Clipper Realty (CLPR) investor relations material

Executive summary

• Residential properties achieved near-full occupancy and record-high rents, with new leases exceeding prior rents by over 7% and renewals by 5% year-over-year, driving a 9.3% increase in residential revenue to $31.9 million for Q1 2026.

• Prospect House, a new Brooklyn development, is nearly fully leased and contributed $1.7 million in revenue, though it posted a net loss of $2.3 million during initial lease-up.

• Office/commercial segment revenue declined sharply due to NYC lease terminations at 250 Livingston Street and 141 Livingston Street, with ongoing negotiations and a temporary receiver appointed at 250 Livingston.

• Sale of 10 West 65th Street completed in May 2025, resulting in a significant impairment charge in Q1 2025 and a loss on disposal in Q2 2025.

• Net loss improved to $4.2 million in Q1 2026 from $13.3 million in Q1 2025, reflecting the absence of a prior-year impairment charge and improved residential performance.

Financial highlights

• Total Q1 2026 revenues were $38.1 million, down from $39.4 million in Q1 2025, as commercial declines offset residential gains.

• Net operating income (NOI) was $20.0 million, compared to $21.8 million in Q1 2025.

• Adjusted funds from operations (AFFO) were $2.3 million, a decrease from $8.0 million year-over-year, impacted by litigation settlement costs and initial lease-up losses at Prospect House.

• Residential revenue increased by $2.7 million (9.3%), offset by a $4 million decrease in office/commercial revenue due to lease terminations.

• Net loss attributable to common stockholders was $4.2 million in Q1 2026, compared to $13.3 million in Q1 2025.

Outlook and guidance

• Strong residential demand expected to continue due to constrained NYC housing supply and limited new development, supporting further rent growth.

• Management expects further improvement at Prospect House as it is now fully leased and will contribute a full quarter of stabilized results.

• Ongoing negotiations with lenders and receivers at 250 Livingston Street and 141 Livingston Street may impact future results, with no assurance of a favorable outcome.

• Company believes current cash flows and access to capital are sufficient for at least the next twelve months, but refinancing risk remains.