Seeking Alpha
We cover over 5K calls/quarter
Profile| Send Message| ()  

Executives

Mona Walsh – Director of Corporate Communications

Steven Tanger – President and CEO

Frank Marchisello – EVP and CFO

Analysts

Lindsay Schroll – UBS

Christine Mcelroy – Bank of America

Manny (ph) – Citi Investment Research

Michael Mueller – JPMorgan

Dave Fick – Stifel Nicolaus

Nathan Isbee – Stifel Nicolaus

Shane Buckner – Wells Capital Management

Carol Kemple – Hilliard Lyons

Ben Yang – Keefe, Bruyette & Woods

Cedrik Lachance – Green Street Advisors

Rich Moore – RBC Capital Markets

Tanger Factory Outlet Centers, Inc. (SKT) Q1 2010 Earnings Call April 28, 2010 11:00 AM ET

Operator

Good morning. My name is Latoya and I will be your conference operator today. I would like to welcome everyone to the call. I will now turn the call over to Ms. Mona Walsh, Director of Corporate Communications.

Mona Walsh

Good morning and welcome to the Tanger Factory Outlet Centers’ first quarter 2010 conference call.

Please note that during this conference call some of management's comments will be forward-looking statements regarding the company's property operations, leasing, tenant sales trends, development, acquisition, expansion and disposition activities, as well as their comments regarding the company's funds from operations, funds available for distribution and dividends.

These forward-looking statements are subject to numerous risks and uncertainties and actual results could differ materially from those projected due to factors including, but not limited to, changes in economic and real estate conditions, the availability and cost of capital. The company's ongoing ability to lease, develop and acquire properties, as well as potential tenant bankruptcies and competition.

We direct you to the company's filings with the Securities and Exchange Commission for a detailed discussion of the risks and the uncertainties.

This call is being record 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 maybe accurate only as of today's date, April 28th, 2010.

At this time, all participants are in listen-only mode. Following management's prepared comments, the call will be opened up from your questions.

On the call today will be Steven Tanger, President and Chief Executive Officer; and Frank Marchisello, Executive Vice President and Chief Financial Officer.

I will now turn the call over to Steven Tanger. Please go ahead, Steve.

Steven Tanger

Thank you, Mona, and good morning, everyone. Our first quarter results came in strong with funds from operation increasing by 17.4%. The retail sector is growing as we had anticipated when compared to last year. Benefiting from strong March results and aided by the early Easter holiday shift, our tenant comparable sales for the rolling 12 months ended March 31, 2010 increased 3.1% to $342 per square foot. Sales for the first quarter increased 10.3% compared to the first quarter of 2009.

We are pleased to announce on April 8th that our Board of Directors approved an increase in our annual cash dividend rate from $1.53 to $1.55 per share. Our budget for 2010 currently anticipates yearend funds available for distribution ratio in the mid 60% range. That means our existing cash dividend is over 150% covered from operating cash flow and that we do not use our lines of credit to fund our cash dividend. We are very product of the fact that we have raised our cash dividend in each of the 17 years since becoming a public company in 1993.

One of the reasons investors buy REIT stock and Tanger is the expectation of a total return including a cash dividend.

I will now turn the call over to Frank, who will take you through our financial results for the quarter. And then I will follow with a summary of our operating performance and our current expectations for the balance of 2010.

Frank Marchisello

Thank you, Steve, and good morning, everyone. Total funds from operations or FFO for the quarter ended March 31st, 2010 increased approximately 17.4% for the period. FFO per share decreased approximately 4.5% to $0.63 per share compared to $0.66 per share in the quarter ended March 31st, 2009.

The decrease in FFO per share was due to the issuance of 8.3 million additional common shares associated with the two successful equity transactions completed during 2009. More information on these transactions may be found in our Form 10-K for the year ended December 31st, 2009.

On a consolidated basis, our total market capitalization at March 31st, 2010 was approximately $2.7 billion and our debt to total market capitalization was approximately 21.9%. We also maintained a strong interest coverage ratio of 4.82 times for the quarter.

As of March 31st, 2010 approximately 84% of our debt was at fixed rates. Our only floating rate debt was $93.4 million outstanding on our $325 million in unsecured lines of credit. Our balance sheet strategy has always been conservative with a manageable debt maturity schedule.

At the end of the first quarter, our wholly-owned portfolio of properties was 100% and encumbered and we had no outstanding maturities until June of 2011. Our FFO payout ratio for the first quarter was approximately 61% and our FAD payout ratio was about 65%. At these levels, our dividend is well covered and we will generate incremental cash flow over our dividend which we plan on using to help fund our new development and maybe North Carolina and reduced amounts outstanding on our lines of credit.

I will now turn the call back over to Steve. Go ahead, Steve.

Steven Tanger

Thank you, Frank. I am pleased to report that so far this year we continue to see positive rent spreads on the renewal and releasing of space within our portfolio. Our average cost occupancy for 2009 was 8.5% of average tenant sales, which should provide us the opportunity to raise rental rates on the leasing and renewal of space in the near future. We have already made good progress on our 2010 renewals throughout our wholly-owned portfolio.

As of the end of March, we obtained executed renewals and renewals in process for 705,000 square feet or about 47.5% of the space, coming up for renewal during 2010 with an increase in average based rental rate on the executed renewals 8.8%. These results fall in line with what we had anticipated in the fourth quarter of 2009 with the potential for an uptick in leasing spreads in the second half of 2010.

In addition, during the first quarter, we re-tenanted approximately 228,000 square feet with an increased in average based rental rates of 22.5%. Our low cost of occupancy and increasing sales allow us the opportunity to continue to drive up rents. Combined, re-tenanted and renewed rents are 12.4% higher than last year. Same center NOI growth during the quarter was 0.7% compared to 0.3% in the fourth quarter of 2009.

Our overall occupancy rate for our wholly-owned stabilized properties was 94.8% at the end of the first quarter compared to 93.5% last year. In the first quarter of 2010, not a single tenant in our portfolio declared bankruptcy.

Reported tenant comparable sales within our wholly-owned portfolio increased 3.1% for the rolling 12 months ended March 2010, to $342 per square foot. Sales for the first quarter increased 10.3% compared to the first quarter of 2009. As we had anticipated, retail sales have come back, inventories are right sized, and the retail sector is growing when compared to last year.

First quarter sales also benefited from an early Easter holiday calendar shift. Percentage rents which are paid by tenants once their total sales exceed certain levels, represent less than 3% of our expected total revenue during 2010.

Approximately 91% of our total revenues are expected to be derived from contractual based rents and tenant expense reimbursements. In addition, no single tenant accounts for more than 8.4% of our gross leasable area or 5.3% of our base and percentage rents. Most of our tenants have very strong balance sheets.

For almost 30 years, we have successfully developed factory outlet centers. We are proud of our track record of delivering long-term increasing value for our stakeholders.

In the last quarter of 2009, we began construction of our newest center to be located in Mebane, North Carolina. The center is scheduled to open in time for the 2010 holiday season. And with the economy improving, this timeline has encouraged our retail partners to proceed to sign leases now.

We currently have approximately 77% of the space, either leased or with leases out for signature. Among the stores that will open at this outlet or at Banana Republic factory store, Saks Fifth Avenue On Fifth, Coach Factory, Levi’s, GAAP Outlet, J Crew, BCBG, Nike Factory Store, and Tommy Hilfiger, and many more. Our expected initial return on cost is 10% to 10.5%.

Tenant interest continues to be strong. An additional leasing momentum is building for this fabulous site located on the heavily traveled Interstate 85-40 Corridor in the North Carolina. We are also in the process of building our shadow pipeline of potential new developments, should tenant demand continue to escalate. We remain excited about the growth prospects of our industry.

Demolition has commenced to make way for the redevelopment of one of our two centers in Hilton Head, South Carolina. Upon completion, we will have turned what was a very shopper unfriendly center built in 1987 into a new shopper-centric outlet center containing approximately a 176,000 square feet, plus four restaurant land parcel facing the highway, two of which we have already obtained, signed leases from major restaurant food users.

The demolition costs which will be expensed during 2010 amount to approximately $600,000. And the lost net operating income caused by the demolition will amount to approximately $1.4 million. Our expected $50 million investment will create the first LEED certified green shopping center in Beaufort County, South Carolina. The new center is currently scheduled to open in the second half of 2011.

Earlier this year, we were proud to announce that Tanger Outlets at the Arches in Deer Park, New York was certified as a LEED Silver Core and Shell project by the US Green Building Council. This center is the largest and only retail center in the State of New York to achieve a LEED Silver certification for its Core and Shell development.

Recently, the Tanger Outlet Center in San Marcos was named the Best Outlet Shopping Mall in Texas by Media World’s, USA’s Official Best of Texas 2010. The publication’s Best of the series ranks the state’s best loved attractions in a variety of categories.

With respect to earnings guidance for 2010, based on our current view of marketing condition, we believe our estimated diluted net income for 2010 will be between $0.82 and $0.92 per share. And our FFO for 2010 will be between $2.57 and $2.67 per share. In our earnings guidance, we are assuming that same-center NOI grows between 0.5% to 1.5%, while tenant sales will remain at the 2009 levels during 2010.

As a result of the two successful common equity transactions during 2009, our earnings estimate for 2010 also assumes that there will be 46.2 million diluted weighted average common shares outstanding.

Our 2010 guidance includes the full-year impact of the dilution caused by the issuance of 8.3 million common shares associated with the successful share issuances in 2009. Our 2010 earnings estimate does not include any additional rent termination fees, the impact of any potential refinancing transactions, the sale of any outparcels of land or the sale or acquisition of any properties.

We plan to continue to thoughtfully use our resources and to maintain a conservative financial position. Our balance sheet with no upcoming debt until June 2011, puts us in a very strong position this year.

I would like to now open the call to any questions you may have. Operator?

Question-and-Answer Session

Operator

(Operator Instructions). Your first question comes from Lindsay Schroll. Your line is now open.

Lindsay Schroll – UBS

Hi, good morning. I know you talked about tenant demand is increasing. Where do you think Mebane will open in terms of occupancy later this year?

Steven Tanger

It’s hard to case. Right now, we are thrilled to be at 77% pretty leased. We have probably six months before we actually open. We are getting commitments virtually everyday from the tenant community as we closer to the opening date. I would hate to give you any sort of guidance on that. But I am comfortable we will continue to sign leases.

Lindsay Schroll – UBS

Great. And then shifting to Deer Park, how is the leasing coming and the tenant interest in the collection wing? Is there any change of strategy there or any updates?

Steven Tanger

We still think as luxury brands continue to recover, we are in a very fruitful discussions with several luxury brands, and nothing is committed yet. But we continue to have those conservations.

Lindsay Schroll – UBS

Okay, great, thank you.

Operator

Your next question comes from Christine Mcelroy.

Christine Mcelroy – Bank of America

Hi, good morning guys. Last quarter you talked about some of the $600,000 of demolition cost from Hilton Head potentially being in Q1 numbers. Was any of that in there? And would you expect the rest to be expensed in Q2?

Frank Marchisello

There was a small amount in Q1, but the majority of them will end up in the second quarter. That’s correct.

Christine Mcelroy – Bank of America

Okay. And then you had projected G&A to be on average about $6 million per quarter, but that there would be some choppiness I guess related to incremental expenses associated with strategic initiatives. Can you provide any additional color on what those strategic initiatives might be and how we should be thinking about G&A from a timing perspective?

Frank Marchisello

From a timing perspective on the G&A cost, there will be additional incremental costs beyond what was in the first quarter. The first quarter was how light with regard to the initiative cost. We also with the new long-term performance based comp plan did not have a full quarter’s expense of that in the first quarter, so that will also bump up the G&A slightly. So I think the $6 million run rate is still applicable for the rest of the year.

Christine Mcelroy – Bank of America

Is it a run rate or is it sort of an average? So I mean what should we be looking at in terms of second quarter or third quarter?

Frank Marchisello

It is much going to be a run rate from here out. We were kind of came in a little below the $6 million for the Q1. I don’t know that we are going to get caught up and be beyond $6 million for quarter if that’s what you are asking. I think the $6 million is probably a good run rate.

Christine Mcelroy – Bank of America

And in terms of the strategic initiatives, I mean, any additional color on what they might be or timing related to those and announcements?

Steven Tanger

Yes, Christy, we are looking at our entire portfolio and I mean we are going to probably do some things like IT enhancements to provide Wi-Fi service to our customers, which is not currently in place. We may look at other enhancements to our properties. But as we conclude and our Board decides and approves our long-term strategic plan which will include some of these initiatives, we will announce them later this year.

Christine Mcelroy – Bank of America

Okay. And then just lastly, I am wondering do you currently have any involvement with Prime Outlets at the moment?

Steven Tanger

We have no involvement with Prime Outlets at the moment.

Christine Mcelroy – Bank of America

Okay. And then just what’s your sense for how the Prime acquisition will impact the competitive landscape for outlet centers in the US?

Steven Tanger

It’s hard to guess. I honestly don’t know. It would just be shear speculation. I think you probably have to ask the tenants that question.

Christine Mcelroy – Bank of America

Right. Have you had any discussions with tenants regarding their sense?

Steven Tanger

I have.

Christine Mcelroy – Bank of America

Anything you care to share?

Steven Tanger

Not today.

Christine Mcelroy – Bank of America

Thanks.

Steven Tanger

Okay.

Operator

Your next question comes from Quentin Velleley. Your line is now open.

Manny – Citi Investment Research

Hi guys, it’s Manny (ph) here with Quentin. Going back to Deer Park for a second, the 81% occupancy rate that you give in your supplemental, is that all rent paying?

Frank Marchisello

Are you asking if anybody has free rent? The answer would be no.

Manny – Citi Investment Research

Okay. And then looking at the NOI yields for that asset, I seem to be getting a little bit closer to 5.5% versus your target of 8.5%. Could you help me bridge the gap between your target and where we are now?

Frank Marchisello

I mean, it really just comes down to occupancy levels. Every square foot that we increase occupancy level that goes right to the bottom line. So I think as the occupancy increases in Deer Park, we hope that it will throughout the year, you should see the NOI and the return percentage increase.

Manny – Citi Investment Research

But to get to that kind of 8.5% mark, it looks like you are going to have to have rents that are significantly above where they are now. Is that what you are seeing or is there something else that I am missing?

Frank Marchisello

Well it is not only rents, but you are going to increase your recovery rate and other items throughout the property that are going to add incremental value it is not just a base rent number. It is extra charges that right now we are the joint ventures seeing quite a bit of leakage with that regard. So as occupancy increases, you will see that improve as well.

Manny – Citi Investment Research

Okay, thanks, Frank.

Steven Tanger

Manny, I just want to add to that. We have been successful in the first quarter of this year in increasing traffic in Deer Park by close to 20% compared to last year. Sales in March were up significantly. We don’t announce sales per shopping center, but they were up double digit, compared to March of last year. So we are starting to see our marketing programs generate substantial traffic.

Last year in our first full year in a bad economy 7.25 million shopping visits went to Deer Park and we are on track to increase that by double digits this year. So we continue to have very, very robust conservations with our tenants. And as traffic increases and sales increase, we are – we expect additional leases to be signed in the next six to nine months.

Manny – Citi Investment Research

I think on your last call you guys had several LOIs out, any progress on those?

Steven Tanger

We would be happy to let you know when the leases are signed.

Manny – Citi Investment Research

Okay, thank you.

Operator

Your next question comes from Michael Mueller. Your line is now open.

Michael Mueller – JPMorgan

Yes, hi. I guess following up on that prior question, do you think – are we likely to see a mix of tenants coming into Deer Park where it’s maybe bigger space users, like a department store, a larger format tenant, as well as smaller or does it seem like it is going to be skewed to one type more than another at this point?

Steven Tanger

I think you are probably going to see a mix which will be reflective of the market.

Michael Mueller – JPMorgan

Okay. And can you just quantify to some degree the shadow pipeline in terms of over the near term for example, I know we are heading into ICSC, a lot of people tend to announce new projects at this point in time. Is that something that we should or could hear coming out of you and how many other projects are you considering that could start over the next couple of years?

Steven Tanger

We have identified Mike a shadow pipeline including 17 markets around the country that we have determined or either underserved or not served at all by outlet centers. We have our folks travelling around the country trying to identify a specific location and specific sites and get them under control.

We are also working with the tenant community to get their point of view on the sites that we identify. And it is an organized process that’s been going on for probably the last three to six months.

ICSC is not a magic date for us to announce anything. If we are prepared and have a site under control, we will announce it. But we have very close communication with our lead magnet tenants on what we are doing. And they will – when we announce the site it will be with their support.

Michael Mueller – JPMorgan

Okay, I appreciate it. Thank you.

Operator

The next question comes from Nathan Isbee. Your line is now open.

Dave Fick – Stifel Nicolaus

Hi. It’s Dave Fick, also here with Nate Isbee. Steve, I know you have already said you are not involved in the Prime retail transaction. I am also aware that you are probably still under a confidentiality agreement with respect to that transaction. But I am just wondering given that it is very material to the industry and will probably impact you no matter who it ends up with. Can you give us any insight as to what you are hearing about why that may not have closed yet?

Steven Tanger

Dave, thank you for respecting the fact that we are under a confidentiality agreement. I have no firsthand knowledge as to why it has not closed. I think you have to ask the folks involved with that transaction. I candidly don’t know.

Dave Fick – Stifel Nicolaus

Okay, great. Nate has a question.

Nathan Isbee – Stifel Nicolaus

Yes, hi, good morning. You just talked a little bit about Deer Park. Can you just turn to Wisconsin Dells and Pittsburgh. Talk a little bit about – I mean occupancy is clearly up at those two properties. How sales are performing relative to your expectations?

Steven Tanger

Good morning, Nate. Sales are very robust in those two sites. At Pittsburg, we announced recently that we have signed a Saks Off Fifth deal which we are moving rapidly as are they to try to open by Memorial Day.

The traffic in Pittsburgh and in Wisconsin is up significantly. And we expect that sales to continue to follow the traffic and as we continue to lease up. Pittsburg we are hopeful that it will be at or above our company average by the end of the year.

Nathan Isbee – Stifel Nicolaus

And how about the Dells?

Steven Tanger

The Dells is already above our company average, so it continues to do well. It’s a relatively small property and it does well.

Nathan Isbee – Stifel Nicolaus

Okay thank you.

Operator

Your next question comes from Shane Buckner. Your line is now open.

Shane Buckner – Wells Capital Management

Hi. This is Shane Buckner, Wells Capital Management. You mentioned the low occupancy costs. I think you said it was about 8.5% of retail sales, which did not allow for rental increases. At what level does that get too high and caps the built-in rent growth? And also one other question; I think at some point last year Frank, you mentioned that you guys were seeing some new, some interest from retailer and outlet center from retailers who had traditionally shunned the outlet center. And I am just wondering if you were still seeing interest from possibly new tenants?

Steven Tanger

Let me take the questions in a reverse order.

Shane Buckner – Wells Capital Management

Sure.

Steven Tanger

Yes. We continue to see interest from new tenants. As sales recovered and have recovered in the economy, it appears to be recovering. Most of our tenants are going from defense to offense. Most of the folks that run these businesses are paid to grow the business. The outlets as a distribution channel historically has been either the most or one of the most profitable business units of the companies that have outlets. So people that or companies that either have changed managements who are familiar with the outlets as a distribution channel or are now comfortable that the economy has turned and that the outlets will enhance their brand are coming to us to open new stores and that continues almost on a weekly basis. It’s very exciting for us to see the economy to recover this way and it does build more demand for space in our properties.

With regard to your question as to rents being are to a point where they are too high, I don’t really know how to answer that. Our cost of occupancy is about half of the cost of occupancy of some of the regional mall folks. And we as I have mentioned in our presentation earlier have continued to drive rents.

So far the blended rent spread is over 12% which is pretty extraordinary and we are able to do that because we keep our cost down and because the tenants have increased in sales and our distribution channel. So I don’t think we are anywhere near the cost of occupancy number that would bump up against what tenants will consider to be excessive.

Shane Buckner – Wells Capital Management

Okay, great. Thank you.

Operator

Your next question comes from Carol Kemple. Your line is now open.

Carol Kemple – Hilliard Lyons

Good morning. At what point in the year do you expect to start having talks with the banks about your credit lines that will start next year?

Steven Tanger

Everyday, every week. We constantly monitor the credit markets. We have a very close, deep and longstanding relationships with our commercial and our investment banks that we do business with. We are planning sometime this year to refinance both our lines of credit and the outstanding term loan.

Carol Kemple – Hilliard Lyons

And at this point do you think you can get a loan for the same value that you have currently without a problem?

Frank Marchisello

On the line of credit commitment?

Carol Kemple – Hilliard Lyons

Yes.

Frank Marchisello

Yes.

Carol Kemple – Hilliard Lyons

Okay. And then my other question, I know you have talked about this before in the call, but you have talked about your Commerce Georgia, the number one site there. Do you have any plans for that property as far as selling it or any changes to it?

Steven Tanger

We are currently operating the property as if we are going to own it forever.

Carol Kemple – Hilliard Lyons

Okay.

Steven Tanger

We entertain from time-to-time offers to buy the property. And if someone comes to us with a transaction and the financing to be able to complete it, we will certainly listen to it.

Carol Kemple – Hilliard Lyons

Okay, thank you.

Operator

Your next question comes from Ben Yang. Your line is now open.

Ben Yang – Keefe, Bruyette & Woods

Hi, good morning. Just going back to that last question on Commerce Georgia, what’s the story there? I mean, obviously occupancy fell pretty significantly compared to yearend. And I have never been there, but I am kind of curious what’s happening at that center that is leading to that big occupancy decline?

Steven Tanger

Ben, this was a property built as a first-generation outlet in 1988. It is about half a mile off the Interstate in the interchange on the Interstate. So we have been transitioning this from an outlet center. Actually it’s called a town center now, it’s now even called an outlet center. And we are – we have just replaced the theater operator. There is a movie theater there. And with the new operators, sales in the theater are up 25%. But we are transitioning from outlet tenants to more value oriented tenants that may not be outlet stores.

Ben Yang – Keefe, Bruyette & Woods

Okay, very helpful. And then when you look at the occupancy levels of some of our other centers, you had some pretty big swings in occupancy, I think more than what can be explained by typical seasonality after the holidays. Is there anything unusual happening at some of the centers that have lost say 300 to 600 basis points over the past three months?

Frank Marchisello

Ben, this is Frank, and Steve chime in as well if you would like. But if you compare the occupancy and again the Q1 of 2010 and Q1 of ’09, I don’t think you will see the swings that you might think you are seeing. So there is really nothing unusual that’s occurred other than tenants closing typically happening.

Ben Yang – Keefe, Bruyette & Woods

And you include that temp tenant number in the occupancy figure?

Frank Marchisello

At yearend, yes.

Ben Yang – Keefe, Bruyette & Woods

Okay, great, thank you.

Operator

Your next question comes from Cedrik Lachance. Your line is now open.

Cedrik Lachance – Green Street Advisors

Thank you. How many more properties do you think you could redevelop or you could reposition the way you are doing right now in Commerce or the way you are doing at Hilton Head?

Steven Tanger

We don’t think there is any other one in our portfolio that would fall onto those categories.

Cedrik Lachance – Green Street Advisors

Okay. In regards to Deer Park, I know a loan is only maturing about a year from now. But at this point, what are the plans for refinancing? And do you expect to have to inject more equity into the venture?

Steven Tanger

We are in close communications with the banks that hold the mortgage. And we don’t have a resolution to that question yet. As you mentioned, we do have time before the loan matures. But we are planning far and advance and are having very fruitful and very good conservations with the bank lending group.

Frank Marchisello

There is also a one-year extension on that loan from mid 2011 to mid 2012.

Cedrik Lachance – Green Street Advisors

Okay, thank you.

Operator

Your next question comes from Rich Moore. Your line is now open.

Rich Moore – RBC Capital Markets

Yes. Hello, good morning, guys. Maybe it is my imagination, but it seems Steve that on the last call you said Hilton Head was I think 223,000 square feet, the new center or the redeveloped center, and on this one you said 175,000. Could you maybe reconcile that for me?

Steven Tanger

Sure. And your memory is pretty good.

Rich Moore – RBC Capital Markets

Actually I had it written down, so it’s not that good.

Steven Tanger

The difference, we have now broken it out. And I think it was one of your questions when we were together. The outlet center itself is in the 175,000 square foot range. And the square footage permitted for the four outparcels with restaurants makes up the difference.

Rich Moore – RBC Capital Markets

I got you. That makes sense, great. So it’s still 223,000 roughly.

Steven Tanger

In total, including the outparcels.

Rich Moore – RBC Capital Markets

Got you. Okay. And then on the Seymour Indiana property the impairments that you guys had in the quarter I guess I didn't exactly understand. You sold the center in 2005, but I guess must have still retained some interest in the outparcels, is that how that worked?

Steven Tanger

Yes, that’s correct.

Rich Moore – RBC Capital Markets

And do you have any more of those there or is that sort of done?

Frank Marchisello

We have one parcel, Rich. We had land with a book value of about $1 million remaining after we sold the property. We have sold some parcels recently and that provided us more of a market price, so we determined that we should take a write-down on the remaining parcel was about 23 acres and we only have it on the books for a couple of hundred thousand dollars at this point. So that’s all that’s left in Seymour.

Rich Moore – RBC Capital Markets

Okay, great. Thanks Frank, that’s helpful. And then Steve, do you have any thoughts on traffic? I know that you have mentioned in passing the traffic for the first three months of the year and I guess March at the time wasn't finished. But any thoughts on how traffic for March went and maybe what you are seeing for April?

Steven Tanger

We are very pleased with the traffic in March. We don’t announce it for a month, but it was up double digits. We are seeing the traffic and we include March through the 31st of March did not include Easter weekend. April traffic continues to trend up and we – again are driving traffic, consumers are out now shopping in greater numbers than they were a year-ago. And although we don’t have April sales yet, normally sales follow traffic.

Rich Moore – RBC Capital Markets

Okay, good. That makes sense. Yes, thank you. And then, Frank, last thing. On the recovery ratio, it was down this quarter versus first quarter of last year, fourth quarter of last year however you want to look at it, anything special going on in there?

Frank Marchisello

Not really. I think some of it’s timing related. We do allocate some of our termination fees between base rent and recovery revenue. And I think in the previous period that may have been a little higher. And then we probably had additional non-recoverable expenses that may have hit in some of those previous quarters.

Rich Moore – RBC Capital Markets

Okay. So going forward we kind of go back to where we were you think?

Frank Marchisello

I think we are at what we were for Q1 should be fairly close to our run rate.

Rich Moore – RBC Capital Markets

Okay. Alright, very good. Thank you, guys.

Operator

(Operator Instructions). There are no further questions in the queue. I will turn the call back over to you.

Steven Tanger

I want to just take a moment to thank all of you for participating today and your interest in our company. I am also happy to tell you that we went X dividend and so far as of 10:40 this morning, we had already made back the dividend and are up a little bit. So we are always – Frank and I and our team are always available to answer any of your other questions, please give us a call. And have a great day. Thank you.

Operator

This concludes today’s conference call. You may now disconnect.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY’S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY’S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY’S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

Source: Tanger Factory Outlet Centers, Inc. Q1 2010 Earnings Call Transcript
This Transcript
All Transcripts