiday season that we're gonna some of them going to own.

Speaker Change: Indeed in the third quarter as well.

Steven Yala: Good morning, Farris, and thanks for the question. So, with regard to 321, we started with 20, 18 stores we opened before the end of the year, many of which are reopened. As far as the deals themselves, you know, we don't really get into the details of each of these deals, but, you know, just, we called out very, you know, in our prepared remarks, the two of those stores we elected to take back because we were able to replace that tendency almost immediately with higher paying, paying rent tenants, mitigating part of that expense as well. Remember close covenants, you know, we've made some interesting deals with some tenants that were in bankruptcy, a lot of which we need far more heavily into the over-trend piece of the equation.

Speaker Change: Good morning, and thanks for the question so with regard to <unk> 'twenty, one where we started with 21 18 stores. We opened before the end of the year many of which are already reopened as.

Stephen Yalof: So, with regard to 321, yeah, we started with 20. Well, I have 18 stores reopened before the end of the year, many of which are already reopened. As far as the deals themselves, you know, we don't really get into the details of each of these deals, but, you know, just. We called out in our prepared remarks the two of those stores we elected to take back because we were able to replace that tenancy almost immediately with higher-paying rent tenants mitigating part of that expense as well.

Speaker Change: As far as the deals themselves you know, we don't really get into the details of each of these deals, but you know just we called out.

Speaker Change: Our prepared remarks, the two of those stores, we elected to take back because we were able to replace that tendency almost immediately with higher paying rent and tenants mitigating part of that expense as well.

Stephen Yalof: Remember, post-COVID, we've made some interesting deals with some tenants that were in bankruptcy, a lot of which we lean far more heavily into the overdraft piece of the equation. We think that Route 21, with the new leadership, will really pay us back our part. Shoppers in our centers really love that brand. And under this new leadership, we're looking forward to great results coming from coming out of those stores. I will say the first one that reopened in our portfolio under the new leadership was in our MedBit North Carolina center, right down the street from our corporate office here. And I was customer number one.

Speaker Change: Remember post COVID-19.

Speaker Change: Interesting deals with some tenants that were in bankruptcy lot of which we lean more heavily into.

Speaker Change: The overdrive piece of the equation, we think that route 21 with the new leadership.

Steven Yala: We think that 321, with the new leadership, will really pass back. Our shoppers in our centers really love that brand, and under this new leadership, we're looking forward to great results coming out of those stores. I will say, the first one that reopened our portfolio under the new leadership was in our Medveda North Carolina center, right down the street from our corporate office here. And I was customer number one; it was a great job being experienced. The stores look amazing.

Speaker Change: We're really pay us back R. R.

Speaker Change: <unk> in our centers.

Speaker Change: Really love that brand and under this new leadership, we're looking forward to great results coming out of coming out of those stores I will say the first one that reopened in our portfolio under the new leadership within our <unk>.

Speaker Change: North Carolina Center right downstream from our corporate office here and I was customer number one it was great shopping experience the stores look amazing.

Stephen Yalof: It was a great shopping experience. The stores looked amazing. Thanks, Steve. Maybe I could follow up and have you guys comment on the transaction markets and what you're seeing, and what we can expect, and is it more likely that we're going to see another lifestyle center potentially being added to the, or is it, is there enough opportunity in the outlet sector as well, where you could add another outlet before the end of the year? Thanks, Floris.

Steven Yala: Thanks, Dave. Maybe if I could follow up and have you guys comment on the transaction markets and what you're seeing and what we can expect, and is it more likely that we're going to see another lifestyle center potentially being added to the, or is there enough opportunity in the outlet sector as well, where you could add another outlet before the end of the year? Thanks, Laura. You know, by practice, we're only going to have deals when they're executed. I think we are very active in the marketplace, looking across each of the strategies that we're after, and you know, deals will come about. It is a competitive marketplace.

Speaker Change: Thanks, Steve maybe if I could follow up and have you guys.

Speaker Change: Comments on the transaction markets and what you're seeing and what we can expect an end.

Speaker Change: Is it more likely that we're going to see another lifestyle center potentially being added to the <unk> or is it is there enough opportunity in the outlet sector as well, where you could add another outlet before.

Speaker Change: Before the end of the year.

Stephen Yalof: You know, by practice, we're only going to announce deals when they're executed. I think we are very active in the marketplace, looking across each of the strategies that we're after. And, you know, deals will come about. It is a competitive marketplace. The lens that we are looking through is where we can add value in deals that we want to bring into the Tanger portfolio, where we can create that value from our leasing, our marketing, and our operations to really drive value over time for our stakeholders. And the balance sheet is extraordinarily well positioned with low leverage and a lot of liquidity to be able to act opportunistically when deals come about.

Speaker Change: Thanks, Lauren Yeah, My practice, we only gonna announced deals when they are executed.

Speaker Change: I think we are very active in the marketplace looking across each of the strategies that we're after and deals will come about it is a competitive marketplace. The lens that we're looking through is where can we add value and deals that we want to bring into the tanger.

Steven Yala: The lens that we are looking through is where can we add value in deals that we want to bring into the Tanger portfolio where we can create that value from our we think, our marketing and our operations to really drive value over time for our stakeholders, and the balance sheet is extraordinarily well positioned with low leverage and a lot of liquidity to be able to act opportunistically when deals come about, but we're going to remain very prudent and disciplined on our external growth, and we have a lot of internal opportunities as we continue to grow our same center and why and activate a lot of our peripheral land.

Speaker Change: Portfolio, where we can create that value from our leasing.

Speaker Change: Our marketing and our operations to really drive value overtime for our stakeholders and the balance sheet is extraordinarily well positioned with low leverage and a lot of liquidity to be able to act opportunistically when deals come about.

Michael Bilerman: We're going to remain very prudent and disciplined on our external growth, and we have a lot of internal opportunities as we continue to grow our SING Center NOI and activate a lot of our peripheral land. Our next question is from Todd Thomas with KeyBank Capital Markets. Hi, thanks. Good morning.

Speaker Change: We're going to remain very prudent discipline on our external growth and we have a lot of internal opportunities as we continue to grow our same center NOI and activate a lot of our peripheral land.

Todd Thomas: Our next question is from Todd Thomas with Kibein Capital Markets. Please proceed. Hi, thanks, good morning. I wanted to follow up on the same store and timing of expenses, just to help understand the quarterly cadence in the second half. I think you spoke previously about the full year expense recovery rate being in the mid 80% range, maybe slightly better, which would suggest a very steep decline or drag from that recovery in the second half of the year. Does the updated guidance and same store forecast include an update to the recovery rate for the full year that you're anticipating, or is that sort of mid, mid maybe high 80% range still the right place to be for the full year?

Michael Bilerman: I wanted to follow up on the same store and timing of expenses just to help understand the quarterly cadence in the second half. I think you spoke previously about the full year expense recovery rate being in the mid 80% range, maybe slightly better, which would suggest a very steep decline or drag from net recoveries in the second half of the year. Does the updated guidance, and the Same store forecast, include an update to the recovery rate for the full year that you're anticipating, or is that sort of mid, maybe high 80% range still the right place to be for the full year? Yeah, thanks, Todd.

Speaker Change: Our next question is from Todd Thomas with Keybanc capital markets. Please proceed.

Todd Thomas: Hi, Thanks, good morning.

I wanted to follow up on the same store and.

Todd Thomas: Timing of expenses just to help understand the quarterly cadence in the second half.

Speaker Change: I think you spoke previously.

Speaker Change: About the full year expense recovery rate being in the mid 80% range, maybe slightly better.

Speaker Change: Would suggest a very steep decline or drag from net recoveries in the second half of the year just does the updated guidance and same store forecast include an update too.

Speaker Change: The recovery rate for the full year that you're anticipating or is that sort of mid mid to maybe high 80% range still the right place to be for the full year.

Michael Bilerman: Thanks, John. And I think you hit it right, which is, you know, our expense recovery rate because our CAM is largely fixed. And because we have variable expenses and those expenses tend to be heavier from a variable expenses in the back half and they are in the first half, just naturally the percentage is going to be lower in the second half. Right. And so we continue to believe you saw the expense recovery rate in the first half averaged about 90%.

Michael Bilerman: And, you know, I think you hit it right, which is our expense recovery rate, because our CAM is largely fixed, and because we have variable expenses, and those expenses tend to be heavier from a variable expense in the back half than they are in the first half, just naturally, the percentage is going to be lower in the second half, right? And so, we continue to believe, you saw the expense recovery rate in the first half averaged about 90%, and we continue to expect it to be in the mid-80s for the full year, which would imply, you know, sort of high 70s, low 80s in the back half from our recovery rate, and that CAM is largely fixed, and that expense load will be a little bit variable. In the,

Speaker Change: Thanks, Todd and you know I think you hit it right, which is you know our expense recovery rate because our Tam is largely fixed and because we have variable expenses and those expenses tend to be heavier from a variable expenses in the back half than they are in the first half just naturally that percentage is going to be.

Lower in the second half right and so we continue to believe you saw the expense recovery rate in the first half averaged about 90%.

Michael Bilerman: And we continue to expect to be in the mid 80s for the full year, which would imply, you know, sort of high 70s, low 80s in the back half from our recovery rate. And that cam is largely fixed, and that expense load will be a little bit variable in the second half.

Speaker Change: And we continue to expect to be in the mid <unk> for the full year, which would imply sort of high <unk> low <unk>.

Speaker Change: In the back half from a recovery rate.

Speaker Change: Yeah, Ken is largely fixed and the expense load will be a little bit variable.

Speaker Change: The second half.

Michael Bilerman: Okay. And then, you know, in terms of thinking about 2025, a little bit, you know, relative to this year, you know, how should we think about, you know, I guess net recoveries going forward. I know that there's, you know, the leasing some of the leasing initiatives and, you know, you've talked about the structure of the leases and so forth that are, you know, underway. And how you've been transitioning the tenant base a little bit, you know, can you sustain this high expense recovery rate going forward?

Michael Bilerman: Okay, and then, you know, in terms of thinking about 2025, a little bit relative to this year, how should we think about, you know, I guess, net recovery? I know that there are, you know, some of the leasing initiatives and, you know, you've talked about the structure of the leases and so forth that are, you know, underway and how you've been transitioning the tenant base a little bit. You know, can you sustain this high expense recovery rate going forward? Is there a little bit of room on the upside still, or could it potentially be a drag?

Ken: Okay, and then you know in terms of thinking about 2025, a little bit.

Speaker Change: Relative to this year you know how how should we think about you.

Speaker Change: You know I guess net recoveries.

Speaker Change: Going forward I know that there's you know it.

No the leasing some of the leasing initiatives and and you know you've talked about.

Speaker Change: So the structure of the leases and so forth that are underway and how you've been transitioning the tenant base a little bit.

Speaker Change: Can you sustain this high expense recovery rate going forward is there.

Michael Bilerman: Is there a little bit of room to the upside still, or could it potentially be a drag next year as we think about, you know, the year of your comps? So we're not prepared for this 2025 guidance to stay tuned for that for next February, but you know, our strategy is we continue to push rent. You see the leasing spreads that we disclose in supplemental that pushes both base rent and expense recoveries. So we're trying to grow that amount, and we're trying to operate it efficiently as possible in terms of our expenses. And so these trends, and that's what we're trying to keep on driving NLI growth.

Speaker Change: A little bit of room to the upside still or could it potentially be a drag.

Michael Bilerman: next year as we think about, you know, the year-over-year complex. So we're not prepared to give 2025 guidance. We'll have to stay tuned for that for next February. But, you know, our strategy is we continue to push rent. You see the leasing spreads that we disclosed in the supplemental. That pushes both base rent and expense recoveries. So we're trying to grow that amount, and we're trying to operate as efficiently as possible in terms of our expenses.

Speaker Change: Next year as we think about the year over year comps.

Speaker Change: So we're not prepared to give 'twenty guidance well have to stay tuned for that for next February but our strategy as we continue to push rent you would see in the leasing spreads that we disclosed in the supplemental that pushes the base rent and expense recoveries. So we're trying to grow that up now and we're trying to operate as efficiently impossible in terms.

Speaker Change: Of our expenses.

Michael Bilerman: And so these trends, I mean, that's what we're trying to keep on driving NOI growth. That's the whole name of the game is trying to drive NOI and cash flow growth. And so that's what we'll continue to try to push each and every day.

Speaker Change: And so these trends I mean, that's what we're trying to keep on driving NOI growth. That's the whole name of the game is trying to drive NOI and cash flow growth and so that's what we'll continue to try to push each and everyday.

Michael Bilerman: That's the whole name of the game is trying to drive NLI and cash low growth. And so that's what we're looking to do to try to push each and every day.

Craig Mailman: Our next question is from Craig Melmond with City Group, please proceed. Good morning. Steve, I'm just curious; you know, adding support of the portfolio was a good win. I'm just, you know, wondering, have you had a pick up in, you know, calls or interest from tenants you've been courting, or just new tenants you haven't really spoken with. Post that announcement, who are interested in, you know, maybe opening a first outlet outpost or, you know, interested in tang or now more so given that announcement.

Speaker Change: Our next question is from Craig Mailman with Citigroup. Please proceed.

Stephen Yalof: Steve, I was curious, you know, adding Sephora to the portfolio was a good win. I'm just, you know, wondering, have you had a pick-up in, you know, calls or interest from, you know, tenants you've been courting or just new tenants, you haven't really spoken with post that announcement who are interested in, you know, maybe opening a first outlet, Outpost, or, you know, interested in Yeah, the answer is yes.

Craig Mailman: Hey, good morning.

Craig Mailman: Steve I was just curious you know, adding sephora to the portfolio a was a good win I'm just wondering.

Craig Mailman: I'm wondering have you had.

Craig Mailman: Pick up in you know calls or interest from tenants you've been courting or just new tenants you haven't really spoken with post that announcement who are interested in.

Speaker Change: Maybe opening our first outlet.

Speaker Change: Outpost or you know interested in Tanger.

Speaker Change: Now more so given that announcement.

Steven Yala: Yeah, the answer is yes. You know, we said in our prepare the March earlier that half of our new these things in the past 18 months has been new to Tang or platform retailers. You know, I think they're responding to a number of things. First of all, just to change the makeup of our shopping center where we're pivoting from pure play outlet retail. If most of our properties to adding better food beverage, adding entertainment, adding local uses and better amenities. We think it speaks to the local customers as well as tourists that shopping in the marketplace extends stays.

Speaker Change: Yeah. The answer is yes.

Stephen Yalof: You know, we said in our prepared remarks earlier that half of our new... [inaudible] in the past 18 months has been new to Tanger platform retailers. You know, I think they're responding to a number of things. First of all, just the change in the makeup of our shopping center, where we're pivoting from pure play outlet retail in most of our properties to adding better food and beverage, adding entertainment, adding local uses, and better amenities. We think it speaks to the local customer as well as the tourist that's shopping in the marketplace. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye.

Speaker Change: We said in our prepared remarks earlier that half of our new.

Speaker Change: Leasing.

Speaker Change: In the past 18 months has been new to Tanger platform retailers.

Stephen Yalof: And just separately. You know, you guys consistently have kind of put up good rent spreads here. What is the update on where kind of the blended OCR is versus that target? You know, 10 to 12%, you know, how much, how many of your centers are also kind of already at that target? You know, centers that you have more work to do, just give us a sense of, you know, the breakdown of that as well, because sometimes it gets lost in the average.

Speaker Change: They are responding to a number of things first of all just the change in the makeup of our shopping center, where we're pivoting from pure play outlet retail at most of our properties to adding better food beverage and entertainment, adding local uses and better amenities. We think it speaks to the local customers.

Speaker Change: Tourist shopping in the marketplace.

Speaker Change: <unk> states it gets more customers in the door and increase is frequency.

Steven Yala: It gets more customers in the door and increases frequency. That's the support; the support deals will do just that. I mean, the supporters got a very loyal shopper that will shop our shopping centers for more frequently than they made for a traditional outlet brand. And we think the synergy of those two together will definitely open the door for further conversations with brands that are looking to the outlet platform to get in front of the customer.

For the surf warrant deals will do just that I mean, the support has got a very loyal shopper.

Speaker Change: Chop, our shopping centers, who are more frequently than they may for a traditional outlet brands and we think the synergy of those two together we will definitely be open the door for further conversations with brands that are looking to the outlet platform to get in front of a customer they may not see in any of their other channels.

Unknown Executive: Charles.

Unknown Executive: And you're separately, you guys consistently have kind of put up good rent spreads here.

Speaker Change: And just separately.

Speaker Change: You guys consistently have kind of put up good rent spreads here.

Unknown Executive: What is the update on where kind of the blended OCR is versus that target, you know, 10 to 12 percent? You know, how much, how many of your centers also are kind of already at that target versus, you know, centers that you have more work to do? Just give us a sense of, you know, the breakdown of that as well. Because sometimes it gets lost in the average. Sure, makes sense. And look, I would say we dispose of a few non-core assets over the past two or three years. Most Iranian centers in our portfolio are all positive contributors.

Speaker Change: What is the update on where kind of the blended OCR is versus that target you know 10% to 12%.

Speaker Change: How much.

Speaker Change: How many of your centers also.

Speaker Change: Are kind of already at that target versus.

Speaker Change: Centers that you have more work to do just give us a sense of you know the breakdown of that as well because sometimes that gets lost in the average.

Stephen Yalof: Sure, makes sense. And look, I would say we disposed of a few non-core assets over the past two or three years. Most of the rating centers in our portfolio are all positive contributors. So currently, we're at about a 9.4% OCR.

Speaker Change: Sure. It makes sense and look I would say, we disposed of a few non core assets over the past.

Speaker Change: Two or three years.

Speaker Change: Most of the rain centers in our portfolio are all positive contributors. So currently we're at about a nine 4%.

Steven Yala: So currently we're about a 9.4 percent OCR. When we started talking about this several years ago, we were in 8 percent and said that we've got opportunity to get into the double digits. It takes time to get there because we certainly don't touch every single lease every year, but the spreads are great contributors to us growing our rents. We have a strategy of poor placing versus renewing; our retention rates have been historically 95 percent over the past few years. We're meaning a little bit more heavily into replacing some of the retailers that need to either be right-sized or just aren't as productive as they might have been with far more productive retailers.

Stephen Yalof: You know, when we started talking about this several years ago, we were at 8% and said that we've got an opportunity to get into the double digits. It takes time to get there, because we certainly don't touch every single lease every year. But the spreads are a great contributor to us growing our rents. We have a strategy.

Speaker Change: When we started talking about this several years ago over an 8% incentives, we've got opportunities to get into the double digits.

Speaker Change: It takes time to get there because we certainly don't touch every single lease every year.

Speaker Change: But the spreads are great contributors to us growing our rents we have a strategy of.

Stephen Yalof: We're placing versus renewing; our retention rates have been historically 95% over the past few years. We're leaning a little bit more heavily into replacing some of the retailers that need to either be right-sized or just aren't as productive as they might have been with far more productive retailers, evidenced by the Sappora brand that you just mentioned and a number of others. So we think all of those will lead to us to continue to drive rents, grow our productivity in each of our centers on a sales per square foot basis, and make our shopping centers far more interesting for the customers that come and visit us. Our next question is from Greg McGinniss with Scotiabank. Please proceed.

Speaker Change: Oh, replacing versus renewing our retention rates have been historically, 95% over the past few years.

Speaker Change: We're leaning a little bit more heavily into replacing some of the retailers that either be right sized.

Speaker Change: Just aren't as productive as they might have been with far more productive retailers evidenced by MS. Support a brand that you just mentioned a number of others. So we think all of those will lead to us to continue to drive rents grow our productivity in each of our centers on a sales per square foot basis.

Steven Yala: Evidence by the support brand that you just mentioned and a number of others. So we think all of those will lead to us to continue to drive rents, grow our productivity in each of our centers on a sales per square foot basis.

Steven Yala: And make our shopping centers far more interesting from the customers that come and visit us every day.

Speaker Change: And make our shopping centers far more interesting for the customers that come and visit US every day.

Greg Mcginniss: Our next question is from Greg McGinnis with Scotiabank. Please proceed. Okay, good morning. I just want to follow up on your comment regarding activating peripheral land. Can you give us any details in terms of how much space is left to add out parcels or just entitlements on square footage? Any sort of detail you can provide in terms of what the opportunity set is on that peripheral land would be appreciated. Sure, well, first of all, you know, we've said in the past that I'll reiterate that over half of our shopping centers have some peripheral land attached to them.

Speaker Change: Our next question is from Greg Mcginniss with Scotiabank. Please proceed.

Greg Mcginniss: Hey, good morning.

Stephen Yalof: Just want to follow up on your comment regarding any details in terms of parcels, titlements on square footage, any sort of detail you can provide in terms of, Um, sure. Well, first of all, we've said in the past, and I'll reiterate, that over half of our shopping centers have some peripheral land attached to them. Most of that land is already approved by virtue of being on a retail footprint already. So the improvements are there. The parking facilities are there.

Greg Mcginniss: Want to follow up on your comment regarding activating peripheral land can you give us any details in terms of.

Greg Mcginniss: How much space is left to add out parcels or just kind of you know entitlements on square footage any sort of detail you can provide in terms of what the opportunity set is on that on that peripheral land would be appreciated.

Speaker Change: Sure well first of all you know, we said in the past and I'll reiterate that over half of our shopping centers have some peripheral land.

Speaker Change: Attached to them most of that land is already approved by virtue of being on a retail footprint already so the improvements are there. The parking facilities are there so that peripheral land activation is a great source of revenue for us because it requires relatively little capital and relatively.

Steven Yala: Most of that land is already approved by virtual being on a retail footprint already. So the improvements with there, the parking facilities are there so that peripheral land activation is a great source of revenue for us because it requires relatively low capital and relatively high returns. You know, there are some instances where we all have a pad or two, and other instances where we have acres of land that were earmarked for either a phase two of one of our productive shopping centers or some of our alternative uses. Some of which that we've executed through in recent years are hotel pads, entertainment uses like Dave and Buster's, sit down restaurants from Cracker Barrel to Texas Roadhouse, and most recently are most recent executed leads in Savannah, Georgia, where we've added a planning fit.

Stephen Yalof: So that peripheral land activation is a great source of revenue for us because it requires relatively low capital and relatively high return. You know, there are some instances where we all have a pad or two and other instances where we have acres of land that have been earmarked for either phase two of one of our productive shopping centers or some alternative uses. Some of the ones that we've executed on in recent years are hotel pads, entertainment uses like Dave and Buster's sit-down restaurants from Cracker Barrel to Texas Roadhouse, and most recently, our most recent executed lease in Savannah, Georgia, where we've added a Planet Fit.

Speaker Change: High returns.

Speaker Change: You know there are some instances, where we all have a pad or two in other instances, where we have acreage. The plans that were earmarked for either a phase two more productive shopping centers or some alternative uses some of which we've executed to in recent years our hotel pads.

Speaker Change: Entertainment uses like Dave and Busters sit down restaurants.

Speaker Change: From Cracker barrel too.

Speaker Change: Texas Roadhouse.

Speaker Change: And most recently our most recent executed lease in Savannah, Georgia, where we've added a planet fitness. So we're looking to monetize.

Steven Yala: Yes. So we're looking to monetize that land, but also create important destinations for the local catchment, as well as the tourists that shop in our shopping serves.

Stephen Yalof: So we're looking to monetize that land but also create important destinations for the local catchment as well as the tourists that shop in our. Okay, I do think that we investors may appreciate a little more disclosure about where money is being spent on that peripheral land and expected yields on that. So my follow-up question, just looking at the HUNTSVILLE occupancy. Yep.

Speaker Change: Monetize that land.

Speaker Change: But also create.

Speaker Change: Important destinations for the local catchment as well as the tourists that shop in our shopping centers.

Unknown Executive: Okay, I do think that we investors may appreciate a little more disclosure in terms of where money is being spent on that peripheral land, expected yields on that, how much is available. But to my follow-up question, just looking at the hunter of our supplemental includes all the money that we spend, you know, for all of our activities, both what we invest in the portfolio, new developments, and all the TAs, and seconding that are all operating catbacks. So the dollars are all there. Yeah, and I appreciate that.

Speaker Change: Okay, I do think that we Oh investors may appreciate a little more disclosure in terms of where money is being spent on that peripheral land expected yields on that and how much is available but because of my follow up question just looking at Huntington.

Speaker Change: Yeah right.

Stephen Yalof: Right. Page 10 of our supplementary includes all the money that we spend on all of our activities, both what we invest in the portfolio, new developments, and all the TAs, and second, and our operating cap. So the dollars are all there. Yeah, no. I appreciate that.

Speaker Change: Our supplemental includes all the money that we spend.

Speaker Change: For all of our activities, both what we invest in the portfolio new developments in all of the Tas.

Speaker Change: Second.

Speaker Change: Operating capex. So the dollars are all there.

Greg Mcginniss: Just some details on the projects would be appreciated. But just for the follow-up on the hustle occupancy, it seems like we've been in a couple of declines or last few quarters. I'm just curious what's driving that, how touring is going for that property, what you expected kind of on the long-term lease up, you know, and over the next few years, who kind of tend to try to add in, and what might be happening on the occupancy front. Sure, well, we close the deal with an occupied Bed Bath & Beyond that we knew was going to close.

Speaker Change: Yeah, No I appreciate that just some details on the projects would be appreciated.

Stephen Yalof: Just for the follow-up on the Huntsville occupancy, it seems like... A couple of declines in the last few... Curious what's driving that, how Turing's going for that property, and what you expect. On the long-term lease up, you know, and over the next few years, on the. Uh, sure. Well, we closed the deal with an occupied Bed, Bath, and Beyond that we knew was going to close. We had a number of retailers interested in that box. We're under contract with one right now.

Speaker Change: But just for the follow up on the Huntsville occupancy it seems like it's been a couple of declines in the last few quarters I'm just curious what's driving that how touring is going for that property are what you expected kind of on a long term lease up and over the next few years, what kind of tenants are you trying to add in and what might be happening.

Speaker Change: On the occupancy front.

Speaker Change: Sure well, we closed the deal with an occupied bed Bath and beyond that we knew was going to close.

Steven Yala: We had a number of retailers interested in that box, were under contract with one right now. Initially, our strategy was retaining where that location was, but we're moving forward with a deal that's currently in process. And that'll get the occupancy number up because that's really what that material. So the decline that you're talking about was really due to that one space, pretty big space well to decide the shopping center. But with regard to leasing, we've added worthy Parker; we just executed a lease with Starbucks, and there's a number of new brands to come. You know, that shopping center was a great buy for us at the going in yield, but there's a lot of opportunity as spaces will start to turn over the next couple of years to be tentative and upgrade the retailer next.

Speaker Change: We had a number of retailers interested in that box, we're under contract with one right. Now initially our strategy was retail lending where that location was but we're moving forward with the deal. That's currently in process and that'll get the occupancy number up because thats really what this material.

Stephen Yalof: Initially, our strategy was to re-tenant where that location was, but we're moving forward with a deal that's currently in process, and that'll get the occupancy number up because that's really what the material decline here, or the decline that you're talking about was really due to that one space, a pretty big space relative to the size of the shop. But with regard to leasing, we've added Worthy Parker. We just executed a lease with Starbucks, and there are a number of new brands to come.

Speaker Change: To find here.

Speaker Change: But youre talking about was really due to that that one space.

Speaker Change: Pretty big space relative to size the shopping center.

Speaker Change: But with regard to leasing we've we've added worthy Parker, we just executed a lease with Starbucks and Theres, a number of new brands to come.

Stephen Yalof: You know, that shopping center was a great buy for us at the going-in yield, but there's a lot of opportunity and space we'll start to turn over in the next couple of years to re-tenant it and upgrade the retailer next. There's a lot of interest in the property, and, you know, as is our practice, we don't typically mention retailers until we've executed those leases, so there'll be some really good news stories coming out of Huntsville, Alabama, in the coming months and quarters. Our next question is from Samir Khanal with Evercore ISI. Hey, good morning.

Speaker Change: You know that shopping center was a great buy for us at the going in yield, but theres a lot of opportunity in spaces, we will start to turn it over the next couple of years to re tenant it and upgrades retailer mix, there's a lot of.

Steven Yala: There's a lot of interest in the in the property. And you know, as is our practice, we don't typically mention retailers until we've executed those leases.

Speaker Change: Our interest in the property and you know as I.

Speaker Change: As is our practice, we don't typically mentioned retailers until we've executed those leases. So there'll be some really good news stories coming out of Huntsville, Alabama in the next coming months.

Steven Yala: So there'll be some really good news stories coming out of Huntsville, Alabama in the next coming months and at quarters.

Speaker Change: At quarters.

Caitlin Burrows: Our next question is from the smear canal with Evercore ISI. Please proceed. Good morning. Is Steve, can you comment on maybe a little bit more on sales and traffic? I know you've talked a little bit about in your commentary, but what have you seen in July, sort of on a for sales, maybe even traffic on a sequential basis given, you know, you hear about the consumer being pressured with inflation, you know macro slow and just trying to get a bit more color here. Thanks. Yeah.

Sumeer Nahal: Our next question is from the smear canal with Evercore ISI. Please proceed.

Stephen Yalof: Hey, Steve, can you comment maybe a little bit more on sales and traffic? I know you talked a little bit about it in your commentary, but what have you seen in July sort of on a, for sales, maybe even traffic on a sequential basis, given, you know, you hear about the consumer being pressured with inflation, you know, macro slowing, just just trying to get a bit more color here. Yeah, well, we've reported that our sales have grown sequentially in the last two consecutive quarters against relatively flat traffic numbers, you know, anticipating July probably to follow a similar trend.

Smeer Kanal: Hey, good morning, Steve.

Steve: Steve can you comment on.

Smeer Canal: Maybe a little bit more on sales and traffic I know you.

Speaker Change: You talked a little bit about in your commentary, but what have you seen in July sort of on a.

Speaker Change: For sales, maybe even traffic on a sequential basis, given you know.

Speaker Change: Hear about the consumer being pressured with inflation, you know macro slowing just trying to get a bit more color here.

Steven Yala: Well, you know, we reported that our sales have grown sequentially the last two consecutive quarters against relatively flat traffic numbers. You know, anticipating July, probably to follow the similar trend. The good news part of that story is, with very little new retail development, we still have a very active queue of retailers that are lining up to take space in our shopping centers. Now, there's been a lot of activity in the outlet business, all of which we think is really good for our industry, and I'll cater to the investments in our European outlet company, the high occupancy at which Nashville opened, Tulsa, which is the premium center that will open in the coming weeks.

Speaker Change: Yeah well.

Speaker Change: We reported that our sales have grown sequentially the last two consecutive quarters against relatively flat traffic numbers and.

Anticipating July probably to follow the similar trend.

Stephen Yalof: You know, the good news part of that story is that with very little new retail development, we still have a very active queue of retailers that are lining up to take space in our shopping centers. And there's been a lot of activity in the outlet business. All of which we think is really good for our industry. Elkaterton's investment in a European outlet company, the high occupancy rate at which Nashville opened, and Tulsa, which is the premium center that will open in the coming weeks, we understand will open at a very high occupancy rate, really speaks to retailer interest in our space and the demand that's pushing the rest. Okay, thank you for that.

The good news part of that story is with very little new retail development, we still have a very active Q retailers that are lining up to take space in our shopping centers.

Speaker Change: There's been a lot of activity in the outlet business.

Speaker Change: All of which we think is really good for our industry L Catterton investment.

Speaker Change: European out by company.

Speaker Change: The high occupancy at which Nashville opened on Tulsa.

Speaker Change: Which is the premium center that will open in the coming weeks, we understand will open at a very high occupancy really speaks to a retailer interest in aerospace.

Steven Yala: We understand we'll open at a very high occupancy; it really speaks to retailer interest in our space and the demand that's pushing the rest.

Speaker Change: And I mean demand, it's pushing the rents.

Unknown Executive: Lawrence. Okay, thank you for that.

Speaker Change: Yeah.

Michael Bilerman: And then, I guess, Michael, just in terms of capital allocation, I know you spoke a little bit about sort of the opportunities out there in the open air side, maybe. But are you seeing more opportunities come to market at this point, given what you know what interest rates have done over the last, let's call it, 90 days? Yeah, I think that from a retail fundamental perspective, which is really across all the different formats, there certainly is interest, combined with the overall rate environment. I think that could unlock some opportunities, and we'll just be prudent and disciplined as we go about them.

Speaker Change: Okay. Thank you for that and then I.

Michael Bilerman: And then I guess Michael just in terms of capital allocation. I know you spoke a little bit about sort of the potential opportunities out there in the open air side, maybe. But what are you seeing where opportunities come to market at this point, given what interest rates have done, over less. Let's call it 90 days. I think that there's definitely, from a retail fundamental perspective, which is really across all the different formats. There certainly is interest in combined with the overall rate environment. I think that could unlock some opportunities. And we'll speak through the discipline as we go about them.

Speaker Change: Yes, Michael just in terms of capital allocation I know you spoke a little bit about sort of the.

Speaker Change: Central opportunities out there in the open air side, maybe but what are you seeing more opportunities come to market at this point given given what you know what interest rates have done over the last let's call. It 90 days.

Speaker Change: I think that there is definitely from a retail fundamental perspective, which is really across all the different formats.

Speaker Change: He is interested in combined with the overall.

Speaker Change: Rate environment.

Speaker Change: I think that could unlock some opportunities.

Speaker Change: On speed.

Speaker Change: As we go about them.

Michael Bilerman: And expect more stuff. Hopefully we'll be on the market and we have a big blue sufficient.

Speaker Change: Hum.

Speaker Change: Expect ore stockpiles will be on the market and more of a big decision.

Caitlin Burrows: Our next question is from Caitlin Burrows with Goldman Sachs. Please proceed. Hi, good morning. Maybe just some follow-up on topics that we've broadly touched on. But given the focus on replacing or downsizing some underperforming tenants, I was surprised to see the leasing activity page showed the number of retentative leases was seem pretty similar to a year ago, although the square footage was up, maybe parts that were just halfway through the year.

Michael Bilerman: And expect more stuff, hopefully, will be on the market, and we have a big decision. Our next question is from Caitlin Burrows with Goldman Sachs. Hi, good morning.

Speaker Change: Our next question is from Caitlin Burrows with Goldman Sachs. Please proceed.

Stephen Yalof: Maybe just some follow-ups on topics that we've broadly touched on. But given the focus on replacing or downsizing some underperforming tenants, I was surprised to see the leasing activity page showed that the number of re-tenanted leases seemed pretty similar to a year ago. Although the square footage was up, maybe parts that were just halfway through the year. But can you talk about what that year-to-date retention has been? And actually, how does the downsize fit into that? But also, the timeline of when you started taking a tougher stance on renewals, then you start signing those leases, and the ultimate opening, like, have we started to see that yet? Or not quite?

Hi, Good morning, maybe just some follow ups on topics that mean Friday touched on but given the focus on replacing or downsizing.

Speaker Change: Underperforming tenants I was surprised to see the leasing activity page shows the number of re tenanted Lisa.

Speaker Change: Pretty similar to a year ago, although the square footage wise that maybe parts that we're just halfway through the year, but can you talk about what that year to date retention has been and actually how does the downsides fit into that but then also the timeline of when you started taking a tougher stance or anywhere else.

Steven Yala: But can you talk about what that year-to-date retention has been and actually had a downside fit into that, but then also the timeline of when you started taking a tougher stance on renewals, then you start finding those leases and the opening might have we started to see that yet or not quite. Well, we talked about our retention rates in 22 and our 21, 22 going into 23 probably being around the 95% level. I mean most retailers don't want to close a story that's cash flowing positively that they've already made that investment in the store. And you have to take that positive cash flow and replace it someplace else is going to require capital in order to do so. Because of that, we've been very satisfied with a high retention rate because we're able to push our rents 10, 12% to a lot of those retailers to stay. On the flip side, on a retaining basis, where our spreads are significantly higher.

Speaker Change: We start signing those leases and the ultimate opening like have we started to see that yet or not quite.

Stephen Yalof: Well, we talked about our retention rates in 22, in our 21, 22, going into 23, probably being around the 95% level. I mean, most retailers don't want to close a store that's cash flowing positively because they've already made that investment in the store. And, you know, if they have to take that positive cash flow and replace it someplace else, it's going to require capital in order to do so.

Speaker Change: Well, we've talked about our retention rates in 'twenty, two and our 'twenty, one 'twenty two going into 'twenty, three probably being around the 95% level I mean, most retailers don't want to close the story, that's cash flowing positively that they've already made that investment in the store and they have to take that positive cash flow and replace with some.

Speaker Change: Place else, it's going to require capital in order to do so.

Stephen Yalof: Because of that, we've been very satisfied with a high retention rate because we're able to push our rents 10, 12% from a lot of those retailers to stay. On the flip side, on a re-tenanting basis... Where our spreads are significantly higher, we have a team here who's playing the long game, who understands that from a supply and demand point of view, there's not a tremendous amount of space and outlet centers available for leasing, and that there are a number of tenants that are demanding space in our shopping centers.

Speaker Change: Noted that we've been very satisfied with a high retention rate because we were able to push our rents 10% to 12% from a lot of those retailers to stay.

Speaker Change: On the flip side on a retention basis.

Speaker Change: Where our spreads are significantly higher.

Steven Yala: We as a team here who's playing the long game has understood that from supply and their point of view is not a tremendous, not a space and outlet centers available for leasing. That there's a number of tenants that are demanding space in our shopping centers. Because of that, we have an opportunity in time right now to really add exciting tenants and branch to our centers, but do so at rents considerably higher than the retailers that they're replacing. With that said, we have a strategy now in mind of pushing new brands or requiring that existing brands who aren't as productive as they might have been in the past either invest in their stores.

Speaker Change: The team here who's playing the long game.

Speaker Change: I had understood that from supply point of view is not a tremendous amount of space and outlet centers available for leasing.

Speaker Change: There's a number of tenants that are demanding space in our shopping centers because of that we have a opportunity in time right now to really add exciting new tenants and brand store centers, but do so at rents considerably higher than the retailers that they are replacing with that said we have a strategy now in mind.

Stephen Yalof: And because of that, we have an opportunity at this time right now to really add exciting new tenants and brands to our centers, but do so at rents considerably higher than the retailers that they're replacing. With that said, we have a strategy now in mind of pushing new brands or requiring that existing brands, who aren't as productive as they might have been in the past, either invest in their stores or downsize because we believe a lot of brands that might be oversized in our portfolio are still very viable, by downsizing their brands or their store footprints can be as productive, if not more so, in a much smaller footprint.

Speaker Change: Pushing new brands or requiring that existing brands, who aren't as productive as they might have been in the past either invest in their stores downsize because we believe a lot of brands that might be oversized in our portfolio. There is still very viable by downside.

Steven Yala: Downside because we believe a lot of brands that might be oversized in our portfolio, they're still very viable. By downsizing their brand or their store footprint, it can be as productive as, if not more so, in a much smaller footprint.

Brad: In there Brad.

Their store footprint can have can be as productive if not more so than a much smaller footprint. So with our retention our re sizing are replacing with necessary strategy, we're only going to increase the number of store opportunities for the customer to shop when they visit us.

Steven Yala: Fred. So, with our retention, our resizing, our replacing with necessary strategy, we're only going to increase the number of store opportunities for the customer to shop when they visit us, increase the variety of stores in our footprint, push rents, and grow productivity on an organic basis, and we think there's a lot of room for growth there. The ability to do that depends on the leasing pipeline, and I feel like so far in the call you guys have given a few points of commentary on making it seem like there is that opportunity. And as somebody asked this before, I had prompted new leases, and you said the discussions, at least the answer was yes.

Stephen Yalof: So with our retention, our resizing, our replacing with the necessary strategy, we're only going to increase the number of store opportunities for the customer to shop when they visit us, increase the variety of stores in our footprint, and push rents and grow productivity on an organic basis. And we think there's a lot of room for growth.

Increased.

Ivy its stores in our footprint.

Brad: Push rents and grow productivity on an organic basis, and we think there's a lot of room for growth there.

Stephen Yalof: And obviously, the ability to do that depends on the leasing pipeline. And I feel like, so far in the call, you guys have given a few points of commentary to make it seem like there is that opportunity. I know somebody asked if Sephora had prompted new leases, and you said the discussions, at least the answer was yes. But I guess, are there any other stats that you or anybody else could provide to talk about the leasing pipeline?

Speaker Change: Got it and obviously the ability to do that depends on our leasing pipeline and I feel like so far in the call you guys have given a few points.

Speaker Change: Plenty of commentary I'm, making it seem like there is that opportunity I know somebody asked this before I had content new leases and you said that right.

Speaker Change: Discussions at least the answer was yes, but I guess is there any other.

Steven Yala: But I guess, is there any other stats that you or anybody else could provide to talk about the leasing pipeline. And when you do have a vacancy or a location that you're trying to backfill, like is there necessarily competition for that space? I guess that it totally depends on the exact center in the space, but is there generally competition or how are you seeking that new user and like how deep is that pool that you're going to and it's receptive to that interest in the space. Yeah, well, again, if there's competition, there is. There's always been competition from the incumbent in the space who wants to stay.

Speaker Change: Is that you or anybody else could provide to talk about the leasing pipeline and when you do have a vacancy or a location that youre trying to Ah that felt like is there necessarily competition for that space I got that it totally depends on the exact centre in the space, but it doesn't really competition or how are you speaking that you use there and like how deep is that pool that you're going to.

Stephen Yalof: And when you do have a vacancy or a location that you're trying to backfill, is there necessarily competition for that space? I get that it totally depends on the exact center of the space, but is there generally competition, or how are you seeking that new user? And how deep is that pool that you're going to, and who's receptive to that interest in the space?

Speaker Change: It's we're receptive to that interest in the space.

Stephen Yalof: Yeah, well, again, if there's competition, there is, there's always going to be competition from the incumbent in the space who wants to stay. And you know, it's going to be up to us and our leasing strategy to try and fill that space with either a better-producing retailer that has a tremendous amount of variety. You know, as we look at the retailers that are available to choose from that want to be in our shopping centers, you know, where we were in the past pure play outlet.

Speaker Change: Yeah, well again, if there is competition there is there's always going to be competition from the incumbent in the space, who wants to stay and it's going to be up to us in our leasing strategy to try and fill that space with either.

Steven Yala: And it's going to be up to us and our leasing strategy to try and fill that space with either a better producing retailer that has a tremendous amount of variety. As we look at the retailers, they're available to choose from that want to be in our shopping centers, where we were in the past pure play outlet, we've now invited other uses, other brands, other types of tenancy into our centers, which dramatically expanded the addressable market for us to seek due tenants to combat. And that is in the entertainment categories, the food and beverage categories. And in the case of us before or in Ulta, categories that really haven't been in this space before, but bring not only a new shopper to our centers, increase the frequency of their visit, and even more importantly, to the earlier point that you made, bring other retailers that might not have considered our space before.

Speaker Change: Better producing retailer that has a tremendous amount of variety as we look at the retailers that are available to choose from that wanted to be in our shopping centers.

Speaker Change: Where are we where we were in the past pure play outlet. We've now inviting other uses other brands other types of tenancy in tourist centers, which.

Stephen Yalof: We've now invited other uses, other brands, and other types of tenancy into our centers, which dramatically expands the addressable market for us to seek new tenants to come in. And that is in the entertainment categories, the food and beverage categories, and, in the case of Sephora or Ulta, categories that really haven't been in this space before but bring not only a new shopper to our centers, increase the frequency of their visit, but even more importantly, to the earlier point that you made, bring other retailers that might not have considered our space before.

Speaker Change: Dramatically expanded the addressable market for us to seek new tenants to come in and that is in the entertainment categories food and beverage category and in the case of a supporter or an ultra categories that really haven't been in this space before but bring not only in new shoppers to our centers.

Speaker Change: <unk> increased the frequency of their visits and even more importantly to the earlier point that you've made but other retailers that might not have considered our space before.

Steven Yala: As far as the stats are concerned, all I can share statistically is that we're seeing retailers come to our platform in numbers we haven't seen in quite some time. There will be strategic about who we select to go where while continuing to drive our rent and drive our recovery numbers so that we can operate our shopping centers in this environment at the highest possible level while growing our ROI. And I think that we're executing on all of those funds.

Stephen Yalof: You know, as far as the stats are concerned, all I can share statistically is that we're seeing retailers come to our platform in numbers we haven't seen in quite some time. You know, we're being strategic about who we select to go where while continuing to drive our rent and drive our recovery numbers so that we can operate our shopping centers in this environment at the highest possible level while growing our NLI. And I think that we're executing on all of those. Our next question is from Mike Mueller with J.P. Morgan, please. Yeah, hi.

Speaker Change: As far as the stats are concerned well all.

Speaker Change: All I can share it statistically is that we're seeing retail retailers come to our platform in numbers, we haven't seen in quite some time, we're being strategic about who we select to go wear while continuing to drive on rent and drive our recover.

Speaker Change: <unk> numbers, so that we can operate our shopping centers in this environment at the highest possible level, while growing our NOI and I think that we're executing on all of those fronts.

Michael Mueller: Our next question is from Mike Mueller with JP Morgan. Please proceed. Yeah, hi. As it relates to acquisitions, you've talked about focusing on properties where you can add a lot of value with your platform. So, out of curiosity, what are the types of centers that you don't think work well in the platform that you tend to pass on?

Speaker Change: Our next question is from Mike Mueller with Jpmorgan. Please proceed.

Michael Bilerman: As it relates to acquisitions, you've talked about focusing on properties where you can add a lot of value with your platform. So out of curiosity, what are the types of centers that you don't think work well on your platform that you tend to pass on? Yeah, Mike.

Mike Mueller: Yeah, Hi, as it relates to acquisitions, you've talked about focusing on properties, where he can add a lot of value with the with your platform out of curiosity. What what are the types of centers that you don't think worked well on the platform that you tend to pass on.

Michael Mueller: Yeah, Mike. and obviously we're within the outlet sector that's straight up for what we do. Our open-air lifestyle centers, similar tenants, similar operations; that's a natural extension. As we think about our agencies, when we can expand the retail pie of what we've already owned, and that provides some ability to have a catchment area.

Mike Mueller: Yes, Mike.

Michael Bilerman: Well, obviously, we're within the output sector. That's straight up for what we do. Our open-air lifestyle centers, similar tenants, similar operations, that's a natural extension as we think about our adjacencies. When we can expand the retail pie of what we've already sold. And, you know, that provides some ability to have a catchment area. Yeah, there are things like we're not gonna do workouts.

Mike Mueller: Well, obviously, we're the.

Mike: The outlet sector.

Mike Mueller: Great up for what we do.

Mike Mueller: Our open air lifestyle centers similar tenants similar operations, that's a natural extension as we think about our adjacencies.

Mike Mueller: When we can expand the retail what we already own.

Mike Mueller: And yeah that.

Mike Mueller: That provides some ability to have a catchment area.

Michael Mueller: There are things like, we're not going to do workouts. We really want to drive value creation in anything that we buy. So we want to try to stick to the retailers that we do business with and try to find those opportunities where our platform can be driven overall. Got it.

Speaker Change: There are things like we're not will work or not gonna do workouts.

Michael Bilerman: You know, we really want to drive value creation in anything that we buy. So, you know, we want to stick to the retailers that we do business with and try to find those opportunities where our platform can be used overall.

Speaker Change: We want to drive value creation in anything that we buy.

Speaker Change: So we want to try to stick to that.

Speaker Change: Retailers that we do business with.

Speaker Change: And trying to find those opportunities where our platform can.

Speaker Change: Can be.

Speaker Change: <unk>.

Speaker Change: Driven overall.

Michael Bilerman: Got it. Okay. And I apologize if I missed this, but are you working on any, I guess, higher probability development opportunities that we could be hearing about in the next year or so? We, you know, we don't want to, we don't, we don't like to talk about our pipeline, but we are very active in the market, in some interesting new markets that we think we can come into and add. We're an operating company, and I think that that's pretty unique in this space.

Michael Mueller: Okay.

Speaker Change #100: Got it okay, and I apologize if I missed this but are you working on any I guess higher probability development opportunities that we could be hearing about say in the next year or so.

Steven Yala: And I apologize if I missed this, but are you working on any, I guess, higher probability development opportunities that we could be hearing about in the next year or so? We don't like to talk about our pipeline, but we are very active in the marketplace right now. In some interesting new markets that we think we can come in and add, we're an operating company. I think that that's pretty unique in this space. We're not coming in and then third-partying out our marketing or releasing our operations. We do all of that stuff ourselves.

Speaker Change #100: We don't want we don't we don't like talking about.

Speaker Change #100: Our pipeline, but we are very active in the marketplace right now and some interesting new markets that we think we can come in and had no.

Stephen Yalof: We're not coming in and then third-partying out our marketing or leasing or operations. We do all of that stuff ourselves. The fact that we've got such a strong team and such a great track record of operations over here at Tanger, there are a number of potential partners that we're in discussions with and working with, with the opportunity of not only the possibility of buying outright and owning or, in some instances, partnering in a JV.

Speaker Change #100: We're an operating company I think that that's pretty unique in this space, we're not coming in and then third partying out our marketing or our leasing of our operations, we do all of that stuff ourselves.

Steven Yala: The fact that we've got such a strong team and such a great track record of operating operations over here at Tanger, there's a number of potential partners that we're in discussions working with in the, with the opportunity of not only the possibility of buying out right and owning or in some instances, partnering in JV. So there's a number of opportunities that have been presented to us that we might not have seen several years ago had we not executed to the Palm Beach project that we work, that we're currently working with Clarion on or the Huntsville Alabama Lifestyle Shopping Center, which was something that certainly a first for us as a platform, but something that we're absolutely know that this operating team can enter Minnesota into.

Speaker Change: Fact that we've got such a strong team in such a great track record of operating operations over here at Tanger.

Speaker Change: There's a number of potential partners that we're in discussions and working with in the.

Speaker Change: Hum.

Speaker Change: With the opportunity of not only the <unk>.

Speaker Change: Possibility of.

Speaker Change: Buying outright owning or in some instances partnering in JV and so there's a number of opportunities that have been presented to us that we might not have seen in.

Stephen Yalof: So there's a number of opportunities that have been presented to us that we might not have seen several years ago had we not executed on the Palm Beach project that we're currently working with Clarion on or the Huntsville, Alabama, Lifestyle Shopping Center, which was something that certainly a first for us as a platform but something that we absolutely know that this operating team could add tremendous value. And our next question is a follow-up from Floris Dijkum on Compass.

Speaker Change: Several years ago had we not executed to the Palm Beach project that we were that we're currently working with Clarion on or the Huntsville, Alabama lifestyle shopping center, which was something that.

Speaker Change: Certainly a first for us as a platform, but something that we're absolutely know that this operating team can add tremendous value to them.

Floris Dijkum: And our next question is a follow-up from Flores Van Dyken with Cup Biz Point. Please proceed. Thanks, guys. Just a couple of quick follow-ups. Your 10th percentage historically has been around 10%.

Speaker Change #102: And our next question is a follow up from Floris Van <unk> with Compass point. Please proceed.

Stephen Yalof: Thanks, guys. Just a couple of quick follow-ups. Your 10th percentage historically has been around 10%. Is that still at those elevated or more elevated levels, or is it subsiding closer to 5%, which I think is your long-term historical average?

Speaker Change #105: Thanks, guys.

Speaker Change #105: Just a couple of quick.

Speaker Change #105: Quick follow ups that you or Tim percentage historically, it's been around a 10% is that still at those elevated or more elevated levels or is it is it subsiding closer to the 5%, which I think is what your long term historical average has been.

Steven Yala: Is that still at those elevated or more elevated levels, or is it subsiding closer to the 5%, which I think is what your long-term historical average has been? But 10th leasing to strategy for us when we brought the 10th leasing responsibility in house to each one of our general managers and all of our shopping centers, we've increased the number of people that are thinking about 10th leasing. Embedded in those 10th leasing numbers, even at that 10% number, is frictional vacancy between a retailer leading a space and when the new retailer is going to occupy that space.

Stephen Yalof: Look, temporary leasing is a strategy for us. When we brought the temporary leasing responsibility in-house to each one of our general managers and all of our shopping centers, we've increased the number of people that are thinking about temporary leasing. Embedded in those temporary leasing numbers, even at that 10% number, is frictional vacancy between a retailer leaving a space and when the new retailer is going to occupy that space. It's incumbent on that management team in each one of our shopping centers to keep that space occupied.

Speaker Change #106: Well hopefully it seems the strategy for us when we brought the temp leasing.

Speaker Change #108: Responsibility in house to each one of our general managers and all all of our shopping centers. We've increased the number of people that are thinking about temp leasing embedded in those terms leasing numbers, even at that 10% number.

Speaker Change #105: Is frictional vacancy between.

Speaker Change #105: Our retail I'm, leaving the space and when the new retailers going to occupy that space. It is incumbent on that management team in each one of our shopping centers to keep that space occupied.

Steven Yala: It's incumbent on that management team in each one of our shopping centers to keep that space occupying. Page, and so whether it's a local retailer or one of the seasonal retailers that are national in school, that travel our shopping centers from center to center or space to space, we're going to keep that space occupied. So if there's one square foot of vacancy or opportunity in our center, we're going to try and keep that occupied by a temporary tailor. And I think increasing our permanent occupancy, but again, there's always going to be some fictional vacancy, and we're always going to keep that occupied.

Stephen Yalof: And so whether it's a local retailer or one of the seasonal retailers that are national in scope, that travel our shopping centers from space, from center to center or space to space, we're going to keep that space occupied. So if there's one square foot of vacancy or opportunity in our center, we're going to try and keep that occupied by a temporary retailer. And I would say we're doing a great job of increasing our permanent occupancy.

Speaker Change #105: And so whether it's the local retailer or one of the seasonal retailers that are national in scope.

Speaker Change #102: Travel our shopping centers from space.

Speaker Change #108: Centered et cetera, the space to space, we're going to keep that space occupied so if theres a one square foot of.

Speaker Change #106: Vacancy or opportunity in our center, we're going to try and keep that occupied by attempt retailer and I would say, we're doing a great job of increasing our permanent occupancy, but again, there's always going to be some frictional vacancy and were always going to keep it keep the unoccupied.

Stephen Yalof: But again, there's always going to be some frictional vacancy, and we're always going to keep that occupied, right? That doesn't quite get to the answer I was hoping to get, but I understand the strategy. Another question, perhaps, in terms of how you define 95% retention, which is very high, obviously. When you downsize a tenant, does that count as a retained tenant? Nope. When we downsize a tenant and move them to another location, it's a new lease. It's a new deal. Our next question is a follow-up from Caitlin Burrows with Goldman Sachs. Hi.

Steven Yala: Right, that doesn't quite get to the answer I was hoping to get, but I understand the strategy. Another question, perhaps in terms of how you define your 95% retention, which is very high, obviously. When you downsize a tenant, does that count as a retained tenant?

Speaker Change #106: Right that doesn't quite get to the answer I was hoping to get but I understand the strategy.

Speaker Change #105: Another question.

Speaker Change #105: Question, perhaps in terms of your how do you define your 95% retention.

Speaker Change #109: Which is very high obviously when.

Speaker Change #119: When you downsize of tenants does that count as a retained tenants.

Steven Yala: No, when we downsize a tenant and move them to another location, it's a new deal.

Speaker Change #114: No when we downsize attendant and move them to another location that's movies.

Speaker Change #105: Thank you.

Caitlin Burrows: Our next question is a follow-up from Caitlin Burrows with Goldman Sachs. Please proceed. Hi, this might be able to be answered when we go back to the transcripts, but in case it's not, I figured I'd ask again. But just in terms of express, but I think it might actually be more related to Route 21, what you were talking about. It sounds like they had all the original stores in the portfolio. It sounds like you took a total of four back or got four back. But the other route stores, it sounds like maybe they closed and they're reopening, but can you just flush that out a little bit about where you started kind of in between.

Speaker Change #105: Our next question is a follow up from Caitlin Burrows with Goldman Sachs. Please proceed.

Stephen Yalof: This might be able to be answered when we go back to the transcripts, but in case it's not, I figured I'd ask again. But just in terms of Express, but I think it might actually be more related to Route 21, what you were talking about. It sounds like they had all the original stores in their portfolio. It sounds like you took a total of four back or got four back. But the other Roux stores, it sounds like maybe they closed and are reopening. But can you just flesh that out a little bit about where you started, kind of the in-between, and then the outcome later in the year, the moving pieces there?

Caitlin Burrows: Hi, this might be April to be answered when we go back to the transcripts, but in case that is not I figured I'd ask again, but.

Speaker Change #109: But just in terms of express, but I think it might actually be more related to 'twenty. One what you were talking about it sounds like they had all the original stories in the portfolio.

Speaker Change #109: It sounds like you took a total of four backer got far back, but the other various stores. It sounds like maybe that closed and they're reopening but can you just flesh that out a little bit about where you started kind of in between and then the outcome later in the air the moving pieces there.

Steven Yala: And then the outcome later in the years, the moving cases there. Well, the express stores, all but one, remained open. The route stores all closed on the 20 to we took back the other 18. Over half of them have reopened already, the balance of which will open by the end of the year. Got it.

Stephen Yalof: The Express Stores All but one remained open. The Rooster stores are all closed, out of 20. Two; we took that one. The other 18. Over half of them have reopened already, the balance of which will open by the end of the year. Thank you. With no further questions in the queue, we will conclude today's conference. You may disconnect your lines at this time, and thank you for your participation. Steven Tanger, Craig Mailman, Samir Khanal, Doug McDonald, Greg McGinniss, Jeffrey Spector, and Andrea Levin. [inaudible] Craig Mailman, Samir Khanal, Doug McDonald, Greg McGinniss, Stephen Yalof, Doug McDonald,??

Speaker Change #105: Well the the express stores.

Speaker Change #105: Although one remained open.

Speaker Change #105: <unk> stores.

Speaker Change #109: All closed.

Speaker Change #105: The 'twenty.

Speaker Change #105: Two we took back the other 18.

Speaker Change #115: Over half of them are reopened already the balance of which will open by the end of the year.

Unknown Executive: Thank you.

Speaker Change #112: Got it thank you.

Speaker Change #112: Yeah.

Unknown Executive: With no further questions in the queue, we will conclude today's conference. You may disconnect your lives at this time, and thank you for your participation. Thank you. .

Speaker Change #118: With no further questions in the queue. We will conclude today's conference you may disconnect. Your lines at this time and thank you for your participation.

Speaker Change #105: [music].

Speaker Change #105: Okay.

Speaker Change #105: Okay.

Speaker Change #105: [music].

Speaker Change #105: Yeah.

Speaker Change #105: Yeah.

Speaker Change #105: Okay.

Speaker Change #105: Okay.

Speaker Change #105: [noise].