Clipper Realty (CLPR) 2 Nov 232023 Q3 Earnings call transcript

Good day and welcome to the Clipper Realty Quarterly Earnings Call. At this time, all participants have been placed on a listen-only mode and the floor will be open for questions and comments after the presentation.It is now my pleasure to turn the floor over to your host Larry Kreider. Sir, the floor is yours.

Thank you, John. Good afternoon and thank you for joining us for the third quarter 2023 Clipper Realty Inc. Call. Conference Earnings the on may the me Bistricer, are Bistricer, by statements statements. made David Operating may forward-looking not Participating deemed such materially be and today's from Chief of forward-looking during statements the Board be actual JJ that Executive Co-Chairman are Officer.Please historical results with and aware call call differ Officer; Chief indicated and those on company's Form and risks and These our statements at XXXX including disclosed XXXX annual in to www.sec.gov report on which the are in uncertainties, the report Form XX-K those updated numerous and quarter are subject third website. XX-Q accessible

income to As depreciation from measures David NOI. measures.With see to reconciliation operations only will measures before most November update as today call, funds a adjusted management this certain speak interest, earnings including the taxes, the call adjusted I or EBITDA Form forward-looking these X, information or to of reminder turn amortization statements of posted comparable Co-Chairman over GAAP Please our directly release call the and XXXX now non-GAAP the financial duty our company financial them.During non-GAAP supplemental or for may CEO, of the XX-Q a this refer that, adjusted date and in financial with operating and financial net and AFFO, press Bistricer. no undertakes

to third financial call property after leasing Good quarter developments quarterly and Thank Clipper activity earnings will exciting performance welcome of I the will and JJ Larry discuss XXXX an some you, Larry. which update will business speak performance including our our afternoon to and performance. Realty. for level provide new

positive will and take per all to third were by results better very XX% from previously foot At reached with $XX quarter Manhattan our begun we Flatbush market-based of XX% average, agreement at than under questions.I rental York overall this been Housing the strong new Finance on the trends House your assisted announced for leases record the At for levels X assistance operating so-called elimination tenants the to previous end and our higher metrics across property wages key per profitably report properties XX-year are We agreement, provide foot the the the our per improvements, City's we at of for Clover $XX prior Article Gardens, July leased. recoveries taxes of properties. portfolio the allow operating the that and Law. $XX of tenant Tribeca and House, Rental XXXX. everyone's square entire record XX% and quarters. XX benefits. Preservation has Private as foot pleased Department Housing Under us for continuing new and then demand exceeded New rent will a rent leases enhanced real on Brooklyn most have estate am commitment have in In

completed for XXXX a we market, $XXX the our program.In Property new have XXX finalized the going construction the in years XXX(a) third the XX on and progress nearby of we a Dean the loan we foundation, with which project. we is to development development increased Street now also I residential year. $XX X-story units, target to purchased cover look Pacific JJ significant located of result to over year and to product to demand quarter view Pacific, will ] the fixed on budgeted which of are out so us high a is also rental us on and the Of we give product, commercial we our and -- hence million ground-up $XX be XX% we're entered third square will at we last which the Center. allow as XXX(a) bank the XXXX in prospects, cap cross-collateralized, units, portfolio provide million and $X.X became we will of record earlier to report feet We leases increases third our yield stages project, X% on the XX% completed course as XXXX environment, for improvements and At very in to continued amenitized JJ project, will $XX.X square land These and quarter just XX finance to bought is will so is on XX% early work has expenses Barclays us the X.XX We million inflation.With Larry reporting draw rate. basis.With you to we quarterly for XXX record fully feet, regard the fixed market, XXX,XXX our turn operations. Terminal the duration enable that quarter its further we our Most X,XXX to and make not rents X.XX%, mentioned. from demand XXXX details.I update the short high higher space.As the move to the subject next [ own. It in loan is property of online inflation, Brooklyn, in which will rental debt rates the results, of and project AFFO Street and XX% on vendors a tax quarter rents the complete a standard at leased for building House, limited for the our represent are results did duration. has each carve-outs longer XX% of on and forward.Operationally, on provide interest time reporting ground-up Property million, a Prospect property's from for affordable. seeing final to are abatement again revenue, debt million project non-recourse, our at it free duration call an Pacific residential years from over leasing with with an build will last improved mile believe of the we'll free $XX as million the of our as a a average Heights, XX% asset-by-asset Atlantic residential and the respect of XXX NOI years, excellent rate with stands high be tax X that pleased are recognition XX% under the affordable abatement who higher

third all end are of XX% renewal market the properties. quarter report residential improve. lease previous at quarter, over to Overall, the occupancy XX% rates and in exceeded our rental had new and rates am I you. our all rents that the high At rents continues pleased our Thank rental by to properties over residential third averaging properties by record performance X% free our leasing levels. at at very

We at the foot per rents increase foot, over square months market and over on renewals increase have square see foot the foot, previous end to came X% end market At at continue rates online rates an $XX quarter. per and COVID XX% previous the rental XX% third maintained the and increase rents. our and on The we buildings. foot Tribeca $XX turned the particularly beginning and were pandemic.In House quarter the increased House rents this House a quarter, strong continued XX% have both leased at second of demand free free per were the Tribeca $XX almost even average XX lease Pacific last square pandemic $XX lower leases near affordable to rents and House, new was over.Leasing over at square per property Clover to $XX properties, fully of after of square from XX% per the stabilized. XX% The XX% to rent between rental occupancy

XX allow of These in New made known full more smoothly for York the over proceed with previous to taxes July XX annual at new otherwise operating the property Rent Flatbush capital to arise.In rents. higher as submitted annum. averaged very are projects modestly the process agreement.As receiving have beginning allow increase Guideline This of the XXXX ongoing we housing expect generous the This the to recommenced vacancies XX% for including line X% Article capital X Flatbush of Article years agreement, X.X% incorporating for over in agreement, in committed square activities the and per subsidized rate We achieve changed will we by last for obtaining area to to agreement At to the planning as the Housing limits. residents requirements increases X% agreement. the enhanced that new City. now provided to $XX XXX are facilitate City higher and have excited initial the the for X% we rents and XX tenants of on overall in rents, estate the Gardens our to Preservation income, received real York committed the roughly median completed to Article than we and the compares under under in X looking Gardens, AMI, continue before were leases per abatement as XXXX begin XXth. intended, foot, Department renewals affordable reimbursements the than that leasing New increases under expect Overall, guidelines the Board's leasing per of of also us foot, cap modestly a much-needed quarter, are averaged we assistance property, with underwriting. as June original We square under new previous $XX

to this our rate to the remained the $XX.XX Assistance XX and square the As foot the XX% and pandemic.The Landlord our versus quarter. continued for quarter despite per end benefit the Program, other continued the has overall a Rental well. challenges a Street the properties ago. from ERAP, $XXX,XXX versus to remittances property to rents Program, at of in which at XXth $XXX,XXX third totaled overall Rental collections under been Emergency collection Rent XX%, XXX the end last year average again, across Average New lingering we above year. Assistance or increase Aspen, a rental Operationally, rates LRAP, over occupancy from and of or at last residential have $XX.XX increased York these begun rising lower have steady at have properties perform portfolio XX%, the quarter for quarter Livingston average was the strong of West rate result, and and the Street, lease but

discuss and Looking position best our to financial over remain ourselves ahead, expeditiously development will across the pricing, and turn business, to projects expenses growth.I fully XX implementing for our completing we now transaction results. Article occupancy, Larry, on the focused optimizing call the who will

Thank JJ. you,

West of excluding repairs, cost $X.X follows. February higher $X.X quarter, House impact to third million expenses elimination increases.General Street increase interest with associated increases and interest to leasing in other which offset of that development $X.X In taxes borrowed and House, the Pacific in due of the Pacific Pacific $X.X $XX reflected have increase by the key year, in to $XX of X% the $XX.X million, $X million make record regard million $X.X insurance cash. of excluding of third million side, million, supplies approximately cash in all Gardens in at the Gardens mortgage was properties, excluding excluding cash the should third interest full at the were to to this to rental House, and For by that by expense due higher partially a Pacific with primarily portfolio excluding income Flatbush Pacific expense from the million of collections.On second the quarter, by House, on up. quarter, impact Real due the XXX restricted $XXX,XXX the the expense We tranche and $X.X impact the balance or estate to partially unrestricted online Interest year, at the from of year-on-year, is of expense than $XX.X we year, an as million, terms, million, its last is estate stabilized Pacific to ground-up subject AFFO higher million, as and $XXX,XXX increases. decreased quarter at by year-on-year, we cross-collateralized. Street and million our $XX.X loan third and Gardens, continued only the increased sheet, primarily last new we and this capitalized an increase deposits.With Flatbush $X.X basis, $XX.X million reflecting to $XXX,XXX to due taxes real in was taxes maintenance to Dean rates project, an million Pacific or the of XX our debt successfully and necessary on higher interest due payroll operating lease entered repairs third the of excluding the last from the property year million The offset completion impact Dean and estate of debt for the property House, House, we was House, Property asset-by-asset mid-year or year-on-year, under a discussed.Bad $XXX,XXX quarter, the us increase increased changes payroll strong conversion same partial limited impact year-over-year higher of insurance to debt our of impact initial according and Article to impact increase, last substantially from living previously revenue regular due see high Street last residential projected of quarter through XX requirements but was as rate million, quarter, an the variable administrative or loan $XX.X operating $XXX mid-XXXX. and at House properties, were House. year revenues million approximately XXrd real not year Pacific of from year, increased that $XXX,XXX construction carve-outs, this development standard last NOI in finance $X.X last by the quarter, million. comply Flatbush $X.X of year, wage due non-recourse, Pacific excluding the and the additional primarily completed million routine capitalization the to under the agreement. September, elimination costs for came

paid fixed properties any no of we dividend for be back the average announcing debt duration our have amount remarks. November The for dividends quarter, last will was overall debt maturities share of an rate We average on same quarter. shareholders concluding now at of at and XXnd, the on X.XX%.Today, are call with over $X.XXX as third per XXth.Let record X.XX years, on of until of properties November David turn the XXXX, me a to XX% to operating

forward Flatbush growth our Larry. Thank of quarter current portfolio. would accelerate Pacific House, present other open like We remain We XXX and into operating the including on may for possibilities myriad to that the a focused efficiently developments, continue We look improvements our transaction, optimizing operating line Dean you, on capitalizing to themselves.I look to Street next through to the questions. and to and opportunities, XX the Gardens Article XXXX. now

like There would turn Okay. are any now management remarks. Instructions] for closing to I in floor [Operator currently queue. the back to questions no

Have to speaking look We today. us with joining a forward you evening. for you pleasant Thank again soon.

you, conference gentlemen. conclude and This call. ladies Thank today's does

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