CLPR · Clipper Realty Inc.

Clipper Realty Inc.'s Q1 2026 results showed resilience in residential operations amid commercial challenges. Residential revenues rose 9.3% to $31.9 million, driven by strong leasing with new free market leases exceeding prior rents by 7% and renewals by over 5%, achieving record occupancy levels across major properties. The newly completed Prospect House at 953 Dean Street reached full lease-up by quarter-end, averaging 65% occupancy and contributing $1.7 million in revenue despite a $2.3 million net loss due to leasing ramp-up costs. CEO David Bistricer highlighted continued strong renter demand and progress on lender issues at 250 Livingston Street. However, commercial revenues dropped sharply to $6.2 million from $10.2 million, primarily from the NYC lease termination in August 2025, leaving the property reliant on 36 residential units and generating only $0.4 million revenue versus $4.6 million prior year. The company ceased debt service payments post-termination, is negotiating a Consent and Cooperation Agreement with the lender, and began receiving reimbursements in May 2026; a receiver was appointed April 29, 2026. A $3.6 million litigation settlement charge for payroll practices further pressured results, alongside higher utilities expense. Overall, income from operations swung to a $4.4 million profit from a $23.6 million loss, aided by the absence of a $33.8 million impairment at sold 10 West 65th Street property. AFFO fell to $2.3 million due to commercial weakness and Prospect House ramp-up, but the unchanged $0.095 dividend signals confidence in core residential cash flows. Balance sheet remains leveraged with $1.28 billion notes payable, cash down to $26.1 million.