GREENSBORO, N.C., June 11 /PRNewswire-FirstCall/ -- Tanger Factory OutletCenters, Inc. (NYSE: SKT), today announced it has closed on a $235.0 millionunsecured three year term loan facility. The syndicated facility was jointlyarranged by Banc of America Securities LLC and Wells Fargo Bank, N.A., withBank of America, N.A. serving as Administrative Agent and Wells Fargo Bank,N.A. serving as Syndication Agent. The facility bears interest at a spreadover LIBOR of 160 basis points, with the spread adjusting over time, basedupon the debt ratings of the company. Tanger currently maintains investmentgrade ratings with Moody's Investors Service (Baa3 stable) and Standard andPoor's Ratings Services (BBB- positive).
Proceeds from the offering will be used to repay the company's onlyremaining mortgage loan with a principal balance of approximately $170.7million. Upon the repayment of this mortgage, which is expected to occur bythe end of June 2008, Tanger's entire portfolio of wholly-owned propertieswill be unencumbered. The remaining proceeds of approximately $62.8 million,net of closing costs, will be applied against amounts outstanding on thecompany's unsecured lines of credit and to settle the interest rate lockprotection agreements discussed below.
'Our team, along with Bank of America and Wells Fargo Bank, have done atremendous job coordinating the funding and closing of this unsecured termfacility,' stated Stanley K. Tanger, Founder, Chairman of the Board and ChiefExecutive Officer of Tanger. 'Repaying our only remaining mortgage loan hasbeen a priority ever since we assumed the loan with the acquisition of theCharter Oak portfolio in 2003.'
'The syndication of this unsecured term loan has provided us theopportunity to initiate a number of new banking relationships,' commentedSteven B. Tanger, President and Chief Operating Officer. 'In the currenteconomic environment, Tanger has demonstrated it has access to attractivelypriced unsecured capital.'
In conjunction with the closing of the facility, Tanger settled $200million of interest rate lock protection agreements which fixed the USTreasury index at an average rate of 4.62% for 10 years from such date in July2008. The company had originally entered into these agreements in 2005 inanticipation of a public debt offering during 2008, based on the 10 year USTreasury rate. Upon the closing of the LIBOR based unsecured term loanfacility, Tanger determined the likelihood of such a US Treasury based debtoffering to be not probable. The settlement of the interest rate lockprotection agreements, at a total cost of $8.9 million, will be reflected as acharge to earnings in the company's second quarter 2008 operating results andfunds from operations.
Tanger Factory Outlet Centers, Inc.(NYSE: SKT), a fully integrated,self-administered and self-managed publicly traded REIT, presently owns andoperates 29 outlet centers in 21 states coast to coast, totaling approximately8.4 million square feet of gross leasable area. Tanger also operates twooutlet centers containing approximately 667,000 square feet in which it owns a50% interest.
Certain matters discussed in this press release regarding our debtretirement and refinancing strategy may be forward-looking statements withinthe meaning of the federal securities laws. These forward-looking statementsare subject to risks and uncertainties. Actual results could differmaterially from those projected due to various factors including, but notlimited to, the risks associated with general economic and local real estateconditions, the availability and cost of capital, the company's ability tolease its properties, the company's inability to collect rent due to thebankruptcy or insolvency of tenants or otherwise, and competition. For a moredetailed discussion of the factors that affect our operating results,interested parties should review the Tanger Factory Outlet Centers, Inc.Annual Report on Form 10-K for the fiscal year ended December 31, 2007.
SOURCE Tanger Factory Outlet Centers, Inc.
