Clipper Realty (CLPR) 14 Mar 242023 Q4 Earnings call transcript

Good day, and welcome to the Clipper Realty Quarterly Earnings Call. [Operator Instructions] It is now my pleasure to turn the floor over to your host, Larry Kreider. Sir, the floor is yours.

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

forward-looking the of XX, and duty reminder, As only date the speak no a of the statements this as undertakes them. call, XXXX, to March update company

Please GAAP adjusted management During and AFFO, call, our including earnings net and of these supplemental financial adjusted certain NOI. posted from may for the or with this or financial non-GAAP adjusted financial depreciation measures, comparable measures release, EBITDA see refer to taxes, most before operating a or information operations, interest, today funds amortization, press directly measures. non-GAAP reconciliation XX-K Form income financial and

I that, and call David over CEO, and turn will the Chairman Co-Chairman our Bistricer. -- to our now With

summary new you, our some performance will afternoon. financial Welcome to a Call for to quarterly including Larry our the of Thank discuss developments, existing performance. leasing Clipper after Realty. activity, Larry. which and speak will property-level provide Quarter some XXXX business I And will Fourth Good Earnings of J.J. performance.

X% that entire record the at has we and We properties strong the demand will income quarter, reported properties. to Rental report from AFFO, your rents the our were prior In have positive portfolio, continues to take all trends continuing quarters. leased. by exceeded Livingston previous across then pleased questions. I'm market-based our and XX% operating fourth the be

XX at XX% leases House Tribeca and House, levels, Clover House, Brooklyn, property better rent $XX end at the square at in foot XXXX. and overall property of new at $XX for square the per Clover foot in levels than December record the were $XX remained As House Tribeca Manhattan

operating as since Article the known under profitably Gardens, New and rental Flatbush estate for for assisted are property our the agreement announced, Private tenants enhanced XX-year Under us we for recoveries York of elimination Law allow City of development. a taxes XX, At Housing Finance in real should according agreement, July, to as provide preservation and housing this previously wages. persistence improvement the Article to communities higher XX and

units, ground-up Brooklyn of we Of budget stages we last reporting leased Brooklyn, are target course, forward. XXX X% at development for The XX Pacific XXX% a years. of Barclays Street Atlantic property to XXXX rate. in at our as X House has move in we market mile are and located the is and pleased a is the The Operationally, quarter free about and early progress Pacific XX% affordable yield report and Prospect on Center. that property on cap Terminal Heights, this our from online XX% to came tax-abated

the building commercial increase the for tax-abated XX% free We XXX to construction with $XXX nearby and rental units, we utilizing XX% amenitized the XXXX the on which closed this is construction scheduled, underway, a also 'XX, is At XXX XX purchased of Street feet, the land X,XXX years. again, fully build rentable And of square which in X-story for quarter. square feet. to residential square XXX,XXX as Dean market, last season, are feet affordable, development, we completing superstructure leasing on time XXXX ground-up loan expected million

by [ product of versus bolstered operating and the properties. at interest high are debt duration the environment, our continued As rates relatively high our option we long we believe significance the for ] the for rate higher makes purchase rental

duration of by non-recourse, properties any properties. average an at fixed finance asset-by-asset carve-outs subject is Our cross limited on XX% standard to debt the is X.X We and of and basis. collateralized rate years one an average that X.X% not of

Larry With leases to increased we a With detail. fourth us of to expenses. cover the operating of reporting recognizing represent million, respect and $XX operation. significant just are of an fourth quarter over result J.J. $X.X record $XX.X reduction allow million These last strong We residential our a for and high revenue as the look as the regard to to results and improvements I cost the short leasing will million, AFFO at quarter and to further duration of results, quarterly year NOI demand mentioned.

to over the update call an on provide I operations. now will J.J., who will turn

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

demand and in We future significant overall in absence the remains the expect as remain strong rental of and we new as and developments housing House, Tribeca leasing publicized. very supply high At per square Clover and foreseeable widely to XX% maintained House remains constrained the the last end per $XX near have of foot pandemic. between to from square occupancy average leased over foot foot XX% the rent increased $XX square $XX months XX to per

of fully At the XX% at free The affordable is leased development came second almost XXX% property Pacific House, quarter. market quarter our online the and XX% was of and the beginning new stabilized. property, end this at

a cap the expect with achieve line property rate original in XXXX underwriting. in We over X% to

Law to June real obtaining assistance. X, are of XX agreement The the and enhanced Department pleased committed, full improve new was profitably for begun to begun Finance begun with reimbursement capital receive have homes completing the of Gardens the the receiving Housing we the the have completed Preservation XXX projects formerly allow ] At under operating Article beginning made us property, tenants York that [ have be XX, Section property. benefits taxes we Private under Housing received we will City abatement we the estate placing Flatbush residents New of July XXXX. the on

We tenants the on increases level couple are rent board getting at the the from been of guideline years nonassisted have annum. last permitted where per for X% also increases

As the a last end result, the the the at square overall average the of $XX.XX versus to for per are foot end $XX.XX of increasing, year. rising rents property at quarter

XXth a Operationally, occupancy perform increased have have for properties XX% and above West Street, Livingston incremental XXX has Average ago. properties rates to Street at and lease our well. been other Aspen, continue residential XX year XX% from these

across seasonally XX% levels. quarter high collection despite overall as rate at the remain challenges in the Rent expected lingering The pandemic. our fourth the portfolio of collections was over

optimizing best growth. and expenses completing development occupancy, position business, on projects Looking for ahead, the we our across best and fully ourselves implementing -- remain to expeditiously transaction pricing, the XX to the focused Article

I will financial turn now Larry, who our over to the will call discuss results.

Thank you, J.J.

For of the in million $X.X House or increase last fourth $X.X excluding an by to second quarter, came million. that $XX the quarter record from million online increased a quarter, fourth $X.X impact the revenues million of Pacific

last reflected of million, House, lease-up. full online, the of million, and NOI going $X.X this from year $XX $X.X impact of year expense partial million the million last was increase but this Pacific increased AFFO quarter impact excluding $X $X.X which or interest excluding from an Pacific million to or since million, only year was House. $X.X initial

was to debt a due at For increased Pacific and $X.X commercial the higher million of $XX.X or primarily revenue same last in increase properties House. replaced. the by being residential Aspen residential by That This quarter, stabilized the excluding A strong reflecting year, fourth rates expense X% a revenue all leasing rental as was increase, to million rental substantially property $XXX,XXX that leases discussed. previously for caused million continued the $X was of from collections. decline couple income are high impact

Flatbush to changes the to as property by impact repairs follows: Article side, were comply utilities the at primarily with Gardens under key necessary mostly to costs, maintenance lower and and due compared XX year-over-year property operating On flat the Pacific were excluding to payroll the make higher last expenses House, expense requirements year, offset of wage and transaction. repairs quarter-on-quarter

approximately insurance due taxes in impact at to for of by other routine for Flatbush million House, estate taxes estate real by $X.X $XXX,XXX partially and cost Gardens, increases year-on-year, of real taxes the $X.X fourth elimination excluding at insurance the Pacific in the and quarter $XXX,XXX increases. million Real estate decreased offset properties

and West capitalized audit year-on-year, Pacific excluding in the the impact XXth due and costs the expense the of of at costs and debt lower conversion General elimination $XXX,XXX compensation-related year-on-year its the according Pacific property of primarily due the decreased for House. Interest interest expenses. to to terms increased XX to variable rate House fourth in quarter administrative fourth to by by quarter $XXX,XXX

balance our sheet. to regard With

the have we quarter, cash new loan under million million and fourth had last unrestricted draws construction In Street $XX.X closed quarter other no that $XX.X for the debt than We of we Dean our property activity development. restricted of cash.

basis. an our asset-by-asset portfolio on financed We

and at to The at our average XX% X.X debt debt of Our years an our our and cross-collateralized. debt of million subject duration is rate of rate X.XX%. X.X nonrecourse not operating carve-outs fixed properties standard limited of is operating -- operating is is average properties

of paid last $X.XXX quarter, are the X, share as Today, amount of a to will dividend XX, shareholders we April for record on on XXXX. March be fourth XXXX, per same dividend announcing the The quarter.

call Let the remarks. David concluding to turn me back for

forward growth of may XXX [ tenant, our on Article other XXXX the is We Thank We look including the XXX our House end of lease, portfolio. capitalize efficiently for itself. continue opportunities, that to forward Pacific you, to transition Livingston improvements which on optimizing current remain ] We coming and up Larry. look We a Dean properties transaction, Street capitalizing the at myriad the into around operating through XX of 'XX. to present and focused operating handled XXXX. DPS look developments possibilities

quarter. Thank you you. look to forward seeing in next the We

The Instructions] James. Raymond question Buck from first [Operator Horne comes with

and New lease with and just that I if could the the York to of plans was the Livingston the notification start vacate. wondering situation with we XXX City

some through you are sense point you can a retenant realistic? of options is the what at your or re-leasing next the space make consider on to not you handing Does $XXX to have terms mortgage what Do us building just the keys property. -- in are out steps million either the trying the back? walk it Just if

premature building square had [indiscernible]. a feet building, other of at Recast The basically told the in We that for prime the that's XXX the the occupation us. have from we on city was We looking this and XXX-something is -- is all building new is ] leases XXX city, a think organizes for a conversation. -- [ about for a type thousand marketplace candidate

working we're would But no to get improvement There's opportunity. our have diligently we that awarded guarantee, of building. will be into be That tenant try right obviously, now. an we to that that what

we renovate We a be able accommodate if are tenant. in new to that position to a to, had to building

have an think relationship cost the to We that's most the the Recast one the excellent good in basis for. a that marketplace be aggressively many, the looking in we to in many years. that the for at one with compete the And we're particular that That's that attend have in we're marketplace, rent building on they're and able only position focused moment. I very many, to over option,

cost put Do would Livingston, to you any improvements or CapEx cost to that the what for range ready realistically idea additional XXX tenant a the the get investment have what on in new any tenant? that in

But because be the met It's condition for by it with we we tenancy. the yet yet whatever of tenant. building would particular and the for doing is a this obviously not rent a fair the conversation. to a the that usually, got making None granular building the with very rent work high way haven't under would [indiscernible] were marketplace

be invest on return we that tested a to will it. investment. by money money property fair to that to building equity surrounding on Any commensurate always return just in the throwing We were back the get

It will accredited be accredited because So all lease. leases tenant it are and a good be lease long-term credit. for will

and creditors things, X those the amount. with commensurate also be will that So

looking that they're lot are This that an look a do operation Usually luxury a a very, types above more commercial I bit think, improvements. to for. kind is very, is agencies the what most not of of

goes more that. see we will it So we'll Right have details than now, on.

to something when report will we We have report.

may goes now, building the income account. until revenue before into that you -- works booking for from requirements again? And continue start escrow Is this what revenue the an any how from satisfied and the -- be building can

revenue. the is the revenue Nothing The stop can revenue.

It's by an taxable yes, and So not by escrow that been it revenues at our be to yet. whatever that determined be is. the tax it's least revenue. Whether reported the going has the account, will company, company there's

And noting larger estimates longer-term a a where balance of make sheet guess, consideration some the is. and of there stock bigger Is one property trading thought proceeds shares look or it to to my repurchases? of I to try -- what at sale is picture, potential delever sense our company are the in deploy to a last even or just relative the the and/or just does potentially a either NAV

yet market haven't for been considered yet the the We value has stock, That quite ], Obviously, that that [ the yet is has overall the discussed of the time. indicative where been property. of you're some I yet not price at comments The discussion think, where stock is. referencing. it

closing the to like now floor [Operator back remarks. Instructions] to management for would I turn

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

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

disconnect day. this at time, and your wonderful for Thank a your may phone you participation. have lines You