<PAGE>

                                    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 JUNE 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 NO. 33-99736-01

                      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
<TABLE>
<CAPTION>


                                                                                                     Page Number
<S>                                                                                                  <C>
Item 1.  Financial Statements (Unaudited)

            Statements of Operations
                For the three and six months ended June 30, 1997 and 1996                                 3

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

            Statements of Cash Flows
                For the six months ended June 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                                                                               13

Item 6.  Exhibits and Reports on Form 8-K                                                                13

Signatures                                                                                               14
</TABLE>



                                       -2-

<PAGE>



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

<TABLE>
<CAPTION>



                                                               THREE MONTHS ENDED                   SIX MONTHS ENDED
                                                                     JUNE 30,                           JUNE 30,
                                                              1997            1996                1997           1996
                                                          ----------------------------------------------------------------
<S>                                                             <C>             <C>                 <C>            <C>    
REVENUES
   Base rentals                                                 $13,710         $12,423             $26,958        $24,718
   Percentage rentals                                               305             331                 703            598
   Expense reimbursements                                         6,202           5,210              11,599         10,545
   Other income                                                     239             225                 421            451
        Total revenues                                           20,456          18,189              39,681         36,312
                                                          ----------------------------------------------------------------
EXPENSES
   Property operating                                             6,523           5,561              12,148         11,365
   General and administrative                                     1,504           1,268               3,028          2,671
   Interest                                                       3,957           3,605               7,779          6,668
   Depreciation and amortization                                  4,615           4,164               8,904          8,107
        Total expenses                                           16,599          14,598              31,859         28,811
                                                          ----------------------------------------------------------------
INCOME BEFORE EXTRAORDINARY ITEM                                  3,857           3,591               7,822          7,501
Extraordinary item - Loss on early extinguishment
   of debt                                                          ---             ---                 ---           (831)
NET INCOME                                                       $3,857          $3,591              $7,822         $6,670
                                                          ================================================================

PER UNIT OUTSTANDING:
   Income before extraordinary item                                $.34            $.32                $.71           $.67
   Net income                                                       .34             .32                 .71            .58
                                                          ================================================================

DISTRIBUTIONS PAID PER UNIT                                        $.55            $.52               $1.07          $1.02
                                                          ================================================================

</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

                                       -3-

<PAGE>



                      TANGER PROPERTIES LIMITED PARTNERSHIP
                                 BALANCE SHEETS
                                 (In thousands)

<TABLE>
<CAPTION>




                                                                                     JUNE 30,        DECEMBER 31,
                                                                                       1997              1996
                                                                                 ------------------------------------
                                                                                      (Unaudited)          (Audited)
<S>                                                                                      <C>                <C>     
ASSETS
   Rental property, net                                                                  $348,548           $311,454
   Cash and cash equivalents                                                                2,603              2,567
   Deferred charges, net                                                                    7,560              7,846
   Other assets                                                                            11,540             10,087
                                                                                 ------------------------------------
        TOTAL ASSETS                                                                     $370,251           $331,954
                                                                                 ====================================
LIABILITIES AND PARTNERS' EQUITY
LIABILITIES
   Long-term debt                                                                        $214,890           $178,004
   Construction trade payables                                                             13,226              8,320
   Accounts payable and accrued expenses                                                    9,224              9,374
                                                                                 ------------------------------------
        TOTAL LIABILITIES                                                                 237,340            195,698
                                                                                 ------------------------------------
Commitments
PARTNERS' EQUITY
   General partner                                                                        108,355            110,657
   Limited partner                                                                         24,556             25,599
                                                                                 ------------------------------------
        TOTAL PARTNERS' EQUITY                                                            132,911            136,256
                                                                                 ------------------------------------
             TOTAL LIABILITIES AND PARTNERS' EQUITY                                      $370,251           $331,954
                                                                                 ====================================
</TABLE>


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>


                                                                                             SIX MONTHS ENDED
                                                                                                 JUNE 30,
                                                                                        1997              1996
                                                                                    -----------------------------------
OPERATING ACTIVITIES
<S>                                                                                       <C>                    <C>   
   Net income                                                                             $7,822                 $6,670
   Adjustments to reconcile net income to net cash provided by
      operating activities:
      Depreciation and amortization                                                        8,904                  8,107
      Amortization of deferred financing costs                                               504                    474
      Loss on early extinguishment of debt                                                   ---                    831
      Straight-line base rent adjustment                                                    (207)                  (707)
      Compensation under Unit Option Plan                                                    169                    169
   Increase (decrease) due to changes in:
      Other assets                                                                          (485)                 2,116
      Accounts payable and accrued expenses                                                 (150)                 1,757
                                                                                    -----------------------------------
           NET CASH PROVIDED BY OPERATING ACTIVITIES                                      16,557                 19,417
                                                                                    -----------------------------------
 INVESTING ACTIVITIES
   Acquisition of rental properties                                                      (18,000)                   ---
   Additions to rental properties                                                        (23,010)               (15,845)
   Additions to deferred lease costs                                                      (1,015)                  (903)
                                                                                    -----------------------------------
           NET CASH USED IN INVESTING ACTIVITIES                                         (42,025)               (16,748)
                                                                                    -----------------------------------
FINANCING ACTIVITIES
   Distributions paid to partners                                                        (11,336)               (10,807)
   Proceeds from notes payable                                                               ---                 75,000
   Repayments on notes payable                                                              (564)                  (480)
   Proceeds from revolving lines of credit                                                61,875                 32,201
   Repayments on revolving lines of credit                                               (24,425)               (97,727)
   Additions to deferred financing costs                                                     (46)                (3,205)
                                                                                    -----------------------------------
           NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES                            25,504                 (5,018)
                                                                                    -----------------------------------
Net increase (decrease) in cash and cash equivalents                                          36                 (2,349)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                             2,567                  5,113
                                                                                    -----------------------------------
CASH AND CASH EQUIVALENTS, END OF PERIOD                                                  $2,603                 $2,764
                                                                                    ===================================

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 June 30,
1997 and 1996 amounted to $13,226 and $7,363, respectively.
</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

                                       -5-

<PAGE>



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

1.      INTERIM FINANCIAL STATEMENTS

        The unaudited financial statements of Tanger Properties Limited
        Partnership, a North Carolina limited partnership (the "Operating
        Partnership"), have been prepared pursuant to the Securities and
        Exchange Commissions' ("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, TN, containing approximately 123,000 square feet, for an
        aggregate purchase price of $18 million. The acquisition was 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 property have been included in the results of operations
        since the acquisition date.

        During the quarter, construction continued on a 241,620 square foot
        expansion in Riverhead, NY, and stores began opening in late April 1997.
        Construction has also begun on properties in Lancaster, PA (26,000
        square feet); Commerce, GA (61,000 square feet); Sevierville, TN (50,000
        square feet) and San Marcos, TX (23,000 square feet). In addition, the
        Board of Directors of the general partner approved construction of
        another expansion in Riverhead, NY (59,000 square feet).

        Construction in progress amounted to $41.6 million and commitments to
        complete construction of new developments and additions to existing
        properties amounted to approximately $7.7 million at June 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 June 30, 1997
        and 1996 amounted to $651,000 and $166,000, respectively, and during the
        six months ended June 30, 1997 and 1996 amounted to $1,052,000 and
        $456,000, respectively.

3.      ACCUMULATED DEPRECIATION

        Accumulated depreciation at June 30, 1997 and December 31, 1996 was
        approximately $55,233,000 and $46,907,000 respectively.


                                       -6-

<PAGE>




4.      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 the preferred partnership units to general
        partnership units as of the beginning of the year would have been
        anti-dilutive.

<TABLE>
<CAPTION>


                                            Three Months Ended                    Six Months Ended
                                                 June 30,                             June 30,
                                           1997              1996              1997               1996
                                    ------------------------------------------------------------------------
<S>                                           <C>              <C>                <C>             <C>       
Applicable preferred distributions            $496,000         $636,000           $908,000        $1,283,000
Weighted average units                       6,742,885        6,335,111          6,724,528         6,313,197
                                    ========================================================================
</TABLE>

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

<TABLE>
<CAPTION>

                                                              June 30,           December 31,
                                                                1997                 1996
                                                         ----------------------------------------
<S>                                                               <C>                   <C>      
General partnership units                                         6,742,885             6,602,510
Limited partnership units                                         3,033,305             3,033,305
Preferred partnership units, held by the general partner             90,839               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
        general and limited partnership 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>




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 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.

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 six months ended June 30,
1997 with the three and six months ended June 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 the Five Oaks Factory
Stores center located in Sevierville, TN, containing approximately 123,000
square feet, for an aggregate purchase price of $18 million. During the quarter,
construction continued on a 241,620 square foot expansion in Riverhead, NY, and
stores began opening in late April 1997. Construction has also begun on
expansions in Lancaster, PA (26,000 square feet); Commerce, GA (61,000 square
feet); Sevierville, TN (50,000 square feet) and San Marcos, TX (23,000 square
feet). In addition, the Board of Directors approved construction of another
expansion in Riverhead, NY (59,000 square feet).

                                       -8-

<PAGE>




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

<TABLE>
<CAPTION>


                                                              Three Months Ended                         Six Months Ended
                                                                    June 30,                                  June 30,
                                                               1997           1996                     1997              1996
                                                  ---------------------------------------------------------------------------
<S>                                                           <C>            <C>                      <C>               <C>  
GLA at end of period (000's)                                  3,993          3,652                    3,993             3,652
Weighted Average GLA(a) (000's)                               3,917          3,612                    3,850             3,577
Outlet centers in operation                                      28             27                       28                27
New centers opened                                              ---            ---                      ---               ---
New centers acquired                                            ---            ---                        1               ---
Centers expanded                                                  1              3                        1                 4
States operated in at end of period                              22             22                       22                22

     Per square foot
Revenues
     Base rent                                                $3.50          $3.44                    $7.00             $6.91
     Percentage rentals                                        0.08            .09                      .18               .17
     Expense reimbursements                                    1.58           1.44                     3.01              2.95
     Other income                                              0.06            .06                      .11               .13
          Total revenues                                       5.22           5.03                    10.30             10.16
                                                  ---------------------------------------------------------------------------
Expenses
     Property operating                                        1.67           1.54                     3.16              3.18
     General and administrative                                0.38            .35                      .79               .75
     Interest                                                  1.01           1.00                     2.02              1.86
     Depreciation and amortization                             1.18           1.15                     2.31              2.27
          Total expenses                                       4.24           4.04                     8.28              8.06
Income before extraordinary items                             $0.98          $0.99                    $2.02             $2.10
                                                  ===========================================================================
</TABLE>

(A) GLA WEIGHTED BY MONTHS OF OPERATIONS

RESULTS OF OPERATIONS

COMPARISON OF THE THREE MONTHS ENDED JUNE 30, 1997 TO THE THREE MONTHS ENDED
JUNE 30, 1996

Base rentals increased $1.3 million, or 10%, in the 1997 period when compared to
the same period in 1996 primarily as a result of the 8% increase in weighted
average GLA. Base rentals increased approximately $500,000 due to the effect of
a full year's operation of expansions completed in 1996 and approximately
$800,000 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 94% in
the 1996 period to 95% in the 1997 period due primarily to a reduction in
nonreimbursable property operating expenses.


                                       -9-

<PAGE>



Property operating expenses increased by $962,000, or 17%, in the 1997 period as
compared to the 1996 period and, on a weighted average GLA basis, increased 8%
to $1.67 from $1.54 per square foot. The increases are due primarily to higher
advertising and promotional expenses incurred during the 1997 period compared to
the 1996 period.

Interest expense increased $352,000 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 (see
"Overview" above) and expansions to existing centers. Depreciation and
amortization per weighted average GLA increased from $1.15 per square foot to
$1.18 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 SIX MONTHS ENDED JUNE 30, 1997 TO THE SIX MONTHS ENDED
JUNE 30, 1996

Base rentals increased $2.2 million, or 9%, in the 1997 period when compared to
the same period in 1996 primarily as a result of the 8% increase in weighted
average GLA. Base rent increased approximately $1.1 million due to the effect of
a full year's operation of expansions completed in 1996 and approximately
$950,000 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 $783,000, or 7%, in the 1997 period as
compared to the 1996 period. However, on a weighted average GLA basis, property
operating expenses decreased to $3.16 from $3.18 per square foot. The decrease
is primarily due to lower common area maintenance expenses as a result of a
milder winter season in the 1997 period compared to the 1996 period.

Interest expense increased $1,111,000 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 (see
"Overview" above) and expansions to existing centers. Depreciation and
amortization per weighted average GLA increased from $2.27 per square foot to
$2.31 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.

LIQUIDITY AND CAPITAL RESOURCES

Net cash provided by operating activities was $16.5 and $19.4 million for the
six months ended June 30, 1997 and 1996, respectively. The decrease of $2.9
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 $25.3 million the first six months of 1997
compared to the first six months of 1996 due primarily to the acquisition of the
outlet center in Sevierville, Tennessee and continued construction of the
Riverhead expansion. Net cash from financing activities increased $30.5 million
as a result of the incremental financing used for the acquisition in addition to
an increase in construction activity during the 1997 period compared to the 1996
period primarily for the continued construction of the Riverhead expansion.

                                      -10-

<PAGE>



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. Currently, five expansions totaling
approximately 400,000 square feet are currently under construction (See "General
Overview"). Commitments for construction of these projects (which represent only
those costs contractually required to be paid by the Operating Partnership)
amounted to $7.7 million at June 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 three potential sites located in
Concord, North Carolina (Charlotte), Romulus, Michigan (Detroit), and Ashburn,
Virginia (Washington, D.C.) 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 Operating
Partnership, together with its general partner and majority owner, Tanger
Factory Outlet Centers, Inc. (the "Company"), have an active shelf registration
with the SEC providing for the issuance of up to $100 million in additional
equity securities and $100 million in additional debt securities. In addition,
the Operating Partnership maintains revolving lines of credit which provide for
borrowings of up to $95.0 million, of which $29.7 million was available for
additional borrowings as of June 30, 1997. Based on existing credit facilities,
ongoing negotiations with certain financial institutions and funds available to
both the Operating Partnership and the Company under the shelf registration,
management believes that the Operating Partnership has access to the necessary
financing to fund the planned capital expenditures during 1997.

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 July 10, 1997, the Board of Directors of the Company declared a $.55 cash
distribution per general and limited partnership unit payable on August 15, 1997
to each unitholder of record on July 25, 1997. The Board of Directors of the
Company also declared a cash distribution of $.4955 per preferred partnership
unit payable on August 15, 1997 to each unitholder of record on July 25, 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 number of

                                      -11-

<PAGE>



general and limited partnership 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.

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 six months ended June 30, 1997 and 1996.

<TABLE>
<CAPTION>


                                                              THREE MONTHS ENDED                      SIX MONTHS ENDED
                                                                    JUNE 30                                JUNE 30
                                                        ------------------------------------------------------------------
                                                              1997          1996                     1997            1996
                                                        ------------------------------------------------------------------
                                                                                (In thousands)
<S>                                                          <C>           <C>                      <C>             <C>   
Income before extraordinary item                             $3,857        $3,591                   $7,822          $7,501
Adjusted for:
   Depreciation and amortization uniquely significant
        to real estate                                        4,574         4,129                    8,811           8,039
                                                        ------------------------------------------------------------------
Funds from operations                                        $8,431        $7,720                  $16,633         $15,540
                                                        ==================================================================
Weighted average units outstanding(1)                        10,688        10,602                   10,688          10,605
                                                        ==================================================================

</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

                                      -12-

<PAGE>



through October 1998. This agreement, combined with the existing fixed rate
mortgages, mitigate the Operating Partnership's exposure to interest rate risk
on approximately 74% of total debt outstanding as of June 30, 1997.


Approximately 164,000 square feet of space is currently up for renewal during
the remainder of 1997 and approximately 436,000 square feet will come up for
renewal in 1998. The Operating Partnership's portfolio is currently 97% leased,
but down approximately 2% since December 1996 primarily as a result of certain
tenants closing stores from the early termination of their lease or after filing
for protection under bankruptcy laws. However, 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. Although there can be no assurance that any tenant whose
lease expires will renew such lease or that terminated leases will be re-leased
on economically favorable terms, management currently does not expect any
material adverse impact as a result of these leases up for renewal, bankruptcy
filings or notices of store closings. 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.

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 Operating Partnership nor the Company 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




                                      -13-

<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:  August 5 1997

                                      -14-

<PAGE>