Clipper Realty (NYSE:CLPR) reported continued strength in its residential portfolio during the second quarter of 2026, with stabilized residential properties 99% leased overall and new free-market leases exceeding prior rents by more than 13% across the portfolio.
However, the company’s quarterly financial results were affected by the August 2025 departure of New York City from its office space at 250 Livingston Street. Revenue declined modestly year over year, while net loss and adjusted funds from operations, or AFFO, reflected the impact of the terminated lease.
Residential rents and occupancy remain strong
Chief Financial Officer Larry Kreider said residential new rental rates in the second quarter were 13% above prior rents, while renewal rates were 6% higher. He attributed the environment to constrained housing supply and discouraged new development in New York City.
- Tribeca House was 99% occupied, with average rent of $92 per square foot and new rents of $97 per square foot.
- Clover House was 98% occupied, with average overall rents of $92 per square foot and new lease rates of $95 per square foot.
- Pacific House was 99% occupied, with free-market rents on new leases of $78 per square foot.
- Aspen maintained occupancy above 98%, while new rents were 11% higher than previous leases.
Rent collections also remained solid. Kreider said the overall collection rate for residential properties was approximately 96% during the second quarter.
Prospect House completes leasing
Management said it completed leasing at Prospect House, the company’s ground-up residential development at 953 Dean Street in Brooklyn. Bistricer said the property was brought online in August, on time and on budget, and had reached full occupancy during the final phase of its initial lease-up.
The nine-story development includes 240 units and approximately 162,000 residential square feet, with 70% of units designated free market and 30% affordable. The property also includes 31 parking spaces and 19,000 square feet of commercial space. Free-market units were leased at rents of $78 per square foot, according to the company.
Prospect House contributed $2.3 million in revenue during the quarter but recorded a net loss of $1.4 million and negative AFFO of $0.2 million while completing its lease-up, Corporate Controller Lawrence Sava said.
250 Livingston Street weighs on results
The company’s results continued to be affected by the former New York City tenancy at 250 Livingston Street. New York City vacated the office property in mid-August 2025. Clipper Realty subsequently notified the lender that it would no longer support operations at the property.
Sava said the lender has funded expenses and placed rents in escrow since the lease termination. On June 4, Clipper Realty entered into a consent and cooperation agreement with the lender to market and sell the loan on the property. The agreement permits Clipper Realty to bid, while the property is in receivership.
Bistricer said the lender was actively marketing the loan and funding all expenses, and the company was awaiting the results of the lender’s auction.
At 141 Livingston Street, the company continues to operate a property occupied by the New York City Brooklyn Courthouse. Kreider said the courthouse is leasing the space pending finalization of a previously agreed five-year lease expected to become effective in 2027, although he noted there could be no assurance of completion.
Quarterly financial results and dividend
Second-quarter revenue was $38.6 million, compared with $39 million in the year-earlier period. Sava said the $0.4 million decline primarily reflected the loss of $4.1 million in revenue from the New York City lease at 250 Livingston Street and the prior-year sale of the 10 West 65th Street property, which generated $0.7 million of second-quarter 2025 revenue.
Those declines were partly offset by Prospect House revenue and a $2.1 million increase across other properties, driven by higher residential rents, occupancy and new commercial leases at Tribeca House.
Clipper Realty recorded a net loss of $6.3 million, or $0.19 per share, compared with a net loss of $1.4 million, or $0.07 per share, a year earlier. The company said the increase in net loss primarily reflected a $5.7 million impact from the terminated New York City lease at 250 Livingston Street, substantially all of which was non-cash.
AFFO was $3.8 million, or $0.09 per share, compared with $8.3 million, or $0.20 per share, in the prior-year quarter. The company cited a $5.8 million impact from 250 Livingston Street, also substantially non-cash, as the primary driver of the decline.
As of quarter-end, Clipper Realty had $37.7 million of unrestricted cash and $24.9 million of restricted cash. Its operating debt was 88% fixed-rate, with an average interest rate of 3.87% and an average duration of 3.2 years, Sava said.
The company declared a quarterly dividend of $0.095 per share, unchanged from the prior quarter. The dividend is payable Aug. 26, 2026, to shareholders of record as of Aug. 18, 2026.
About Clipper Realty (NYSE:CLPR)
Clipper Realty Inc is a publicly traded real estate investment trust that acquires, owns and manages multifamily residential and mixed‐use properties in the Greater New York metropolitan area. Since its initial public offering in early 2017, the company has focused on strategically sourcing apartment buildings and retail space in Manhattan and Brooklyn, with an emphasis on value‐add opportunities that can benefit from in‐house leasing, renovation and operational efficiencies.
The company’s primary activities include property acquisition, selective repositioning and asset management.
