CLPR - Earnings call transcript Q3 2020

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Operator

Good afternoon, ladies and gentlemen, and welcome to Clipper Realty 3Q 2020 Earnings Call. At this time all participants have been placed on a listen-only mode and we'll open the floor for your questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Michael Frenz. Sir, the floor is yours.

Michael Frenz

Good afternoon, and thank you for joining us for the third quarter 2020 Clipper Realty, Inc. call. conference earnings on the me are Bistricer, David Participating and today's Chief of Board J.J. Executive Co-Chairman with call Officer; and Operating Officer. Chief Bistricer, are may differ Please the from those deemed statements that such materially statements, not forward-looking by that statements. forward-looking results be be historical actual made and indicated may aware call during XX-Q company's and company's to Form XX-Q on accessible quarters subject are uncertainties, website. quarterly statements our and XXXX report on risks and the first are www.sec.gov including at annual Form today, quarterly the for those of XXXX These report and numerous all disclosed second XX-K, reports Form in the the company's posted which on

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

may or supplemental Please management earnings AFFO; or to or adjusted net refer from for Bistricer. our financial non-GAAP EBITDA; depreciation a amortization, call certain press adjusted financial now funds to adjusted XX-Q the measures, With most and NOI. CEO, call, and this the and that, reconciliation posted comparable measures. see income, directly turn During our including today financial measures with these release, I operations, before taxes, interest, financial over of non-GAAP operating will Form Co-Chairman David information and GAAP

David Bistricer

highlights Clipper including and taken to recent Thank the you, who discuss turn call including with will JJ, the company performance I pandemic. Realty. provide for will is then milestones, measures responding quarter activity, level over how Michael. pandemic. COVID-XX business an as call line will I our in performance, property Good afternoon on to leasing earnings and third welcome as to XXXX update our well the and

performance. speak will quarterly our Michael Finally, financial about

Their been throughout Clipper We for grateful period. of continued will the business during has the residents, pandemic and their work team the entire by are I the remarkable and this take and challenging efforts. dedication our begin communities ongoing to our we perseverance then hard will thanking our questions. your course for

throughout open remained have pandemic. the and properties Our operational

to in tenants to are safe, to continue with providing take and necessary steps orders We state keep and typical services our local our residents. compliance

New third the at declines rental at broad occupancy quarter viable in operations the York the our Despite to headwinds, state the in our range end, COVID-XX. of properties York rates economic of several a we to expect New pressure current the some a by of [ph] and tenants we And on driven end to the and During of are overtime. remain compared related normal was leased properties to Market our witnessed XX% to properties we quarter, return confident activity second our resiliency quarter. City. At City XX% residential to

through perspective manage the balance a Our be from well-positioned continues liquidity to to pandemic. sheet

$XX consisting have our million of - asset-by-asset finance cash, We We million cash. $XXX cash basis unrestricted cross collateralized. million portfolio an recur is our debt of and and restricted not non-recourse and the and $XX of of on

debt properties XXXX. any no operating have our on maturities of until We

a of the share quarter, the end stock shares average had at XX,XXX common per During price million we purchased third the stock, remaining $X.X of the repurchase of $XX announced we program $X.XX under At August. quarter, onto program. weighted in repurchase million stock

one Terminal/Barclays Atlantic located redevelopment upcoming proceed about Pacific of mile developments, the from Center our the with acquisition continue Brooklyn, in Prospect to Hub. Heights, to Turning XXXX we Street

annual Together lease add portfolio, adding a City NOI. run the to end of and NOI the approval In roles Gardens X.X% substantially This add XXX our these company. significant an anticipate Uniform Land our Review XX% at provide incremental ratios cap that rent will to August. an that is to the be I'd city, significant we in $X.X area procedure XX% add and is on with approval to expected Tribeca are approximately for portfolio At a us develop increase will Street Flatbush to NOI approximate at As the with project or to update the increase XXX of rate. submitted. milestone significant to initially XXX-g two which property's approved continue of the city's JJ in There million like Street, meaningful no we the stabilized a shortly. updates representing York property's or and Livingston development. will flow years Livingston complex process lease allowing the and previously new property assurance the partially $X.X size the the litigation. ULURP million to fully annual with complete, on will [indiscernible] properties, provide to take our annual begin disclosed, House is value the $XX to an December, however, will office At would cost estimated expected commenced further add New total, approximately application of the Use expanding as the the normalized million million $X.X project the rate.

be base prior Appeals deregulation. only City complaint As is comparing events during rent permitted overcharges June Appellate case the Appeals charged Division if Guidelines by four-year the tax Juneau to On to rules four October in New New period are the discussed, of actually overcharges, XXX-g rent years City and has to receiving XXXX Court filing determined the the determination, increases XXXX, York and rent by [ph] subject any, Board. benefits, to of the Buildings a Rent really, Court that's of to applied XX, previously the of the Department luxury the

the believe Appellate have Fees ruling majority existing a financial overcharge, will rent are the and our of The are units The lower litigation, liability fees. however, litigation impacted been do liability on exposure award be that overcharged as attorney's property. this the material altogether, current back The future to expected will of this yet. the have will eliminating regard. No determine Division not courts, in movements the case to all by our court's of tenants not to limit this of tenants. substance lower court those plaintiff's at affirmed is the Although remanded which impact the eventually for amount to pertains as dates vast tenants it scheduled as We future business previous free not of limited markets. and Attorney's

comment I like on third to Lastly, would quarter results. our

NOI to Results $XX.X Michael are details quarterly the revenues will million. and and FFO the future $X.X JJ, performance our overhead to earlier. turn pandemic $XX.X over now will update our further of of provide We a targeted million, of to the expenses. headwinds reflect including current will discussed financial provide response I who an streamline reduction call on reporting shortly. million on operations

JJ Bistricer

- and inspiring. asking colleagues corporate for result certain our challenges in communities properties Thank their again been activity you. COVID-XX. as commitment to thanking revenue office declines at to economic tireless efforts has the throughout our I unwavering related and of Their by our We period. tenant a this begin in challenging quarter faced third

quarter. $XX the declines revenue total rates lower at of total several quarter square third foot Tribeca of Third was occupancy due by was at properties per quarter our at X.X% pandemic. the end in Rent the ongoing to than revenue rental and second driven

as quarter revenue at the ending term neighborhood. standpoint, given leased. buildings note quarter revenue at well the return at or up Rent surrounding it to was has House's recently property levels complex record The to XX% occupancy we quarter. pricing rental pandemic. over the We that in rates property a in the has Gardens from per third maintained attractiveness Flatbush are foot to occupancy The the the a occupancy and a other the XX%. Brooklyn diligently believe square increased pre-COVID from standpoint, throughout property the working of luxury will held manage Longer compared Tribeca $XX.XX end high that in to

expense XXth and base is property, proactively at key annual We and certain third to have compared and cost mid-XX at opportunity. Gardens quarter. some of properties pressures to the approximately the expansion XX ending excess leased Clover West the is quarter streamline Flatbush pricing in project and the growth operations value to business of which element second continue and our an due with FAR the levels $XXX,XXX. each COVID-XX, the in experienced a organized of portfolio to incremental result our end story expected savings the manage House XX% Street The occupancy

recent in at points since strong the seen uptick remained with ranging these from the activity during a have have gains XXX pandemic. however to properties quarter. of Collections occupancy the We basis XXX end

was XX%. quarter third the during rate collection rent Our

including a arrangements. continue their meet cannot obligations notify the work on basis as result of alternative us that tenants reviewing they a when with potential case by We to they rent payment pandemic, case

storey XXXX which building be market indoor square XXX,XXX property XXX affordable is tax the necessary multifamily development the a eligible will to are On fully-amenitized completing units, construct The will year nine regulatory Pacific XX% with at Street side, of XX% and abatement. and a foot, XXX-a for total rental process XX parking. underground have free we rentable

We are the of a project. loan in construction for process the negotiating

York on focused the backdrop in headwinds ongoing expenses optimizing business and Market pricing pandemic continue occupancy, New are of our we the and ahead, both City to portfolio the that Looking across driven will call results. I will against to ourselves our environment from financial to to general. now the emerge who challenging, are The turn Michael, remain pandemic. we positioning over strongly but near-term the will discuss committed pressure

Operator

has reconnecting him line Just one disconnected, moment Michael's gentlemen, now. we're

Michael Frenz

Hello.

Operator

to trying Michael Frenz's We're has Yes, this the line connect. is operator. dropped.

Michael Frenz

That's am me. back. I

Operator

you're back. Oh,

perfect. Okay,

Michael Frenz

Thanks.

David Bistricer

on. you're Michael,

Michael Frenz

Hi. Thanks, for connection problem. a guys. Apologies that had

$XX.X the House revenues in to share. $X.X the Street new $X.XX to increase House quarter or decline property total leased quarter, occupancy million, achieved Livingston Okay, of of the partially offset bringing we achieved by $XX.X lease Tribeca office AFFO property. the revenue and increase XXX of and the We during and rates residential an to of online XXXX. X.X% rental million, XXXX, for at attributable primarily Clover was of same of in third million, third The the compared year-over-year property NOI period million, $X.X the or commencement per

increased recognition of increase of property portfolio cost the Interest increases. increased driven due million Property debt third to COVID-XX. the and due expense property quarter insurance interest million On key the bad by side, online $X.X by insurance May. connection changes Real expense refinancing and their primarily Gardens in estate taxes in in provision an increases House the in primarily industry third with the year-on-year, expenses the the quarter year-on-year, as general quarter were for of by $X.X increased bringing year-over-year follows: across third in in the the due impact Clover to Flatbush and expense tax $X.X operating million by to

As earlier, David a liquidity perspective. mentioned from are we well-positioned

cash, cash. We restricted $XX of portfolio we by million unrestricted of $XXX an million September of and of asset finance consisting $XX asset of As XX, basis. million our have cash on

Our debt is collateralized. is and non-recourse cross not

XXXX. until properties operating any on maturities debt no have We

we per record a XX. $X.XXX today, dividend third amount as paid the November November on quarter, announcing on are dividend quarter. for Lastly, shareholders same be of last XX, the The share of will to

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

David Bistricer

Thank you, tenants focused efficiently Michael. remain our our are pandemic. We throughout portfolio The priority. the and safety employees of highest our operating on

through steps challenges strong the take necessary balance to to continue We by navigate sheet. the current buttressed

New have through and every including potential stay a up like York from Flatbush as for has I'd and and the confidence the safe redevelopment, line that Gardens. We questions. over everyone hope that, the [ph]. we survived thrived And myriad time. look growth open circumstances the of opportunities, capitalizing With XXXX on expansion well emerge City forward challenging to pandemic will Street actively strong city of healthy. to Pacific We the

Operator

[Operator first line you, from And question floor Craig the is Kucera. Thank and questions. live? open Instructions] is your coming for is ladies Craig, gentlemen, your

Craig Kucera

basis occupancy where that to you you Guys, the Yeah. wanted anywhere did improved a quarter? of since third that all had the Hi. seen had properties gave you from in update to to that confirm. XXX XXX Tribeca, that XX%, say the Flatbush just I other occupancy outside mentioned point

David Bistricer

X% since dipped and mid-XX% September, Hi, Greg, they we we of a the end properties, in the XX%. you? to had second up the XX% the House, between how those X%. the some were of quarter, end the XX%. By they range, occupancy anywhere from the bit the third said West, quarter, properties are as on to third bump of all Clover a quarter, end At to end But to of The X% of back see the XX today, Aspen,

leased So the are to Aspen, currently ranging properties House West XX%. XX% from XX Clover and

Craig Kucera.

basically trended great. here on I those to to follow flat Okay, rents has just quarter, fourth up there any have And or been wanted rent in in then concessions folks - the back? get

David Bistricer

you that? do to JJ, to want talk

JJ Bistricer

Sure.

we're dropped prior, to much trying simply below So the rents because - what stayed they pretty were recapture have occupancies.

So come does that when again. so we're start well the rents to positioned, market back pushing

lose apartments. and now, opportunities making the best doing rent we don't can we to any sure that for we're So

So of in because downtick there's square foot a rent slight down that. per

Craig Kucera.

for or point quarter, just me. second in or they out you these the are basically are it. New whether Got moved markets, no one market And are folks track tracking in back Are the more longer the just people they'll MSA? but are greater able to some as staying from maybe to third York future at the exiting in come that

JJ Bistricer

To answer that them numbers, cities. details - the without are the significant of a of is moving exact again, out answer amount

some suburbs. on the of And be the soon. We let's back to, to normal property way on to they the of depending looking that hope tell this. so we're have We them when the say in we get like we us property. city. the things moving And they when really to homes are out wish didn't can this second say, to Many return come to forward back them

Craig Kucera.

that's for well, Thanks, guys. it Okay, That's me. encouraging.

Operator

Instructions] life? question from [Operator coming Okay, lines your your Buck Horne. next Buck is

Buck Horne

thanks. in you the operating - that, I was Hey, expenses? quarter? bad know Hey, break just debt can quantify the Mike, you what expense Yeah. the did don't

Michael Frenz

Absolutely.

As about the third still the in given we the JJ as a high you here, took into we're in the XXs. quarter the quarter, second high - again, said, as in and of expense $XXX,XXX debt bad refresher know sort rate collections now a

quarter, lingers. a I performance, pretty $XXX,XXX pandemic, quarter. the we increase hold been proximate continue But were in XX% So up debt, surprised so good strong for pandemic collections charge to going seen overall. the what bad took everything over think is as third we've that a All-in-all given pleasantly see actually the today, and on and second with even that's again,

Operator

in [Operator no questions queue. remaining Instructions] Okay, we have

David Bistricer

again Stay We forward you Thank safe. to soon. you joining us for look today. speaking with

Operator

this Ladies you. Thank gentlemen, and today's conference call. conclude does

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

JJ Bistricer

you. Thank

Clipper Realty (CLPR) 9 Nov 202020 Q3 Earnings call transcript