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    SKT
    Earnings call· Mar 2026(Q1 FY26)

    TANGER Q1 FY26 earnings call SKT

    May 1, 2026 Source

    Executive summary

    Tanger Inc. Q1 FY26 — Strong FFO Growth and Increased Full-Year Guidance

    Tanger Inc. delivered a strong Q1 FY26, driven by robust leasing activity, increased sales productivity, and strategic remerchandising efforts, leading to an 11% core FFO per share increase and an upward revision of full-year guidance. The company continues to leverage its open-air centers and value proposition, focusing on tenant mix evolution and strategic partnerships to drive long-term NOI growth, while maintaining a conservative balance sheet and high liquidity.

    Highlights

    5

    • Core FFO increased 11% year-over-year to $0.59 per share.

    • Occupancy ended the quarter at 97%, up 120 basis points year-over-year.

    • Sales productivity increased to $482 per square foot on a trailing 12-month basis.

    • Executed 651 leases totaling 3.4 million square feet in the last 12 months, representing record production.

    • Announced a 7% increase in the dividend, supported by earnings growth and conservative payout ratios.

    Concerns

    3

    • Q1 same-center NOI growth was impacted by elevated snow removal costs, reducing it by approximately 100 basis points or $0.01 per share.

    • The company anticipates Q2 to bear the brunt of recent tenant bankruptcies (Any Bower, Francesca's, Saks) before recovery in the second half of the year.

    • An uncertain macro environment, including potential for sustained higher gas prices, could impact customer demand, though resilience has been noted.

    Guidance & targets

    2
    CategoryTargetConfidence
    Core FFO per share
    $2.42 to $2.50
    high materiality
    High
    Same-center NOI growth
    2.25% to 4.25%
    high materiality
    High

    Operational metrics

    25
    Core FFO per share
    $0.59up 11% YoY
    Q1 FY26

    Predominantly driven by solid internal growth, contributions from recently acquired centers, and modestly higher lease termination income.

    Occupancy rate
    97%up 120 bps YoY
    Q1 FY26 end

    Sequential change due primarily to seasonal patterns; strategic handling of closures with backfill deals in pipeline.

    Sales productivity
    $482increased
    TTM

    Contributed to increased sales productivity across the portfolio.

    Occupancy Cost Ratio (OCR)
    9.7%stable
    Q1 FY26

    Provides additional room for rent growth; stayed flat while sales performance increased.

    Dividend increase
    7%
    April 2026

    Supported by earnings growth and conservative payout ratios.

    Leases executed
    651record production
    last 12 months

    Reflects strong retailer interest across the portfolio.

    Blended rent spreads
    10.5%ongoing strength
    TTM

    Reflects ongoing strength with retenanting spreads exceeding 26%.

    Retenanting spreads
    >26%
    TTM

    Far higher than renewal spreads, driving strategy to replace underperforming retailers.

    On-center events and activations
    >200
    Q1 FY26

    Community engagement events enhancing customer experience, visit frequency, and dwell time.

    AI chatbot customer inquiries handled
    >80%
    current

    Servicing shoppers, suppliers, and tenant retailers around the clock, saving time and increasing productivity.

    Net debt to adjusted EBITDA
    4.8x
    Q1 FY26 end

    Remains below peers and targets, benefiting from strong continued EBITDA growth.

    Weighted average interest rate (debt)
    ~4%
    Q1 FY26 end

    All debt is at fixed rates, inclusive of swaps.

    Weighted average term to maturity (debt)
    ~4.5 years
    Q1 FY26 end

    Once upcoming near-term maturities are addressed.

    Dividend payout ratio
    53%
    Q1 FY26

    Below average, retaining additional free cash flow after dividends supporting future growth.

    Immediate liquidity
    >$1 billion
    Q1 FY26 end

    Includes cash on hand, short-term investments, delay draw term loan proceeds, and full availability on lines of credit.

    Portfolio tenant mix (footwear & apparel)
    70%down from 80% in 2019
    current

    Reflects diversification into entertainment, health and beauty, food, and HomeGoods categories.

    Retention rate (2026 roll)
    ~80%lowest in 5-6 years
    FY26

    Strategic decision to take advantage of deep pipeline of new tenants and higher retenanting spreads.

    Snow removal impact on Q1 same-center NOI
    ~100 bpsyear-over-year
    Q1 FY26

    Contemplated in the full-year guidance range.

    Capital deployed
    $800 million
    last 3 years

    Deployed with small amount of equity raised relative to size, leveraging free cash flow and EBITDA growth.

    Leverage deleveraging
    0.5 turn
    last number of years

    Achieved through free cash flow and EBITDA growth.

    Portfolio sales per square foot
    >$84
    current

    Despite low OCR, indicates continued opportunity to drive revenue.

    Debt maturity: Unsecured bonds
    $350 million
    September 2026

    Upcoming maturity that the company is prepared to address with its liquidity.

    Debt maturity: Mortgage in Kansas City
    $115 million
    late 2027

    Upcoming maturity that the company is prepared to address with its liquidity.

    Debt maturity: Unsecured bonds
    $300 million
    summer 2027

    Significant maturity after the September 2026 bonds and Kansas City mortgage.

    Renewals done (of 2026 roll)
    67%
    current

    Strategic and surgical approach to focus on new business with tremendous demand.

    Industry KPIs

    2
    MetricValueDetails
    Lease termination incomemodestly higherqualitative
    Rent recapture rate on renewals re leasing10.5% blended, >26% retenanting%

    Deals & partnerships

    2
    Unrivaled Sports (Ripken Experience)Exclusive shopping center partner for youth sports experiences

    Tanger centers are on the itineraries of thousands of young athletes and their families, providing shopping, dining, and entertainment options.

    UndisclosedAcquisition of a pad site at Legends (Kansas City)

    Closed on a pad right at the entry of the Legends center, which hosts an existing restaurant.

    Capital programs

    3
    Foley, Alabama center remodel and redevelopmentunderway

    Benefit: enhanced customer experience, support leasing momentum and drive continued sustainable NOI growth

    In the process of doing a remodel and redevelopment of that center due to significant permanent population growth over the last 4-5 years, adding additional uses like restaurants and entertainment.

    National Harbor future developmentunderway

    Benefit: Leveraging proximity to the Sphere being built on adjacent property at the MGM.

    Working with co-owning partners on future development at National Harbor.

    Glendale asset land developmentcompleted

    Benefit: Fully brought online with a multi-tenant building, adding new food and beverage and entertainment opportunities adjacent to State Farm Arena and Glendale Entertainment District.

    Acquired a large chunk of ADOT land immediately adjacent to the Glendale asset and fully brought the space online.

    Risks & headwinds

    4
    Elevated snow removal costsQ1 FY26

    Impacted Q1 same-center NOI by ~100 bps / $0.01 per share.

    Mitigation: Costs were contemplated in the full-year guidance range provided previously.

    Uncertain macro environmentOngoing

    Potential for sustained higher gas prices impacting demand for shopping at centers.

    Mitigation: Customer resiliency noted; centers increasingly serve local shoppers, mitigating gas price impact; value proposition resonates with aspirational customers.

    Tenant bankruptcies and closuresQ2 FY26

    Impact from Any Bower, Francesca's, and Saks expected to be most significant in Q2.

    Mitigation: Full-year guidance range already contemplates a range of credit outcomes; backfill deals (permanent or short-term temp) are already in place for much of the space.

    Competitive acquisition environmentOngoing

    The market for acquisitions is competitive.

    Mitigation: Focus on unique assets where Tanger's platform can add value; significant liquidity (over $1 billion) allows capital deployment without needing to raise additional equity at this juncture.

    What to watch in Q2 FY26

    5

    Same-center NOI growth

    Next quarter (Q2 FY26)
    Current2.6% (Q1, ex-LTI), ~100 bps impact from snow removal
    TargetRecovery from Q2 impact, progress towards 2.25%-4.25% full-year guide

    Why it matters

    Key organic growth driver, Q2 is expected to bear the brunt of recent tenant bankruptcies before recovery in the second half.

    Our guidance range of 2.25% to 4.25% still contemplates and takes into account all of these risks. And I would just say from a cadence perspective, we would expect 2Q to have most of the brunt of that those tenants have come out, we put temper firm as those come into the back half of the year.

    Q&A highlights

    6

    Can retenanting spreads remain in the mid-20% range, and what is the current retention rate and future strategy?

    Management is optimistic about maintaining strong retenanting spreads due to sales performance. The current retention target for the 2026 roll is about 80%, the lowest in 5-6 years, as the company prioritizes higher retenanting spreads over renewals.

    “Our current retention, we're anticipating about 80% of our to renew about 80% of our roll this year, which is probably the lowest it's been in the past 5 or 6 years. just because we see great upside and great opportunity.”

    asked by Andrew Reale · answered by Stephen Yalof

    2 min read5 chapters

    Detailed Narrative

    01

    Leasing and Merchandising Strategy

    Tanger continues its strategy of replacing underperforming retailers with more productive concepts, driving traffic and sales. This is reflected in record leasing production, with 651 leases totaling 3.4 million square feet executed in the last 12 months, and strong retenanting spreads exceeding 26%. The company is intentionally renewing fewer tenants, targeting an 80% retention rate for its 2026 roll, to capitalize on new demand and leverage higher retenanting spreads.

    02

    Marketing and Strategic Partnerships

    The company's marketing platform serves as a key differentiator, expanding reach and growing its proprietary loyalty program. Over 200 on-center events and activations in Q1 alone enhanced customer experience and traffic. A significant partnership with Unrivaled Sports (Ripken Experience) is driving sports tourism to Tanger centers, with food and beverage and entertainment options catering to these visitors, playing perfectly into the company's strategy to enhance customer dwell time and visits.

    03

    Technology and Operational Efficiency

    Tanger is increasingly leveraging technology to support and enhance its platform, enabling AI across the organization to improve workflow and drive operational efficiency. An example is its multilingual AI chatbot, which now handles over 80% of customer inquiries, servicing shoppers, suppliers, and tenant retailers around the clock, thereby saving time, money, and increasing productivity.

    04

    Balance Sheet Strength and Capital Allocation

    The company maintains a strong balance sheet with a low net debt to adjusted EBITDA ratio of 4.8x at quarter-end and over $1 billion in immediate liquidity. This provides significant flexibility for portfolio investments, selective external growth opportunities, and addressing upcoming debt maturities, including $350 million of unsecured bonds due in September and the potential early redemption of a $115 million mortgage in Kansas City.

    05

    Market Dynamics and Growth Outlook

    Favorable market conditions, supported by growing local populations, limited new retail development, and consolidation in the department store business, continue to contribute to broad and diversified leasing demand across Tanger's portfolio. The company's open-air centers, compelling brand mix, and focus on value position it well across economic cycles, creating an engine for sustained long-term growth.

    AI-generated summary of the company’s earnings call. Not investment advice.