Quarterly report pursuant to Section 13 or 15(d)

Debt of the Operating Partnership

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Debt of the Operating Partnership
3 Months Ended
Mar. 31, 2018
Tanger Properties Limited Partnership [Member]  
Debt of the Operating Partnership
Debt of the Operating Partnership

The debt of the Operating Partnership consisted of the following (in thousands):
 
 
 
 
 
 
As of
 
As of
 
 
 
 
 
 
March 31, 2018
 
December 31, 2017
 
 
Stated Interest Rate(s)
 
Maturity Date
 
Principal
 
Book Value(1)
 
Principal
 
Book Value(1)
Senior, unsecured notes:
 
 
 
 

 
 
 
 
 
 
Senior notes
 
3.875
%
 
December 2023
 
$
250,000

 
$
246,192

 
$
250,000

 
$
246,036

Senior notes
 
3.750
%
 
December 2024
 
250,000

 
247,498

 
250,000

 
247,410

Senior notes
 
3.125
%
 
September 2026
 
350,000

 
345,263

 
350,000

 
345,128

Senior notes
 
3.875
%
 
July 2027
 
300,000

 
296,277

 
300,000

 
296,182

 
 
 
 
 
 
 
 
 
 
 
 
 
Mortgages payable:
 
 
 
 
 
 
 
 
 
 
 
 
Atlantic City (2)(3)
 
5.14%-7.65%

 
November 2021- December 2026
 
36,682

 
39,001

 
37,462

 
39,879

     Southaven
 
LIBOR + 1.80%

 
April 2021
 
51,400

 
51,108

 
60,000

 
59,881

Unsecured term loan
 
LIBOR + 0.95%

 
April 2021
 
325,000

 
323,082

 
325,000

 
322,975

Unsecured lines of credit
 
LIBOR + 0.875%

 
October 2021
 
227,600

 
223,634

 
208,100

 
206,160

 
 
 
 
 
 
$
1,790,682

 
$
1,772,055

 
$
1,780,562

 
$
1,763,651

(1)
Including premiums and net of debt discount and debt origination costs.
(2)
The effective interest rate assigned during the purchase price allocation to the Atlantic City mortgages assumed during the acquisition in 2011 was 5.05%.
(3)
Principal and interest due monthly with remaining principal due at maturity.

Certain of our properties, which had a net book value of approximately $189.3 million at March 31, 2018, serve as collateral for mortgages payable. We maintain unsecured lines of credit that provide for borrowings of up to $600.0 million. The unsecured lines of credit include a $20.0 million liquidity line and a $580.0 million syndicated line. The syndicated line may be increased up to $1.2 billion through an accordion feature in certain circumstances. As of March 31, 2018, letters of credit totaling approximately $6.0 million were issued under the lines of credit.

We provide guarantees to lenders for our joint ventures which include standard non-recourse carve out indemnifications for losses arising from items such as but not limited to fraud, physical waste, payment of taxes, environmental indemnities, misapplication of insurance proceeds or security deposits and failure to maintain required insurance. For construction and term loans, we may include a guaranty of completion as well as a principal guaranty ranging from 5% to 100% of principal.  The principal guarantees include terms for release or reduction based upon satisfactory completion of construction and performance targets including occupancy thresholds and minimum debt service coverage tests. As of March 31, 2018, the maximum amount of unconsolidated joint venture debt guaranteed by the Company was $32.7 million.

The unsecured lines of credit and senior unsecured notes include covenants that require the maintenance of certain ratios, including debt service coverage and leverage, and limit the payment of dividends such that dividends and distributions will not exceed funds from operations, as defined in the agreements, for the prior fiscal year on an annual basis or 95% of funds from operations on a cumulative basis. As of March 31, 2018, we were in compliance with all of our debt covenants.

Increased Borrowing Capacity and Extension of Unsecured Lines of Credit

In January 2018, we closed on amendments to our unsecured lines of credit, which increased the borrowing capacity from $520.0 million to $600.0 million and extended the maturity date from October 2019 to October 2021, with a one-year extension option. We also reduced the interest rate spread over LIBOR from 0.90% to 0.875%, and increased the incremental borrowing availability through an accordion feature on the syndicated line from $1.0 billion to $1.2 billion. Loan origination costs associated with the amendments totaled approximately $2.3 million.

Southaven Mortgage

In February 2018, the consolidated joint venture that owns the Tanger outlet center in Southaven, Mississippi amended and restated the $60.0 million mortgage loan secured by the property that was scheduled to mature in April 2018. The amended and restated loan reduced the principal balance to $51.4 million, increased the interest rate from LIBOR + 1.75% to LIBOR + 1.80% and extended the maturity to April 2021, with a two-year extension option. In March 2018, the consolidated joint venture entered into an interest rate swap, effective March 1, 2018, that fixed the base LIBOR rate at 2.47% on a notional amount of $40.0 million through January 31, 2021.

Debt Maturities

Maturities of the existing long-term debt as of March 31, 2018 for the next five years and thereafter are as follows (in thousands):
Calendar Year
 
Amount

2018
 
$
2,404

2019
 
3,369

2020
 
3,566

2021
 
609,793

2022
 
4,436

Thereafter
 
1,167,114

Subtotal
 
1,790,682

Net discount and debt origination costs
 
(18,627
)
Total
 
$
1,772,055