Tanger CEO talks being 'very optimistic' about growth in 2024

Tanger Outlets (SKT) ended 2023 with 40 shopping centers as the company continues to build their portfolio of outlet destinations. Tanger CEO Stephen Yalof joins Yahoo Finance Live to discuss plans for further expansion moving forward in 2024.

Yalof says he's "very optimistic about 2024" as consumers have remained resilient amid economic uncertainty. He notes apparel was "a big trend" in Tanger's fourth-quarter results, with family apparel seeing particular success. He calls this "exciting," given around 50% of their portfolio is apparel brands. Other categories showing continued momentum are athleisure and athletic footwear.

Beyond the merchandise itself, Yalof says Tanger focuses on creating "a sense of community" within their shopping centers. He stresses their expansion strategy targets areas that allow them to engage both tourist and local shopper bases, which continually drives sales.

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Editor's note: This article was written by Angel Smith

Video Transcript

SEANA SMITH: Outlet brand Tanger is doubling down on expansion with its national portfolio now reaching 40 shopping centers in 2023. The company's fourth quarter net income also jumping nearly 30% from a year ago.

For more, we want to bring in, Stephen Yalof, joining us here in studio, CEO of Tanger. Stephen, it's great to have you in studio with us here for the first time on our new set.

Let's talk about some of the trends that you're seeing play out within the industry. We talked to guest after guest, who continues to tell us that the consumer is very resilient. It's going to remain that way, even in the face of extremely sticky inflation. Is that consistent with what you're seeing?

STEPHEN YALOF: It is. And we're seeing it both at the cash register, as well as-- we listen to the earnings calls of all the big brands. We have a lot of national brands and publicly traded companies that have do business in our shopping centers. And their outlook seems to be pretty good for next year.

So we're very optimistic about 2024 and sales.

BRAD SMITH: You have a lot of that information on what the foot traffic into. A lot of these different stores who operate within your retail and real estate properties that you put forward and put out there into the market.

When you think about where the consumer is typically going into looking for more value, looking for more deals, what are you seeing in terms of those flows as well?

STEPHEN YALOF: The big trend coming out of the fourth quarter was apparel, particularly, the family apparel brands. Brands like Gap and American Eagle and brands that define the category. So that's been a pretty exciting trend for us, particularly, because 50% of our portfolio stores are apparel brands.

But other trends that have still been remain consistent are the athletic footwear brands and the athleisure brands. And there's a lot of other athleisure brands that are getting into the fold now too between Athleta and Vuori joining very productive and very successful Lululemon stores.

SEANA SMITH: Stephen, talk to us about your expansion strategy going forward, because you guys just did something interesting here just in terms of expanding beyond the outlet strategy, which you're very much known for. Why does that make sense at this time?

STEPHEN YALOF: It's interesting, though, a lot of the retailers that are in the outlets are also in the open air lifestyle centers and the regional malls as well. We've got this ability between the platform that we've built, that's a great operator, marketers, and leasing team that can go out and execute across all those different types of portfolios.

We like open air. We like the fact that people like to gather. We like the fact that there's a sense of community in our shopping centers. And we're both a local draw, as well as, a regional draw. We just talked about Asheville, North Carolina, a new center that we just bought. There's a great local trade in Asheville that shops that center almost as if it's its regional mall.

But then, again, 12 million people a year come and visit that city. So we're pretty clever in how we go after both the tourist trade and the local trade, and balance both of those things.