Clipper Realty Inc (CLPR) Reports Q3 2023 Earnings: Record Revenues and NOI Amidst Net Loss
Clipper Realty Inc (NYSE:CLPR) reported record quarterly revenues of $35.1 million for Q3 2023
The company's net operating income (NOI) reached a record $20.0 million for the same period
Despite these records, the company reported a quarterly net loss of $2.3 million
Adjusted funds from operations (AFFO) also hit a record at $6.3 million for Q3 2023
Clipper Realty Inc (NYSE:CLPR), a leading owner and operator of multifamily residential and commercial properties in the New York metropolitan area, announced its financial and operating results for the third quarter ended September 30, 2023, on November 2, 2023.
Financial Performance and Highlights
The company reported record quarterly revenues of $35.1 million, a 7.1% increase from the $32.8 million reported during the same period in 2022. The increase was primarily driven by higher rental rates at all residential properties. However, commercial income saw a slight decrease of 0.8% due to a small number of commercial leases that expired during 2023.
Despite the record revenues, Clipper Realty Inc (NYSE:CLPR) reported a net loss of $2.3 million for Q3 2023, compared to a net loss of $2.8 million for the same period in 2022. The adjusted change was primarily attributable to increased rental revenue and lower real estate taxes, net of higher property operating expenses, insurance, and interest expense.
On a brighter note, the company's net operating income (NOI) reached a record $20.0 million for Q3 2023, and adjusted funds from operations (AFFO) also hit a record at $6.3 million for the same period.
CEO Commentary
The third quarter of 2023 for the Company has produced record performance across all key metrics, including quarterly revenue, NOI and AFFO. We have now had five straight quarters of record revenue. This is indicative of the strength of the current rental market and our portfolio. New leases continue to rent at more than 12% over previous ones and renewals at almost 7%. This has resulted in record revenue for the quarter, even when we remove the revenue from our newly opened Pacific House building. In the third quarter, we recorded record revenue of $35.1 million, NOI of $20.0 million, and had same store leased occupancy of 98.4% and our overall collection rate remains high at 98.0%. We are also very excited about our Dean Street development. During the quarter we closed on a construction loan that will enable us to complete the project as timely as 1010 Pacific House. Closing such a loan in this market is no small feat and is a sign of the strength of the projects prospects and the strong development record we have in delivering projects on time and on budget. We are also excited to begin operations at our Flatbush Gardens property under the new Article 11 transaction with New York City that we announced last quarter. The abatement of real estate taxes and enhanced rental recoveries this provides should allow us to profitably provide property improvements and tenant assistance for the benefit of all. We continue to feel that we are executing on all past communicated strategies and are confident in our ability to create long-term value. - David Bistricer, Co-Chairman and Chief Executive Officer
Balance Sheet and Dividend
As of September 30, 2023, the company's notes payable (excluding unamortized loan costs) was $1,211.9 million, compared to $1,171.2 million at the end of 2022. The increase was primarily due to the Pacific House loan entered during the first quarter and an additional $20 million borrowed under this loan in the third quarter.
The company declared a third quarter dividend of $0.095 per share, the same amount as the last quarter, to shareholders of record on November 14, 2023, payable on November 22, 2023.
Explore the complete 8-K earnings release (here) from Clipper Realty Inc for further details.
This article first appeared on GuruFocus.
