Tanger has just acquired the Town Center at Levis Commons outside Toledo, OH. This is the fourth open-air lifestyle center purchased since late 2023 as Tanger pivots from premium outlet centers into full-price retail. And the shift isn’t just happening through new lifestyle centers. Full-priced retailers are increasingly showing up inside Tanger’s outlet centers too, like Sephora, Warby Parker, Lego and Bath & Body Works.
Several factors are pushing Tanger to expand its horizons. Partly, open-air shopping centers are the place to be. Through May, traffic growth in open-air centers averaged 4.8%, while outlet malls only picked up 2% more visitors. Placer.ai attributes the difference to open-air centers’ broader array of experiences, such as restaurants, fitness and entertainment, and their stronger pull with local affluent shoppers. Outlet malls, by contrast, rely heavily on tourist traffic—a segment hit by rising gas prices—and on discretionary fashion and accessories, which many shoppers have delayed amid economic uncertainty.
However, Tanger is transforming its flagship outlet centers to be more like open-air lifestyle concepts with more things to do besides shopping. Population shifts are moving people closer to historically far-flung outlets, and department store consolidation is depriving new transplants in secondary markets of in-person access to many brands. And those displaced department store brands are now turning to Tanger to fill the gap.
All of this creates tailwinds as Tanger navigates retail’s shifting tides. The company is building connections with full-priced brands and inviting them into its outlet flywheel—while leveraging the deep brand relationships established in its outlet ecosystem to build momentum in its full-price centers.
“The evolution of our tenant portfolio is reflected in the progress that we’ve made, replacing underperforming retailers in our centers with more productive and highly sought-after ones, creating a flywheel that drives traffic, sales increases, and ultimately revenue growth for us and our retail partners,” CEO Stephen Yalof said.
“Our belief in the strength of our portfolio is evident in our continued strategy to renew fewer tenants and replace them with new concepts, retailers and uses across our platform. Retailer interest across our portfolio remains strong,” he continued.
New Faces At Tanger
Since 2022, Tanger has added eight new centers to its portfolio—four full-priced lifestyle centers and four outlet malls, including newly-built Tanger Outlets Nashville. Across the platform, it now hosts more than 3,000 stores operated by over 800 brands.
The acquisition of the Town Center at Levis Common brought Dybar, Ethan Allen and Arhaus into the Tanger fold, while deepening ties to top retail brands like Anthropologie, Sephora, Lululemon, Shake Shake, Starbucks and Cinemark.
Its three other lifestyle center acquisitions— Pinecrest in Cleveland, OH; The Promenade at Chenal in Little Rock, AR; and Bridge Street Town Centre in Huntsville, AL—have broadened its reach across many A-list brands, including Alo Yoga, Apple, Barnes & Noble, Dick’s Sporting Goods, H&M, Kendra Scott, Lovesac, Madewell, Pottery Barn, REI, Sono Bello, UNTUCKit, Warby Parker, Williams-Sonoma and more.
These new centers have also pulled a wide range of dining and entertainment concepts into Tanger’s orbit. And across its 38-center outlet portfolio, adding more experiences remains a priority—both through re-tenanting existing spaces and activating peripheral land around existing properties.
The shift is visible in the numbers: non-apparel and footwear brands in Tanger leasable space have grown from 19% in 2019 to 31% most recently. Another significant shift is that average sales per square foot have grown from $385 pre-COVID to $485 today.
“A big part of driving that growth is food & beverage and entertainment tenants,” Yalof said. “Plus more health, beauty, bookstores, hard goods and other kinds of tenants are coming to our portfolio.”
Tanger’s top ten tenants, representing 30% of its annualized base rent, include:
- Gap Inc. (Athleta, Banana Republic, Gap and Old Navy)—5.2%
- Knitwell (Ann Taylor, Chico’s, Lane Bryant, Loft, Soma, Talbots and White House-Black Market)—4.3%
- American Eagle Outfitters (Aerie and American Eagle)—3.2%
- Tapestry (Coach and Kate Spade)—3.2%
- Under Armour—3%
- PVH (Calvin Klein and Tommy Hilfiger)—2.4%
- Nike—2.4%
- Catalyst (Aeropostale, Brooks Brothers, Eddie Bauer, Lucky Brand and Nautica)—2.3%
- Columbia—2%
- Signet (Banter, Jared, Kay, Peoples and Zales)—2%
“I like to mix our centers with brands that draw customers,” he continued. “It grows traffic, increases dwell time and ultimately grows sales. We are strategically choosing not to renew certain leases to upgrade the tenant mix.”
To that end, Tanger has achieved a 26% re-tenanting spread by replacing underperforming retailers with more in-demand brands, such as Aritzia, Birkenstock, Crocs, Fabletics, L.L.Bean, Marc Jacobs, Vuori, and Tecovas—all new to the portfolio.
People Moving To Tanger Territory
Another shift propelling Tanger’s growth is people moving into secondary markets where the company got its start 45 years ago. “Places like Foley, AL on the Gulf Shores, Myrtle Beach, SC and Pooler, GA outside Savannah are growing rapidly, so our centers there are not just serving tourists coming for the outlet experience—they are serving as a primary shopping center for the locals,” he shared.
The Tanger Nashville outlet center, opened in 2023 and located in the rapidly growing Antioch suburb 30 minutes southeast of downtown, shows how an outlet mall can anchor a community. The center sits right off I-24, a major commuter thoroughfare, and is adjacent to the mixed-use Century Farms development, including apartments, medical offices, hotels and restaurants, and major big-box retailers.
Tanger Nashville complements the local shopping mix with 60 stores—nearly one quarter of them brands either new to Tanger or first to its outlet channel—and an outdoor community space, called The Green, for programming and activations.
Premium brands, including those displaced by department store consolidation, are increasingly drawn to Tanger outlets as an on ramp for the Gen Z consumer. This digitally native generation has embraced brick-and-mortar retail and their more constrained economic status makes outlet shopping a prime destination.
“The outlet customer is an aspirational consumer—someone who aspires to see and touch the brands they’ve seen in advertising, on influencers’ posts and worn by movie stars and athletes,” Yalof related. “Brands understand that outlets can be the entry point for new customers who will ultimately trade up through their ecosystem and be a customer for the long term.”
Rewarding Loyalty
Rounding out Tanger’s value proposition for retailers is the TangerClub loyalty program, which offers members discount coupons across its outlets and rewards them with points based on spending that unlock additional rewards. “Members get discounts off the everyday value pricing available at our outlets,” Yalof said. “Value never goes out of fashion.”
The basic TangerClub Blue is free to join, with an upgraded Gold tier available for $20 per year that offers even deeper discounts, more points per dollar of spending and VIP parking. Gold members who spend $500 annually graduate to the Platinum tier for even greater rewards.
“It’s pretty unique for a real estate company to be consumer-focused like Tanger, with our own app, loyalty program and text messaging,” Yalof explained. “That uniqueness gives us an edge.”
White Space
Tanger owns about half of the nation’s 70 outlet malls—Simon Premium Outlets is the other major operator. Yet, as Tanger leans into full-priced retail, it is edging further into Simon’s territory. And with a footprint spanning only 22 states, Tanger has room to grow.
“It used to be that outlet shopping was the experience,” Yalof concluded. “But our centers are no longer just serving tourist traffic—we want to be the destination for both the tourist trade and the local customers. I believe we are the best-in-class to do that.”
See Also:
