CLPR Clipper Realty Inc

Clipper Realty Inc. (NYSE: CLPR) (the “Company”), a leading owner and operator of multifamily residential and commercial properties in the New York metropolitan area, today announced financial and operating results for the three months ended December 31, 2024.

Highlights for the Three Months Ended December 31, 2024

• Record quarterly revenues of $38.0 million for the fourth quarter of 2024
• Quarterly income from operations of $10.7 million for the fourth quarter of 2024
• Record net operating income (“NOI”)1 of $22.5 million for the fourth quarter of 2024
• Quarterly net loss of $1.1 million for the fourth quarter of 2024
• Record adjusted funds from operations (“AFFO”)1 of $8.1 million for the fourth quarter of 2024
• Declared a dividend of $0.095 per share for the fourth quarter of 2024

David Bistricer, Co-Chairman, and Chief Executive Officer, commented,

“The Company continued to grow its revenue, NOI and AFFO in the fourth quarter of 2024, producing record results for all these metrics on the basis of our very strong residential leasing. We continue to have high occupancy and good renter demand in our buildings. For all our properties, new leases exceeded previous rents by nearly 10% and renewals by nearly 6%. At Flatbush Gardens, as a result of the Article 11 agreement with New York City, we are continuing to increase enhanced rental recoveries under Section 610 as we continue to make the committed capital improvements and other improvements in the property. At our 250 Livingston Street property, where we previously disclosed New York City’s notification of its intention to vacate in late August 2025, we continue to actively seek solutions and pursue opportunities. At our nearby 141 Livingston Street property, we are in active discussions for a lease renewal. Our Dean Street new development continues to progress ahead of schedule, and we are confident of an on-time completion early this year to capture the 2025 leasing season. Lastly, we continue to consider recycling properties in our portfolio to maximize performance and improve cash flow. As such, we are continuing marketing activities for some of our properties, including our 10W 65th Street property, which, while potentially resulting in some loss compared to book value, would allow us to achieve better overall returns going forward. We will announce any definitive arrangements promptly as they arise.”

Financial Results for the Three Months Ended December 31, 2024

For the fourth quarter of 2024, revenues increased by $3.2 million, or 9.1%, to $38.0 million as compared to revenue of $34.9 million during the fourth quarter of 2023. Residential revenue increased by $2.9 million, or 11.6%, driven by higher rental rates and occupancy at all our residential properties partially offset increased bad debt expense at the Flatbush Gardens property. Commercial income increased by $0.2 million, or 2.5%, in the fourth quarter of 2024 due to higher escalation income at our 250 Livingston office property.

For the fourth quarter of 2024, net loss was $1.1 million, or $0.05 per share compared to net loss of $2.9 million, or $0.09 per share, for the fourth quarter of 2023. The lower net loss as compared to last year was primarily due to increased rental revenue discussed above, partially offset by higher property taxes at properties other than Flatbush Gardens and, at Flatbush Gardens, higher payroll costs from “prevailing wage” requirements under the Article 11 transaction, an increase in repairs and maintenance workers, and higher depreciation expense from capital spending.

For the fourth quarter of 2024, AFFO was $8.1 million, or $0.19 per share, compared to $6.3 million, or $0.15 per share, for the fourth quarter of 2023. As discussed above, the increase was primarily due to increased rental revenue partially offset by higher property taxes and higher payroll costs.

1 NOI and AFFO are non-GAAP financial measures. For a definition of these financial measures and a reconciliation of such measures to the most comparable GAAP measures, see “Reconciliation of Non-GAAP Measures” at the end of this release.

Balance Sheet

At December 31, 2024, notes payable (excluding unamortized loan costs) was $1,275.4 million, compared to $1,219.0 million at December 31, 2023. The increase was primarily due to draws made on Dean Street development construction loan.

Dividend

The Company today declared a fourth quarter dividend of $0.095 per share, the same amount as last quarter, to shareholders of record on March 19, 2025, payable April 3, 2025.

Conference Call and Supplemental Material

The Company will host a conference call on February 18, 2025, at 5:00 PM Eastern Time to discuss the fourth quarter 2024 results and provide a business update. The conference call can be accessed by dialing (800) 346-7359 or (973) 528-0008, conference entry code 225351. A replay of the call will be available from February 18, 2025, following the call, through March 4, 2025, by dialing (800) 332-6854 or (973) 528-0005, replay conference ID 225351. Supplemental data to this press release can be found under the “Quarterly Earnings” navigation tab on the “Investors” page of our website at www.clipperrealty.com. The Company’s filings with the Securities and Exchange Commission (the “SEC”) are filed at www.sec.gov under Clipper Realty Inc.

About Clipper Realty Inc.

Clipper Realty Inc. (NYSE: CLPR) is a self-administered and self-managed real estate company that acquires, owns, manages, operates, and repositions multifamily residential and commercial properties in the New York metropolitan area, with a portfolio in Manhattan and Brooklyn. For more information on the Company, please visit www.clipperrealty.com.

Forward-Looking Statements

Various statements contained in this press release, including those that express a belief, expectation or intention, as well as those that are not statements of historical fact, are forward-looking statements. These forward-looking statements may include estimates concerning capital projects and the success of specific properties. Our forward-looking statements are generally accompanied by words such as "estimate," "project," "predict," "believe," "expect," "intend," "anticipate," "potential," "plan" or other words that convey the uncertainty of future events or outcomes. The forward-looking statements in this press release speak only as of the date of this press release.

We disclaim any obligation to update these statements unless required by law, and we caution you not to rely on them unduly. We have based these forward-looking statements on our current expectations and assumptions about future events. While our management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties), most of which are difficult to predict and many of which are beyond our control and which may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. For a discussion of these and other important factors that could affect our actual results, please refer to our filings with the SEC, including the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2024, and other reports filed from time to time with the SEC.

 

Clipper Realty Inc.

Consolidated Balance Sheets

(In thousands, except for share and per share data)

   

 

December 31, 2024

 

 

December 31, 2023

 

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

Investment in real estate

 

 

 

 

 

 

 

 

Land and improvements

 

$

571,988

 

 

$

571,988

 

Building and improvements

 

 

736,420

 

 

 

726,273

 

Tenant improvements

 

 

3,366

 

 

 

3,366

 

Furniture, fixtures and equipment

 

 

13,897

 

 

 

13,278

 

Real estate under development

 

 

146,249

 

 

 

87,285

 

Total investment in real estate

 

 

1,471,920

 

 

 

1,402,190

 

Accumulated depreciation

 

 

(243,392

)

 

 

(213,606

)

Investment in real estate, net

 

 

1,228,528

 

 

 

1,188,584

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

19,896

 

 

 

22,163

 

Restricted cash

 

 

18,156

 

 

 

14,062

 

Tenant and other receivables, net of allowance for doubtful accounts of $258 and $234, respectively

 

 

6,365

 

 

 

5,181

 

Deferred rent

 

 

2,108

 

 

 

2,359

 

Deferred costs and intangible assets, net

 

 

5,676

 

 

 

6,127

 

Prepaid expenses and other assets

 

 

6,236

 

 

 

10,854

 

TOTAL ASSETS

 

$

1,286,965

 

 

$

1,249,330

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND EQUITY (DEFICIT)

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

Notes payable, net of unamortized loan costs of $9,019 and $13,405, respectively

 

 

1,266,340

 

 

 

1,205,624

 

Accounts payable and accrued liabilities

 

 

18,731

 

 

 

20,994

 

Security deposits

 

 

9,067

 

 

 

8,765

 

Other liabilities

 

 

7,057

 

 

 

6,712

 

TOTAL LIABILITIES

 

 

1,301,195

 

 

 

1,242,095

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

 

Preferred stock, $0.01 par value; 100,000 shares authorized (including 140 shares of 12.5% Series A cumulative non-voting preferred stock), zero shares issued and outstanding

 

 

-

 

 

 

-

 

Common stock, $0.01 par value; 500,000,000 shares authorized, 16,146,546 shares issued and outstanding

 

 

160

 

 

 

160

 

Additional paid-in-capital

 

 

89,938

 

 

 

89,483

 

Accumulated deficit

 

 

(95,507

)

 

 

(86,899

)

Total stockholders' equity

 

 

(5,409

)

 

 

2,744

 

 

 

 

 

 

 

 

 

 

Non-controlling interests

 

 

(8,821

)

 

 

4,491

 

TOTAL EQUITY (DEFICIT)

 

 

(14,230

)

 

 

7,235

 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND EQUITY (DEFICIT)

 

$

1,286,965

 

 

$

1,249,330

 

 

Clipper Realty Inc.

Consolidated Statements of Operations

(In thousands, except per share data)

   

 

Three Months Ended December 31,

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

 

 

(unaudited)

 

 

(unaudited)

 

 

 

 

 

 

 

 

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential rental income

 

$

28,173

 

 

$

25,235

 

 

$

109,873

 

 

$

99,716

 

Commercial rental income

 

 

9,874

 

 

 

9,632

 

 

 

38,902

 

 

 

38,489

 

TOTAL REVENUES

 

 

38,047

 

 

 

34,867

 

 

 

148,775

 

 

 

138,205

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property operating expenses

 

 

8,065

 

 

 

7,808

 

 

 

34,163

 

 

 

30,619

 

Real estate taxes and insurance

 

 

7,633

 

 

 

7,341

 

 

 

29,770

 

 

 

31,951

 

General and administrative

 

 

3,772

 

 

 

3,140

 

 

 

14,152

 

 

 

13,169

 

Transaction pursuit costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

357

 

Depreciation and amortization

 

 

7,603

 

 

 

7,563

 

 

 

29,892

 

 

 

28,939

 

TOTAL OPERATING EXPENSES

 

 

27,073

 

 

 

25,852

 

 

 

107,977

 

 

 

105,035

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Litigation settlement and other

 

 

(269

)

 

 

-

 

 

 

(269

)

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INCOME FROM OPERATIONS

 

 

10,705

 

 

 

9,015

 

 

 

40,529

 

 

 

33,170

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

(11,791

)

 

 

(11,871

)

 

 

(47,111

)

 

 

(44,867

)

Loss on extinguishment of debt

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(3,868

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

(1,086

)

 

 

(2,856

)

 

 

(6,582

)

 

 

(15,565

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss attributable to non-controlling interests

 

 

668

 

 

 

1,773

 

 

 

4,082

 

 

 

9,665

 

Net loss attributable to common stockholders

 

$

(418

)

 

$

(1,083

)

 

$

(2,500

)

 

$

(5,900

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted net loss per share

 

$

(0.05

)

 

$

(0.09

)

 

$

(0.25

)

 

$

(0.45

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares / OP units

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding

 

 

16,089

 

 

 

16,063

 

 

 

16,120

 

 

 

16,063

 

OP units outstanding

 

 

26,317

 

 

 

26,317

 

 

 

26,317

 

 

 

26,317

 

Diluted shares outstanding

 

 

42,406

 

 

 

42,380

 

 

 

42,437

 

 

 

42,380

 

 

Clipper Realty Inc.

Consolidated Statements of Cash Flows

(In thousands)

   

 

Year Ended December 31,

 

.

 

2024

 

 

2023

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

 

 

Net loss

 

$

(6,582

)

 

$

(15,565

)

 

 

 

 

 

 

 

 

 

Adjustments to reconcile net loss to net cash provided by operating activities:

 

 

 

 

 

Depreciation

 

 

29,786

 

 

 

28,825

 

Amortization of deferred financing costs

 

 

2,122

 

 

 

1,705

 

Amortization of deferred costs and intangible assets

 

 

587

 

 

 

595

 

Amortization of above- and below-market leases

 

 

-

 

 

 

(18

)

Loss on extinguishment of debt

 

 

-

 

 

 

3,868

 

Deferred rent

 

 

251

 

 

 

214

 

Stock-based compensation

 

 

2,701

 

 

 

3,015

 

Bad debt expense

 

 

30

 

 

 

(87

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Tenant and other receivables

 

 

(1,215

)

 

 

(86

)

Prepaid expenses, other assets and deferred costs

 

 

4,483

 

 

 

2,701

 

Accounts payable and accrued liabilities

 

 

(948

)

 

 

(707

)

Security deposits

 

 

302

 

 

 

825

 

Other liabilities

 

 

345

 

 

 

900

 

Net cash provided by operating activities

 

 

31,862

 

 

 

26,185

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

 

 

 

Additions to land, buildings and improvements

 

 

(68,781

)

 

 

(41,357

)

Net cash used in investing activities

 

 

(68,781

)

 

 

(41,357

)

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

Payments of mortgage notes

 

 

(2,000

)

 

 

(84,728

)

Proceeds from mortgage notes

 

 

58,330

 

 

 

132,519

 

Dividends and distributions

 

 

(17,584

)

 

 

(17,394

)

Loan issuance and extinguishment costs

 

 

-

 

 

 

(9,666

)

Net cash provided by financing activities

 

 

38,746

 

 

 

20,731

 

 

 

 

 

 

 

 

 

 

Net increase in cash and cash equivalents and restricted cash

 

 

1,827

 

 

 

5,559

 

Cash and cash equivalents and restricted cash - beginning of period

 

 

36,225

 

 

 

30,666

 

Cash and cash equivalents and restricted cash - end of period

 

$

38,052

 

 

$

36,225

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents and restricted cash - beginning of period:

 

 

 

 

 

Cash and cash equivalents

 

$

22,163

 

 

$

18,152

 

Restricted cash

 

 

14,062

 

 

 

12,514

 

Total cash and cash equivalents and restricted cash - beginning of period

 

$

36,225

 

 

$

30,666

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents and restricted cash - end of period:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

19,896

 

 

$

22,163

 

Restricted cash

 

 

18,156

 

 

 

14,062

 

Total cash and cash equivalents and restricted cash - end of period

 

$

38,052

 

 

$

36,225

 

 

 

 

 

 

 

 

 

 

Supplemental cash flow information:

 

 

 

 

 

 

 

 

Cash paid for interest, net of capitalized interest of $9,417 and $5,508 in 2024 and 2023, respectively

 

$

43,995

 

 

$

45,323

 

Non-cash interest capitalized to real estate under development

 

 

2,264

 

 

 

339

 

Additions to investment in real estate included in accounts payable and accrued liabilities

 

 

8,169

 

 

 

9,484

 

 

Clipper Realty Inc.

Reconciliation of Non-GAAP Measures

(In thousands, except per share data)

(Unaudited)

Non-GAAP Financial Measures

We disclose and discuss funds from operations (“FFO”), adjusted funds from operations (“AFFO”), adjusted earnings before interest, income taxes, depreciation and amortization (“Adjusted EBITDA”) and net operating income (“NOI”), all of which meet the definition of “non-GAAP financial measures” set forth in Item 10(e) of Regulation S-K promulgated by the SEC.

While management and the investment community in general believe that presentation of these measures provides useful information to investors, neither FFO, AFFO, Adjusted EBITDA, nor NOI should be considered as an alternative to net income (loss) or income from operations as an indication of our performance. We believe that to understand our performance further, FFO, AFFO, Adjusted EBITDA, and NOI should be compared with our reported net income (loss) or income from operations and considered in addition to cash flows computed in accordance with GAAP, as presented in our consolidated financial statements.

Funds From Operations and Adjusted Funds From Operations

FFO is defined by the National Association of Real Estate Investment Trusts (“NAREIT”) as net income (computed in accordance with GAAP), excluding gains (or losses) from sales of property and impairment adjustments, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Our calculation of FFO is consistent with FFO as defined by NAREIT.

AFFO is defined by us as FFO excluding amortization of identifiable intangibles incurred in property acquisitions, straight-line rent adjustments to revenue from long-term leases, amortization costs incurred in originating debt, interest rate cap mark-to-market adjustments, amortization of non-cash equity compensation, acquisition and other costs, transaction pursuit costs, loss on modification/extinguishment of debt, gain on involuntary conversion, gain on termination of lease and non-recurring litigation-related expenses, less recurring capital spending.

Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. In fact, real estate values have historically risen or fallen with market conditions. FFO is intended to be a standard supplemental measure of operating performance that excludes historical cost depreciation and valuation adjustments from net income. We consider FFO useful in evaluating potential property acquisitions and measuring operating performance. We further consider AFFO useful in determining funds available for payment of distributions. Neither FFO nor AFFO represent net income or cash flows from operations computed in accordance with GAAP. You should not consider FFO and AFFO to be alternatives to net income (loss) as reliable measures of our operating performance; nor should you consider FFO and AFFO to be alternatives to cash flows from operating, investing or financing activities (computed in accordance with GAAP) as measures of liquidity.

Neither FFO nor AFFO measure whether cash flow is sufficient to fund all of our cash needs, including loan principal amortization, capital improvements and distributions to stockholders. FFO and AFFO do not represent cash flows from operating, investing or financing activities computed in accordance with GAAP. Further, FFO and AFFO as disclosed by other REITs might not be comparable to our calculations of FFO and AFFO.

The following table sets forth a reconciliation of FFO and AFFO for the periods presented to net loss, computed in accordance with GAAP (amounts in thousands):

 

 

Three Months Ended December 31,

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

FFO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(1,086

)

 

$

(2,856

)

 

$

(6,582

)

 

$

(15,565

)

Real estate depreciation and amortization

 

 

7,603

 

 

 

7,563

 

 

 

29,892

 

 

 

28,939

 

FFO

 

$

6,517

 

 

$

4,707

 

 

$

23,310

 

 

$

13,374

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AFFO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO

 

$

6,517

 

 

$

4,707

 

 

$

23,310

 

 

$

13,374

 

Amortization of real estate tax intangible

 

 

120

 

 

 

120

 

 

 

481

 

 

 

481

 

Amortization of above- and below-market leases

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(18

)

Straight-line rent adjustments

 

 

84

 

 

 

148

 

 

 

251

 

 

 

214

 

Amortization of debt origination costs

 

 

532

 

 

 

607

 

 

 

2,122

 

 

 

1,705

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of LTIP awards

 

 

714

 

 

 

801

 

 

 

2,701

 

 

 

3,015

 

Transaction pursuit costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

357

 

Loss on extinguishment of debt

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,868

 

Litigation settlement and other

 

 

269

 

 

 

-

 

 

 

269

 

 

 

-

 

Certain litigation-related expenses

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(10

)

Recurring capital spending

 

 

(140

)

 

 

(61

)

 

 

(324

)

 

 

(436

)

AFFO

 

$

8,097

 

 

$

6,322

 

 

$

28,810

 

 

$

22,550

 

AFFO Per Share/Unit

 

$

0.19

 

 

$

0.15

 

 

$

0.68

 

 

$

0.53

 

 

Adjusted Earnings Before Interest, Income Taxes, Depreciation and Amortization

We believe that Adjusted EBITDA is a useful measure of our operating performance. We define Adjusted EBITDA as net income (loss) before allocation to non-controlling interests, plus real estate depreciation and amortization, amortization of identifiable intangibles, straight-line rent adjustments to revenue from long-term leases, amortization of non-cash equity compensation, interest expense (net), acquisition and other costs, transaction pursuit costs, loss on modification/extinguishment of debt and non-recurring litigation-related expenses, less gain on involuntary conversion and gain on termination of lease.

We believe that this measure provides an operating perspective not immediately apparent from GAAP income from operations or net income (loss). We consider Adjusted EBITDA to be a meaningful financial measure of our core operating performance.

However, Adjusted EBITDA should only be used as an alternative measure of our financial performance. Further, other REITs may use different methodologies for calculating Adjusted EBITDA, and accordingly, our Adjusted EBITDA may not be comparable to that of other REITs.

The following table sets forth a reconciliation of Adjusted EBITDA for the periods presented to net loss, computed in accordance with GAAP (amounts in thousands):

 

 

Three Months Ended December 31,

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

Adjusted EBITDA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(1,086

)

 

$

(2,856

)

 

$

(6,582

)

 

$

(15,565

)

Real estate depreciation and amortization

 

 

7,604

 

 

 

7,563

 

 

 

29,892

 

 

 

28,939

 

Amortization of real estate tax intangible

 

 

121

 

 

 

120

 

 

 

481

 

 

 

481

 

Amortization of above- and below-market leases

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(18

)

Straight-line rent adjustments

 

 

84

 

 

 

148

 

 

 

251

 

 

 

214

 

Amortization of LTIP awards

 

 

714

 

 

 

801

 

 

 

2,701

 

 

 

3,015

 

Interest expense, net

 

 

11,791

 

 

 

11,871

 

 

 

47,111

 

 

 

44,867

 

Transaction pursuit costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

357

 

Loss on extinguishment of debt

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,868

 

Litigation settlement and other

 

 

269

 

 

 

-

 

 

 

269

 

 

 

-

 

Certain litigation-related expenses

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(10

)

Adjusted EBITDA

 

$

19,497

 

 

$

17,647

 

 

$

74,123

 

 

$

66,148

 

 

Net Operating Income

We believe that NOI is a useful measure of our operating performance. We define NOI as income from operations plus real estate depreciation and amortization, general and administrative expenses, acquisition and other costs, transaction pursuit costs, amortization of identifiable intangibles and straight-line rent adjustments to revenue from long-term leases, less gain on termination of lease. We believe that this measure is widely recognized and provides an operating perspective not immediately apparent from GAAP income from operations or net income (loss). We use NOI to evaluate our performance because NOI allows us to evaluate the operating performance of our company by measuring the core operations of property performance and capturing trends in rental housing and property operating expenses. NOI is also a widely used metric in valuation of properties.

However, NOI should only be used as an alternative measure of our financial performance. Further, other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to that of other REITs.

The following table sets forth a reconciliation of NOI for the periods presented to income from operations, computed in accordance with GAAP (amounts in thousands):

 

 

Three Months Ended December 31,

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

NOI

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

$

10,705

 

 

$

9,015

 

 

$

40,529

 

 

$

33,170

 

Real estate depreciation and amortization

 

 

7,603

 

 

 

7,563

 

 

 

29,892

 

 

 

28,939

 

General and administrative expenses

 

 

3,772

 

 

 

3,140

 

 

 

14,152

 

 

 

13,169

 

Amortization of real estate tax intangible

 

 

120

 

 

 

120

 

 

 

481

 

 

 

481

 

Amortization of above- and below-market leases

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(18

)

Litigation settlement and other

 

 

269

 

 

 

-

 

 

 

269

 

 

 

-

 

Straight-line rent adjustments

 

 

84

 

 

 

148

 

 

 

251

 

 

 

214

 

NOI

 

$

22,553

 

 

$

19,986

 

 

$

85,574

 

 

$

76,312

 

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20250214006369/en/

Lawrence Kreider Chief Financial Officer (718) 438-2804 x2231 larry@clipperrealty.com