--------------------------------------------------------------------------------

                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                             ----------------------

            [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended September 30, 1997

                                       OR
            [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) of
                       THE SECURITIES EXCHANGE ACT OF 1934

             For the transition period from __________ to _________

                 Commission File Nos.: 33-99736-01, 333-3526-01

                      TANGER PROPERTIES LIMITED PARTNERSHIP
             (Exact name of Registrant as specified in its Charter)

          NORTH CAROLINA                                      56-1822494
 (State or other jurisdiction                               (I.R.S. Employer
of incorporation or organization)                          Identification No.)

          1400 West Northwood Street, Greensboro, North Carolina 27408
                    (Address of principal executive offices)
                                   (Zip code)

                                  910-274-1666
              (Registrant's telephone number, including area code)

                            -------------------------

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes |X| No |_|

--------------------------------------------------------------------------------
<PAGE>

                      TANGER PROPERTIES LIMITED PARTNERSHIP

                                      Index

                          Part I. Financial Information

                                                                   Page Number
Item 1.  Financial Statements (Unaudited)

         Statements of Operations
             For the three and nine months ended September 
               30, 1997 and 1996                                          3

         Balance Sheets
             As of September 30, 1997 and December 31, 1996               4

         Statements of Cash Flows
             For the nine months ended September 30, 1997 and 1996        5

         Notes to Financial Statements                                    6

Item 2.  Management's Discussion and Analysis of Financial
             Condition and Results of Operations                          8

                           Part II. Other Information

Item 1.  Legal proceedings                                               15

Item 6.  Exhibits and Reports on Form 8-K                                15

Signatures                                                               16


                                       -2-
<PAGE>

                            TANGER PROPERTIES LIMITED PARTNERSHIP
                                   STATEMENTS OF OPERATIONS
                                         (Unaudited)
                             (In thousands, except per unit data)

<TABLE>
<CAPTION>
                                                  Three Months Ended            Nine Months Ended
                                                     September 30,                September 30,
                                                   1997        1996             1997        1996
                                                ----------------------------------------------------
<S>                                                <C>          <C>              <C>         <C>    
REVENUES
   Base rentals                                    $14,404      $12,779          $41,362     $37,497
   Percentage rentals                                  779          566            1,482       1,164
   Expense reimbursements                            6,200        5,901           17,799      16,446
   Other income                                        274          207              695         658
                                                ----------------------------------------------------
        Total revenues                              21,657       19,453           61,338      55,765
                                                ----------------------------------------------------
EXPENSES
   Property operating                                6,584        6,372           18,732      17,737
   General and administrative                        1,500        1,365            4,528       4,036
   Interest                                          4,414        3,614           12,193      10,282
   Depreciation and amortization                     4,790        4,178           13,694      12,285
                                                ----------------------------------------------------
        Total expenses                              17,288       15,529           49,147      44,340
                                                ----------------------------------------------------
Income before gain on sale of land and
   extraordinary item                                4,369        3,924           12,191      11,425
Gain on sale of land                                   ---          159              ---         159
                                                ----------------------------------------------------
Income before extraordinary item                     4,369        4,083           12,191      11,584
Extraordinary item - Loss on early extinguishment
   of debt                                             ---          ---              ---        (831)
                                                ----------------------------------------------------
Net income                                          $4,369       $4,083          $12,191     $10,753
                                                ====================================================

Per unit outstanding:
   Income before extraordinary item                   $.40         $.37            $1.11       $1.03
   Net income                                          .40          .37             1.11         .94
                                                ====================================================

Distributions paid per unit                           $.55         $.52            $1.62       $1.54
                                                ====================================================
</TABLE>

The accompanying notes are an integral part of these financial statements.


                                       -3-
<PAGE>

                      TANGER PROPERTIES LIMITED PARTNERSHIP
                                 BALANCE SHEETS

                                 (In thousands)

                                                      September 30, December 31,
                                                           1997         1996
                                                      --------------------------
                                                       (Unaudited)   
ASSETS                                                               
   Rental property, net                                  $382,737       $311,454
   Cash and cash equivalents                                3,358          2,567
   Deferred charges, net                                    7,546          7,846
   Other assets                                            10,737         10,087
                                                      --------------------------
        Total assets                                     $404,378       $331,954
                                                      ==========================
LIABILITIES AND PARTNERS' EQUITY                                     
Liabilities                                                          
   Long-term debt                                        $218,398       $178,004
   Construction trade payables                             19,160          8,320
   Accounts payable and accrued expenses                    7,762          9,374
                                                      --------------------------
        Total liabilities                                 245,320        195,698
                                                      --------------------------
Commitments                                                          
Partners' equity                                                     
   General partner                                        134,938        110,657
   Limited partner                                         24,120         25,599
                                                      --------------------------
        Total partners' equity                            159,058        136,256
                                                      --------------------------
             Total liabilities and partners' equity      $404,378       $331,954
                                                      ==========================
                                                                    
The accompanying notes are an integral part of these financial statements.


                                       -4-
<PAGE>

                      TANGER PROPERTIES LIMITED PARTNERSHIP
                            STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                 (In thousands)

<TABLE>
<CAPTION>
                                                                        Nine Months Ended
                                                                           September 30,
                                                                        1997          1996
                                                                     -------------------------
<S>                                                                     <C>          <C>    
OPERATING ACTIVITIES
   Net income                                                           $12,191      $10,753
   Adjustments to reconcile net income to net cash provided by
      operating activities:
      Depreciation and amortization                                      13,694       12,285
      Amortization of deferred financing costs                              780          694
      Loss on early extinguishment of debt                                  ---          831
      Gain on sale of land                                                  ---         (159)
      Straight-line base rent adjustment                                   (328)        (946)
      Compensation under Unit Option Plan                                   253          254
   Increase (decrease) due to changes in:
      Other assets                                                          383          949
      Accounts payable and accrued expenses                              (1,612)       3,406
                                                                     -------------------------
           Net cash provided by operating activities                     25,361       28,067
                                                                     -------------------------
 INVESTING ACTIVITIES
   Acquisition of rental properties                                     (37,500)         ---
   Additions to rental properties                                       (36,231)     (26,815)
   Additions to deferred lease costs                                     (1,489)      (1,275)
   Proceeds from sale of land                                               ---          174
                                                                     -------------------------
       Net cash used in investing activities                            (75,220)     (27,916)
                                                                     -------------------------
FINANCING ACTIVITIES
   Contributions from general partner                                    27,038          ---
   Cash distributions paid to partners                                  (17,163)     (16,316)
   Proceeds from notes payable                                              ---       75,000
   Repayments on notes payable                                             (856)        (747)
   Proceeds from revolving lines of credit                              107,050       51,026
   Repayments on revolving lines of credit                              (65,800)    (107,927)
   Additions to deferred financing costs                                   (102)      (3,440)
   Proceeds from exercise of unit options                                   483          ---
                                                                     -------------------------
           Net cash provided by (used in) financing activities           50,650       (2,404)
                                                                     -------------------------
Net increase (decrease) in cash and cash equivalents                        791       (2,253)
Cash and cash equivalents, beginning of period                            2,567        5,113
                                                                     -------------------------
Cash and cash equivalents, end of period                                 $3,358       $2,860
                                                                     =========================
</TABLE>

The accompanying notes are an integral part of these financial statements.


                                       -5-
<PAGE>

                      TANGER PROPERTIES LIMITED PARTNERSHIP
                          NOTES TO FINANCIAL STATEMENTS
                               September 30, 1997
                                   (Unaudited)

1.    Interim Financial Statements

      The unaudited financial statements of Tanger Properties Limited
      Partnership, (the "Operating Partnership"), have been prepared pursuant to
      the Securities and Exchange Commission's ("SEC") rules and regulations and
      should be read in conjunction with the financial statements and notes
      thereto of the Operating Partnership's Annual Report on Form 10-K for the
      year ended December 31, 1996. Certain information and note disclosures
      normally included in financial statements prepared in accordance with
      generally accepted accounting principles have been condensed or omitted
      pursuant to such rules and regulations, although management believes that
      the disclosures are adequate to make the information presented not
      misleading.

      The accompanying financial statements reflect, in the opinion of
      management, all adjustments necessary for a fair presentation of the
      interim financial statements. All such adjustments are of a normal and
      recurring nature.

2.    Acquisition and Development of Rental Properties

      On February 28, 1997, the Operating Partnership completed the acquisition
      of Five Oaks Factory Stores, a factory outlet center in Sevierville,
      Tennessee, containing approximately 123,000 square feet, for an aggregate
      purchase price of $18 million. On September 30, 1997, the Operating
      Partnership acquired Shoppes on the Parkway, a factory outlet center in
      Blowing Rock, North Carolina, containing approximately 98,000 square feet,
      and Soundings Factory Stores, a factory outlet center in Nags Head, North
      Carolina, containing approximately 82,000 square feet, for an aggregate
      purchase price of $19.5 million. The acquisitions were accounted for using
      the purchase method whereby the purchase price was allocated to assets
      acquired based on their fair values. The results of operations of the
      acquired properties have been included in the results of operations since
      the acquisition date.

      During the first nine months, construction was substantially completed on
      a 241,820 square foot expansion in Riverhead, NY, and a 26,111 square foot
      expansion in Lancaster, PA. Construction has also begun on properties in
      Commerce, GA (61,000 square feet); Sevierville, TN (50,000 square feet)
      and San Marcos, TX (23,000 square feet) as well as a further expansion in
      Riverhead, NY (60,000 square feet).

      Construction in progress amounted to $17.8 million and commitments to
      complete construction of expansions to existing properties amounted to
      approximately $6.8 million at September 30, 1997. Commitments for
      construction represent only those costs contractually required to be paid
      by the Operating Partnership.

      Interest costs capitalized during the three months ended September 30,
      1997 and 1996 amounted to $399,000 and $278,000, respectively, and during
      the nine months ended September 30, 1997 and 1996 amounted to $1,451,000
      and $734,000, respectively.

3.    Accumulated Depreciation

      Accumulated depreciation at September 30, 1997 and December 31, 1996 was
      approximately $59,722,000 and $46,907,000 respectively.


                                       -6-
<PAGE>

4.    Contributions from General Partner

      On September 24, 1997, the Operating Partnership's general partner and
      majority owner, Tanger Factory Outlet Centers, Inc. (the "Company"),
      completed a public offering of 1,000,000 Common Shares at a price of
      $29.0625 per share, receiving net proceeds of approximately $27.0 million.
      Subsequently, on October 15, 1997, the Company issued an additional 80,000
      Common Shares pursuant to an over-allotment option granted to the
      underwriters and received net proceeds of approximately $2.2 million. The
      net proceeds were contributed to the Operating Partnership in exchange for
      1,080,000 partnership units, and were used to acquire, expand and develop
      factory outlet centers and for general corporate purposes.

5.    Income Per Unit

      Income per unit is computed by dividing income, less applicable preferred
      distributions, by the weighted average number of general and limited
      partnership units outstanding. Options outstanding are not included since
      their inclusion would not be materially dilutive. The assumed conversion
      of preferred units to general partnership units as of the beginning of the
      year would have been anti-dilutive.

<TABLE>
<CAPTION>
                                             Three Months Ended            Nine Months Ended
                                                 September 30,                September 30,
                                             1997           1996          1997           1996
                                     -----------------------------------------------------------
<S>                                        <C>            <C>          <C>            <C>       
Applicable preferred distributions         $450,000       $602,000     $1,358,000     $1,885,000
Weighted average units                    9,852,264      9,436,303      9,789,378      9,404,709
                                     ===========================================================
</TABLE>

      At September 30, 1997 and December 31, 1996, the ownership interests of
      the Operating Partnership consisted of the following:

<TABLE>
<CAPTION>
                                                                   September 30,    December 31,
                                                                       1997             1996
                                                                 --------------------------------
<S>                                                                  <C>              <C>      
General partnership units                                            7,763,985        6,602,510
Limited partnership units                                            3,033,305        3,033,305
Preferred partnership units, held by the general partner                90,789          106,419
                                                                 ================================
</TABLE>

      In February 1997, the Financial Accounting Standards Board issued SFAS
      #128, Earnings Per Share, effective for fiscal periods ending after
      December 15, 1997. The new standard simplifies the computation of income
      per unit by replacing primary income per unit with basic income per unit.
      Basic income per unit will not include the effect of any potentially
      dilutive securities, as under the current accounting standard, and will be
      computed by dividing reported income available to holders of general and
      limited partnership units by the weighted average units outstanding during
      the period. Fully diluted income per unit will now be called diluted
      income per unit and will reflect the dilution of all potentially dilutive
      securities. Companies will be required to restate all prior period income
      per unit data. The adoption of this standard by the Operating Partnership
      will have no impact on the historical reported income per unit amounts
      since the effect of potentially dilutive securities have been immaterial
      and, therefore, have been excluded from the historical income per unit
      computations.


                                       -7-
<PAGE>

6.    Supplemental schedule of non-cash investing activities

      The Operating Partnership purchases capital equipment and incurs costs
      relating to construction of new facilities, including tenant finishing
      allowances. Expenditures included in construction trade payables as of
      September 30, 1997 and 1996 amounted to $19,160,000 and $6,424,000,
      respectively.

7.    Subsequent Events

      On October 24, the Operating Partnership issued $75 million of senior,
      unsecured notes, maturing October 24, 2004, with a coupon rate of 7.875%.
      The notes were priced at 99.799% of par with a yield to investors of
      7.913%. The net proceeds were used to repay substantially all amounts
      outstanding under its existing lines of credit. On November 3, 1997, the
      Company and the Operating Partnership filed a new registration statement
      with the SEC to provide an issuance capacity under existing shelf
      registration statements of $200 million.

      In anticipation of the offering of the senior, unsecured notes, the
      Operating Partnership entered into an interest rate protection agreement
      on October 3, 1997 which fixed the index on the 10 year US Treasury rate
      at 5.995% for 30 days on a notional amount of $70,000,000. The transaction
      settled on October 21, 1997, the trade date of the $75 million offering,
      and, as a result of an increase in the US Treasury rate, the Operating
      Partnership received $714,000 in proceeds. Such amount will be amortized
      as a reduction to interest expense over the life of the notes and will
      result in an overall effective interest rate on the notes of 7.75%.

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations.

CAUTIONARY STATEMENTS

Certain statements contained in the discussion below, including, without
limitation, statements containing the words "believes," "anticipates,"
"expects," and words of similar import, constitute "forward-looking statements
within the meaning of the Private Securities Reform Act of 1995. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors that may cause the actual results, performance or achievements of
the Operating Partnership, or industry results, to be materially different from
any future results, performance or achievements expressed or implied by such
forward-looking statements. Such factors include, among others, the following:
the effects of future events on the Operating Partnership's financial
performance; the risk that the Operating Partnership may not be able to finance
its planned development activities; risks related to the retail industry in
which the Operating Partnership's outlet centers compete, including the
potential adverse impact of external factors such as inflation, tenant demand
for space, consumer confidence, unemployment rates and consumer tastes and
preferences; risks associated with the Operating Partnership's development
activities, such as the potential for cost overruns, delays and lack of
predictability with respect to the financial returns associated with these
development activities; the risk of potential increase in market interest rates
from current rates; risks associated with real estate ownership, such as the
potential adverse impact of changes in the local economic climate on the
revenues and the value of the Operating Partnership's properties; and the risks
that a significant number of tenants may become unable to meet their lease
obligations or that the Operating Partnership may be unable to renew or re-lease
a significant amount of available space on economically favorable terms. Given
these uncertainties, current and prospective investors are cautioned not to
place undue reliance on such forward-looking statements. The Operating
Partnership disclaims any obligation to update any such factors or to publicly
announce the result of any revisions to any of the forward-looking statements
contained herein to reflect future events or developments.


                                       -8-
<PAGE>

OVERVIEW

The following discussion and analysis of the financial condition and results of
operations should be read in conjunction with the Financial Statements and Notes
thereto. Historical results and percentage relationships set forth in the
Statements of Operations, including trends which might appear, are not
necessarily indicative of future operations.

The discussion of the Operating Partnership's results of operations reported in
the Statements of Operations compares the three and nine months ended September
30, 1997 with the three and nine months ended September 30, 1996. Certain
comparisons between the periods are also made on a percentage basis as well as
on a weighted average gross leasable area ("GLA") basis, a technique which
adjusts for certain increases or decreases in the number of centers and
corresponding square feet related to the development and expansion or
disposition of rental properties. The computation of weighted average GLA,
however, does not adjust for fluctuations in occupancy during each period shown
since GLA is not reduced when original occupied space subsequently becomes
vacant.

The Operating Partnership continues to grow principally through acquisitions,
new development and expansions of factory outlet centers. On February 28, 1997,
the Operating Partnership completed the acquisition of Five Oaks Factory Stores,
a factory outlet center in Sevierville, Tennessee, containing approximately
123,000 square feet, for an aggregate purchase price of $18 million. On
September 30, 1997, the Operating Partnership acquired Shoppes on the Parkway, a
factory outlet center in Blowing Rock, North Carolina, containing approximately
98,000 square feet, and Soundings Factory Stores, a factory outlet center in
Nags Head, North Carolina, containing approximately 82,000 square feet, for an
aggregate purchase price of $19.5 million.

During the first nine months, construction was substantially completed on a
241,820 square foot expansion in Riverhead, NY, and a 26,111 square foot
expansion in Lancaster, PA. Construction has also begun on properties in
Commerce, GA (61,000 square feet); Sevierville, TN (50,000 square feet) and San
Marcos, TX (23,000 square feet) as well as a further expansion in Riverhead, NY
(60,000 square feet).


                                       -9-
<PAGE>

A summary of the operating results for the three and nine months ended September
30, 1997 and 1996, calculated on a weighted average GLA basis, is presented in
the following table.

<TABLE>
<CAPTION>
                                                 Three Months Ended                 Nine Months Ended
                                                     September 30,                     September 30,
                                                  1997          1996                1997           1996
                                         --------------------------------------------------------------
<S>                                               <C>          <C>                 <C>            <C>  
GLA at end of period (000's)                      4,289        3,718               4,289          3,718
Weighted Average GLA(a) (000's)                   4,079        3,686               3,928          3,614
Outlet centers in operation                          30           27                  30             27
New centers opened                                  ---          ---                 ---            ---
New centers acquired                                  2          ---                   3            ---
Centers expanded                                      1            2                   2              6
States operated in at end of period                  23           22                  23             22

     Per square foot
Revenues
     Base rent                                    $3.53        $3.47              $10.53         $10.38
     Percentage rentals                             .19          .15                 .38            .32
     Expense reimbursements                        1.52         1.60                4.53           4.55
     Other income                                   .07          .06                 .18            .18
                                         --------------------------------------------------------------
          Total revenues                           5.31         5.28               15.62          15.43
                                         --------------------------------------------------------------
Expenses
     Property operating                            1.61         1.73                4.77           4.91
     General and administrative                     .37          .37                1.15           1.12
     Interest                                      1.08          .98                3.10           2.85
     Depreciation and amortization                 1.17         1.13                3.49           3.40
                                         --------------------------------------------------------------
          Total expenses                           4.23         4.21               12.51          12.28
                                         --------------------------------------------------------------
Income before gain on sale of land
   and extraordinary item                         $1.08        $1.07               $3.11          $3.15
                                         ==============================================================
</TABLE>

(a) GLA weighted by months of operations

RESULTS OF OPERATIONS

Comparison of the three months ended September 30, 1997 to the three months
ended September 30, 1996

Base rentals increased $1.6 million, or 13%, in the 1997 period when compared to
the same period in 1996 primarily as a result of the 11% increase in weighted
average GLA. Base rentals increased approximately $200,000 due to the effect of
a full year's operation of expansions completed in 1996 and approximately $1.4
million for new or acquired leases added during 1997.

Expense reimbursements, which represent the contractual recovery from tenants of
certain common area maintenance, operating, property tax, promotional and
management expenses generally fluctuates consistently with the reimbursable
property operating expenses to which it relates. Expense reimbursements,
expressed as a percentage of property operating expenses, increased from 92% in
the 1996 period to 94% in the 1997 period due primarily to a reduction in
nonreimbursable property operating expenses.


                                      -10-
<PAGE>

Property operating expenses increased by $212,000, or 3%, in the 1997 period as
compared to the 1996 period but, on a weighted average GLA basis, decreased 7%
to $1.61 from $1.73 per square foot. The decrease in cost per foot is due
primarily to lower advertising and promotional expenses incurred during the 1997
period compared to the 1996 period.

Interest expense increased $800,000 during the 1997 period as compared to the
1996 period due to higher average borrowings outstanding during the period.
Average borrowings have increased principally to finance the acquisition of Five
Oaks Factory Stores (see "Overview" above) and expansions to existing centers.
Depreciation and amortization per weighted average GLA increased from $1.13 per
square foot to $1.17 per square foot. The increase reflects the effect of
accelerating the recognition of depreciation expense on certain tenant finishing
allowances related to vacant space.

Comparison of the nine months ended September 30, 1997 to the nine months ended
September 30, 1996

Base rentals increased $3.9 million, or 10%, in the 1997 period when compared to
the same period in 1996 primarily as a result of the 9% increase in weighted
average GLA. Base rent increased approximately $1.3 million due to the effect of
a full year's operation of expansions completed in 1996 and approximately $2.4
million for new or acquired leases added during 1997.

Expense reimbursements, which represent the contractual recovery from tenants of
certain common area maintenance, operating, property tax, promotional and
management expenses generally fluctuates consistently with the reimbursable
property operating expenses to which it relates. Expense reimbursements,
expressed as a percentage of property operating expenses, increased from 93% in
the 1996 period to 95% in the 1997 period due primarily to a reduction in
nonreimbursable property operating expenses.

Property operating expenses increased by $995,000, or 6%, in the 1997 period as
compared to the 1996 period. However, on a weighted average GLA basis, property
operating expenses decreased to $4.77 from $4.91 per square foot. The decrease
is primarily due to lower advertising and promotional expenses incurred in the
1997 period compared to the 1996 period.

Interest expense increased $1,911,000 during the 1997 period as compared to the
1996 period due to higher average borrowings outstanding during the period.
Average borrowings have increased principally to finance the acquisition of Five
Oaks Factory Stores (see "Overview" above) and expansions to existing centers.
Depreciation and amortization per weighted average GLA increased from $3.40 per
square foot to $3.49 per square foot. The increase reflects the effect of
accelerating the recognition of depreciation expense on certain tenant finishing
allowances related to vacant space.

The extraordinary item in the 1996 period represents a write-off of the
unamortized deferred financing costs related to the lines of credit which were
extinguished using the proceeds from the Operating Partnership's $75 million
senior unsecured notes issued in March 1996.


                                      -11-
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

Net cash provided by operating activities was $25.3 million and $28.1 million
for the nine months ended September 30, 1997 and 1996, respectively. The
decrease of $2.8 million was primarily due to the timing of the Operating
Partnership's semiannual interest payment on the senior unsecured notes issued
in March 1996 with payments due in March and September of each year. Net cash
used in investing activities increased $47.3 million the first nine months of
1997 compared to the first nine months of 1996 due primarily to the acquisitions
of the outlet centers in Tennessee and North Carolina and the construction of
the Riverhead and Lancaster expansions. Net cash from financing activities
increased $53.1 million as a result of net proceeds contributed by the general
partner from its Common Share offering and the incremental financing used for
the acquisitions and the construction of the expansions.

Management believes, based upon its discussions with present and prospective
tenants, that many tenants, including prospective tenants new to the factory
outlet business, desire to open a number of new factory outlet stores in the
next several years, particularly where there are successful factory outlet
centers in which such tenants do not have a significant presence or where there
are few factory outlet centers. During the year, the Operating Partnership has
substantially completed expansions totaling approximately 268,000 square feet
and has five expansions totaling approximately 194,000 square feet currently
under construction (See "General Overview"). In addition, the Board of Directors
of the general partner has approved further expansions in Riverhead, NY (44,000
square feet) and Commerce, GA (33,000 square feet). Commitments for construction
of these projects (which represent only those costs contractually required to be
paid by the Operating Partnership) amounted to $17.8 million at September 30,
1997.

The Operating Partnership also is in the process of developing plans for
additional expansions for completion in 1997 and beyond and new centers for
completion in 1998 and beyond. For example, the Operating Partnership is in the
preleasing stages for future centers at two potential sites located in Concord,
North Carolina (Charlotte) and Romulus, Michigan (Detroit). However, there can
be no assurance that any of these anticipated or planned developments or
expansions will be started or completed as scheduled, or that any development
or, expansion will result in accretive funds from operations. In addition, the
Operating Partnership regularly evaluates acquisition proposals, engages from
time to time in negotiations for acquisitions and may from time to time enter
into letters of intent for the purchase of properties. No assurance can be given
that any of the prospective acquisitions that are being evaluated or which are
subject to a letter of intent will be consummated, or if consummated, will
result in accretive funds from operations.

Management intends to continually have access to the capital resources necessary
to expand and develop its business and, accordingly, may seek to obtain
additional funds through equity offerings or debt financing. The Company and the
Operating Partnership filed shelf registration statements with the SEC in
November 1995 and March 1996 providing for the issuance of up to $100 million in
additional equity securities and $100 million in additional debt securities. On
September 24, 1997, the Company completed a public offering of 1,000,000 Common
Shares at a price of $29.0625 per share, receiving net proceeds of approximately
$27.0 million. Subsequently, on October 15, 1997, an additional 80,000 Common
Shares were issued pursuant to an over-allotment option granted to the
underwriters and the Company received net proceeds of approximately $2.2
million. The net proceeds, which were contributed to the Operating Partnership
in exchange for 1,080,000 partnership units, were used to acquire, expand and
develop factory outlet centers and for general corporate purposes. On October
24, the Operating Partnership issued $75 million of senior, unsecured notes,
maturing October 24, 2004, with a coupon rate of 7.875%. The net proceeds were
used to repay substantially all amounts outstanding under the Operating
Partnership's existing lines of credit. On November 3, 1997, the Company and the
Operating Partnership filed a new registration statement with the SEC to provide
an issuance capacity under shelf registration statements back to the original
$200 million.


                                      -12-
<PAGE>

In anticipation of the offering of the senior, unsecured notes, the Operating
Partnership entered into an interest rate protection agreement on October 3,
1997, which fixed the index on the 10 year US Treasury rate at 5.995% for 30
days on a notional amount of $70,000,000. The transaction settled on October 21,
1997, the trade date of the $75 million offering, and, as a result of an
increase in the US Treasury rate, the Operating Partnership received $714,000 in
proceeds. Such amount will be amortized as a reduction to interest expense over
the life of the notes and will result in an overall effective interest rate on
the notes of 7.75%.

The Operating Partnership maintains revolving lines of credit which provide for
borrowings of up to $100.0 million, of which $31.0 million was available for
additional borrowings as of September 30, 1997. Subsequent to September 30,
1997, the Operating Partnership used the proceeds from the issuance of the
senior unsecured notes to repay substantially all amounts outstanding under the
lines of credit. Based on existing credit facilities, ongoing negotiations with
certain financial institutions and funds available under the shelf registration
statements, management believes that the Operating Partnership has access to the
necessary financing to fund the planned capital expenditures during 1997 and
1998.

The Operating Partnership anticipates that adequate cash will be available to
fund its operating and administrative expenses, regular debt service
obligations, and the payment of distributions in accordance with REIT
requirements in both the short and long term. Although the Operating Partnership
receives most of its rental payments on a monthly basis, distributions are made
quarterly. Amounts accumulated for distribution are invested in short-term money
market or other suitable instruments. Certain of the Operating Partnership's
debt agreements limit the payment of distributions such that distributions will
not exceed funds from operations ("FFO"), as defined in the agreements, on an
annual basis or 95% of FFO on a cumulative basis from the date of the agreement.

On October 9, 1997, the Board of Directors of the general partner declared a
$.55 cash distribution per partnership unit payable on November 14, 1997 to each
unitholder of record on October 24, 1997. The Board of Directors of the general
partner also declared a cash distribution of $.4955 per preferred partnership
unit on November 14, 1997 to each unitholder of record on October 24, 1997.

NEW ACCOUNTING PRONOUNCEMENTS

In February 1997, the Financial Accounting Standards Board issued SFAS #128,
Earnings Per Share, effective for fiscal periods ending after December 15, 1997.
The new standard simplifies the computation of income per unit by replacing
primary income per unit with basic income per unit. Basic income per unit will
not include the effect of any potentially dilutive securities, as under the
current accounting standard, and will be computed by dividing reported income
available to holders of general and limited partnership units by the weighted
average units outstanding during the period. Fully diluted income per unit will
now be called diluted income per unit and will reflect the dilution of all
potentially dilutive securities. Companies will be required to restate all prior
period income per unit data. The adoption of this standard by the Operating
Partnership will have no impact on the historical reported income per unit
amounts since the effect of potentially dilutive securities have been immaterial
and, therefore, have been excluded from the historical income per unit
computations.


                                      -13-
<PAGE>

FUNDS FROM OPERATIONS

Management believes that to facilitate a clear understanding of the historical
operating results of the Operating Partnership, FFO should be considered in
conjunction with net income as presented in the unaudited financial statements
included elsewhere in this report. Management generally considers FFO to be an
appropriate measure of the performance of an equity real estate investment trust
("REIT"). FFO is generally defined as net income (loss), computed in accordance
with generally accepted accounting principles, before extraordinary items and
gains (losses) on sale of properties, plus depreciation and amortization
uniquely significant to real estate. The Operating Partnership cautions that the
calculation of FFO may vary from entity to entity and as such the presentation
of FFO by the Operating Partnership may not be comparable to other similarly
titled measures of other reporting companies. FFO does not represent net income
or cash flow from operations as defined by generally accepted accounting
principles and should not be considered an alternative to net income as an
indication of operating performance or to cash from operations as a measure of
liquidity. FFO is not necessarily indicative of cash flows available to fund
distributions to unitholders and other cash needs. Below is a computation of FFO
for the three and nine months ended September 30, 1997 and 1996.

<TABLE>
<CAPTION>
                                                            Three months ended              Nine months ended
                                                                September 30,                  September 30,
                                                          ------------------------------------------------------
                                                              1997       1996                1997        1996
                                                          ------------------------------------------------------
                                                                            (In thousands)
<S>                                                          <C>         <C>                <C>          <C>    
Income before gain on sale of land and
   extraordinary item                                        $4,369      $3,924             $12,191      $11,425
Adjusted for:
   Depreciation and amortization uniquely significant
        to real estate                                        4,745       4,132              13,556       12,171
                                                          ------------------------------------------------------
Funds from operations                                        $9,114      $8,056             $25,747      $23,596
                                                          ======================================================
Weighted average units outstanding(1)                        10,835      10,611              10,786       10,611
                                                          ======================================================
</TABLE>

(1)   Assumes conversion of all preferred partnership units to general
      partnership units.

ECONOMIC CONDITIONS AND OUTLOOK

Substantially all of the Operating Partnership's leases contain provisions
designed to mitigate the impact of inflation. Such provisions include clauses
for the escalation of base rent and clauses enabling the Operating Partnership
to receive percentage rentals based on tenants' gross sales (above predetermined
levels, which the Operating Partnership believes often are lower than
traditional retail industry standards) which generally increase as prices rise.
Most of the leases require the tenant to pay their share of property operating
expenses, including common area maintenance, real estate taxes, insurance and
promotion, thereby reducing exposure to increases in costs and operating
expenses resulting from inflation. In addition, the Operating Partnership has an
interest rate protection agreement which limits the effect of changes in
interest rates on approximately $10 million of its floating rate debt through
October 1998. This agreement, combined with the existing fixed rate mortgages
and notes payable, mitigate the Operating Partnership's exposure to interest
rate risk on approximately 100% of total debt outstanding as of September 30,
1997, after giving effect to the $75 million offering of senior unsecured notes
in October 1997.


                                      -14-
<PAGE>

Approximately 81,000 square feet of space is currently up for renewal during the
remainder of 1997 and approximately 426,000 square feet will come up for renewal
in 1998. In addition, as typical in the retail industry, certain tenants have
closed, or will close, certain stores by terminating their lease prior to its
natural expiration or as a result of filing for protection under bankruptcy
laws. Certain other tenants have, or may, from time to time, request reductions
in rent to remain in operation. There can be no assurance that any tenant whose
lease expires will renew such lease or that renewals or terminated leases will
be released on economically favorable terms. Also, management may grant, from
time to time, a tenant's request for rent reduction.

The Operating Partnership's portfolio is currently 98% leased. Existing tenants'
sales have remained stable and renewals by existing tenants have remained
strong. In addition, the Operating Partnership has continued to attract and
retain additional tenants. The Operating Partnership's factory outlet centers
typically include well known, national, brand name companies. By maintaining a
broad base of credit tenants and a geographically diverse portfolio of
properties located across the United States, the Operating Partnership reduces
its operating and leasing risks. No one tenant (including affiliates) accounts
for more than 10% of the Operating Partnership's combined base and percentage
rental revenues. Accordingly, management currently does not expect any material
adverse impact on the Operating Partnership's results of operation and financial
condition as a result of leases to be renewed or stores to be released.

CONTINGENCIES

There are no recorded amounts resulting from environmental liabilities as there
are no known material loss contingencies with respect thereto. Future claims for
environmental liabilities are not measurable given the uncertainties surrounding
whether there exists a basis for any such claims to be asserted and, if so,
whether any claims will, in fact, be asserted. Furthermore, no condition is
known to exist that would give rise to a material environmental liability for
site restoration, post-closure and monitoring commitments, or other costs that
may be incurred upon the sale or disposal of a property. Management has no plans
to abandon any of the properties and is unaware of any other material loss
contingencies.

                           PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Neither the Company nor the Operating Partnership is presently involved in any
material litigation nor, to their knowledge, is any material litigation
threatened against the Company or the Operating Partnership or its properties,
other than routine litigation arising in the ordinary course of business and
which is expected to be covered by the liability insurance.

Item 6. Exhibits and Reports on Form 8-K

(a)  Exhibits

     None

(b)  Reports on Form 8-K

     None.


                                      -15-
<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                   TANGER PROPERTIES LIMITED PARTNERSHIP

                                   By:   Tanger Factory Outlet Centers, Inc.,
                                         its general partner

                                   By:      /s/ FRANK C. MARCHISELLO, JR
                                         ---------------------------------------
                                         Frank C. Marchisello, Jr.
                                         Vice President, Chief Financial Officer



DATE: November 11, 1997


                                      -16-