Earnings call transcript Q4 2022

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Operator

Good day, ladies and gentlemen, and welcome to the Clipper Realty Fourth Quarter 2022 Earnings Call. [Operator Instructions].

It is now my pleasure to turn the floor over to your host, Larry Kreider. The floor is yours.

Lawrence Kreider

Hi. you Realty us Inc. thank Quarter the and Clipper XXXX afternoon, for for joining Fourth Good Earnings Call. Conference Participating with and me Co-Chairman of on today's call Board Chief are and Executive Officer; J.J. the David Bistricer, Bistricer, Chief Operating Officer.

historical company's materially risks that statements aware the are statements. disclosed annual and the are forward-looking made Please and indicated on those Form may may by in be deemed differ statements be results These numerous uncertainties, those report call including subject during which www.sec.gov XXXX that to not from accessible is actual and forward-looking statements, such website. our XX-K, at

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

refer adjusted to measures, or operating adjusted may financial NOI. amortization depreciation AFFO; or net management funds operations, before adjusted non-GAAP including interest, earnings taxes, income or and certain call, this and from EBITDA; During

posted Please see a financial release, information these supplemental reconciliation comparable financial our Form press financial with directly the today measures. of GAAP most for non-GAAP measures XX-K and

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

David Bistricer

activity, Thank you, fourth Clipper XXXX update call J.J., company's our the then I recent over welcome Larry. will and turn including for property-level highlights an performance. performance, who call the to to as Good will provide business including well as to Realty. our will earnings recent quarter milestones afternoon, and progress. discuss I

Larry will our Finally, performance. about financial speak quarterly

your We will then questions. take

increases risks. demand employees has strong York increasingly activity and headline largely their as on despite all recent City property continued to city results those banking been people continues Residential to their Rental rate to interest year the operating seek positive relocate to improve our reopened, returned very New leasing offices. back Our trends. is in inflation, the and

seen exceeded exceed slow XX% at pre-pandemic leased than our properties a our and the year, from end foot to units legal end end nearly leasing at quarter, per Gardens At on $XX the limit per a leases continues all continuing foot, the of record of Tribeca of XX% causing September. property, in per an lease the overall rents, all of seasonally the all have the trends House At leases fourth property, square the new foot new of better leases $XX the new period, $XX December we $XX quarter levels. previous fourth to At at $XX properties the were per not increased the 'XX. average at averaged foot versus the Flatbush rate yet leases

With which of rate duration noncross-collateralized. with by average believe respect interest XX% on long of buttressed relatively debt is years standard X.XX and nonrecourse subject of duration we and at our to to limited our an is the have operating fixed we increases, carve-outs X.XX%, properties, is

inflation, our on cover to look costs respect properties. demand higher and duration expenses to the to increased short high on operating we construction development us to residential properties our With our leases allow and for

liquidity a perspective. sheet balance be from continues positioned to Our well

unrestricted $XX $XX consisting cash, and restricted an have of portfolio million approximately We $XX asset-by-asset million finance million We in of basis. cash. of on our cash

is it noncross-collateralized. reiterate I again, And

Terminal, million or above in property million we X%. Barclays achievement excellent Due The a million with permanent available on $XX are after anticipation of refinancing Hub units. leasing $XX and loan closing, have schedule of project, progress, the came cap in announce construction XXX on is the Street quarter. February, the the with at of Atlantic $XX second to is in budget comprises financial full loan, we XXXX to Prospect located about in a $XX leasing X in We as mile operation pleased of today, ahead It Center and X-year Pacific development full that million lease-up. completed our upon replaced and from ground-up debt to Heights, schedule targets drawn rate at begun

of as lease-up. in year reduced in an with At property. the also by bps develop X.X%, same of excavation initial That August year, upon last bought project of the the we that Street the process end area, full of XX the It has intend April Brooklyn XXX comprising also this as of commenced ground-up. interest from speak properties to several Dean has we construction we and

We partially paid acquisition potentially financing $XX million funded with $XX.X for of , million.

feet, market with We X,XXX building, as square plan with residential XX% feet. expect XX-XX of commercial free XXX X-story the which XXX,XXX rentable build affordable, abatements years XX% affordable square known rental with amenitized and residential to tax units, XX fully a is

With our record fourth we exceeding quarterly million AFFO revenue above. $XX I a million, million, quarter of of of regard to reporting NOI are and $X.X leasing, result of pre-pandemic results, improved mentioned both levels $XX as

Larry the turn and further from will detail. will on call who quarter year, the J.J., last improvements will to as represent an update over operations. results These fourth now J.J. provide I

Jacob Bistricer

pleased properties this improved continued has into year you. we've and residential the fourth that fourth quarter, all to report end performance that the At experienced I the am of quarter. leasing by Thank all rates new exceeding the the renewal levels over and occupancy are fourth rents and properties, and square quarter our rent by exceeded pre-pandemic previous rental X%. per lease rental XX% in level residential over rates foot our

XX% property, experiencing We're the Tribeca occupancy House XX strong averaged leased our months. rental over last has particularly while at demand

rent average square $XX increased square foot per to steadily from foot same that have $XX over We per period.

over XX% foot, previous renewals have leases rents Over rents. on and have square rents increase over increased previous to the over XX% per $XX of rents year, representing an new last on risen

rent grow pandemic Further, steadily year result our in entered we a response leases square through into to to turnover X-year per to continue next as and X- foot year the expect conditions. of of last

continue progress retail properties new We property. Tribeca at make to House also on and leases the

year lease are our a nearing substantially the leases lease new to last space vacated We deal higher retail pandemic. remaining during rates, up the lease, up garage smaller our at have and entered gym the in renewed into firmed X

we fourth focused Since high with beginning have in quarter, we the and in At the activities. keeping Flatbush year, up are complex leased maintenance of and keeping occupancy the the averaged rented. previously the Gardens the on Brooklyn, XX% new from leases of at nearly square the units than XX% to $XX the approximately have beginning higher year, per nearly increased foot, XX% occupancy

again, to at $XX.XX a of As has end foot at the average increase rent square versus result, end to per overall $XX.XX property the to of quarter the the begun year. last rising

allowed stabilized for units X, from by leases. X-year and forth the X% Looking of on put forward, for rent which XXXX, stabilization increases leases benefit rent X.XX% and should the board, guidelines we began also X-year October

These heavily X% have limited this year. Along activities our increases reflected spent with increases last Such have to costs capital property, will been as X% help continued in couple our offset we which has $X.X the of this, for years. in investment in year-on-year. the amounted million and operating to maintenance higher

benefit to the the created reorganization savings. that continue operations XXXX in nearly of property's $XXX,XXX We from

year. increased average Street properties, Aspen Leased XX XX% these Our for residential the the exception Aspen, beginning other have to XX% Livingston Clover of averaged with Street, properties occupancy House, rental since the continued rates, of overall and West and well. perform XXth XXX

X%. the year, turnover Aspen, which up is little now had during

despite challenges collection XX% For average and the the year residual across exceeded collection the on new XX%. remained overall Rent pandemic. strong portfolio was increases increases whole fourth leases XX%. on our the The group, rate average quarter for exceeded in of renewals the over

York in or $X.X fourth in the in second lower Assistance have of million New quarter, from at first Program, but benefit in Emergency the quarter, Rental and $XXX,XXX at ERAP, remittances Rental quarter the XXXX. or LRAP, a fourth a quarter, the continued and remittances rate from the We $X.X to under in the down $XXX,XXX lower Assistance were Program quarter -- the million $X.X third million Landlord

Street of the known development Brooklyn, completed and Construction budget and property now On is rental in House on in nearly Pacific schedule. the was is construction on operation. side, the complete at Pacific substantially building as full XXXX the

first rapid leasing very with in the based demand XX We expect the the strong began TCO on leases and soon progress and already. quarter rental

is multifamily with foot, We rentable units, XXX expect XXX(a) the leased market tax be The XX% the building end The free foot fully underground X-story, indoor abatement. has parking. amenitized square square XX% second affordable and a development a quarter. and property to XX-year fully rental by of XXX,XXX has

financial remain growth. we focused business the pricing on ahead, optimizing will I call our and over Looking for the results. expenses across who ourselves discuss occupancy, best will turn position to Larry, now to

Lawrence Kreider

you, Thank J.J.

revenue deducted revenues by $XX.X last million the fourth increased comparable $X.X million $XX quarter. a more billings quarter, as to from from reported fourth by record actual a million now On For year increased million our the basis, $X.X revenue leasing for directly $X.X which excluding accounting the the year million, to expense, XXX million due opposed adoption debt is bad $XX.X XXXX. this to of ASC standards to from

commercial received, the and $XXX,XXX million, from higher quarter fourth due was expense quarter J.J. mentioned as expense quarter. Flatbush debt AFFO the the at of net property revenue increased fourth above as due NOI mentioned new rates Street but a escalation the to this year $X.X million tenants ERAP quarter. revenue reduced reduced quarter billings XXX increased last year amount Gardens million fourth increased year increase actually large $X.X $XXX,XXX to Tribeca year residential J.J., the swing payments the Bad by The from this the property. $X.X to this million. $X.X million at property, House by higher fourth to rental in quarter by for in Livingston of last $XX.X occupancy $XX.X last million at

year-over-year due the quarter. operating repairs year's were costs focus higher and the last to increased $XXX,XXX for higher from On there. bad supplies excluding maintenance This our changes key fourth the Gardens were expense as increased Property last than rates higher in debt utility expense year, at and cost Flatbush $XXX,XXX side, was charge primarily and from follows: expenses

by to costs and and year by due in fourth executive insurance the year-on-year $XXX,XXX and transition connection with salary in higher the the and Real our estate costs new quarter General due auditors. initially costs increased and from $XXX,XXX. LTIP Sarbanes-Oxley costs of amortization fourth audit approximately year-on-year costs to $XXX,XXX prior $XXX,XXX newly higher estate increased real of higher insurance in administrative increased taxes quarter taxes some required awards, to

development the Street decreased $XX XXXX unrestricted cash. interest XXX as $XXX,XXX Street $XX.X and with of with mentioned funded to Pacific construction cash projects. and sheet, Street Pacific expense in We to initially restricted our substantially financing. Dean balance million Interest capitalization due Street earlier, David of With have we acquisitions of development of associated Dean fourth regard our year-on-year quarter XXXX additional million the and

financial subject construction provided $XX to we mortgage funding million $XX the this an certain objectives. The with of that million X-year up year, In million February of initial subject to further basis of of upon and points rate loan and a refinanced has a initial loan reduction achievement Pacific XXXX $XX Street an an certain X.X%, XX targets. a achievement loan by term financial to of

loan and an asset-by-asset standard for thereafter interest amortization The first is carve-outs years property schedule. cross-collateralized. interest-only not limited our We on nonrecourse, debt X and on finance subject XX-year is a principal to the and based basis, is and our

an debt We maturities X.XX on properties with operating properties XX% and debt of the of average duration At have at years. operating an X.XX%. a at no any was of fixed of XXXX, rate our until end our average XXXX,

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

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

David Bistricer

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

David Bistricer

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

Operator

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

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

Clipper Realty (CLPR) 16 Mar 232022 Q4 Earnings call transcript