Clipper Realty Inc.

Welcome to the Clipper Realty Q4 earnings call. At this time, all participants have been placed on a listen-only mode, and the floor will be open for questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Lawrence Sava, Corporate Controller. Sir, the floor is yours.

Good afternoon, and thank you for joining us for the fourth quarter 2025 Clipper Realty, Inc. earnings conference call. Participating with me on today's call are David Bichester, Co-Chairman of the Board and Chief Executive Officer, JJ Bichester, Chief Operating Officer, and Larry Kreider, Chief Financial Officer. Please be aware that statements made during the call that are not historical may be deemed forward-looking statements and actual results may differ materially from those indicated by such forward-looking statements. These statements are subject to numerous risks and uncertainties. including those disclosed in the company's 2025 Annual Report in Form 10-K, just filed today, which is accessible at www.scc.gov and our website. As a reminder, the forward-looking statements speak only as the date of this call, February 26, 2026, and the company undertakes no duty to update them. During this call, management may refer to certain non-GAAP financial measures, including adjusted funds from operations, or AFFO, adjusted earnings for interest, taxes, depreciation, amortization, or adjusted EBITDA, and net operating income, or NOI. Please see our press release, Supplemental Financial Information, in Form 10-K, posted today for a reconciliation of these non-GAAP financial measures with the most directly comparable GAAP financial measures. With that, I will turn the call over to our co-chairman and CEO, David Bichester.

Thank you, Lawrence. Good afternoon. Welcome to the fourth quarter of 2025 earnings call for Clifton Realty. I will provide an update of our business performance and some developments after which JJ will discuss property level activity, including leasing performance, and Larry will speak to our quarterly financial performance. We will then take your questions. I am pleased to report that our residential properties continue to perform very well. due to continued high residential rental demand, generating excellent cash flow. Overall rents are generally at all-time highs and continuing to increase, and we are nearly fully leased. In the fourth quarter, new leases exceeded prior rents by nearly 13%, generally consistent with last quarter across the entire portfolio, as JJ will detail. We are also in the second quarter of initial lease-up at a prospect house development at 953 Dean Street. We bought the property online in August on time and on budget and replaced the bridge on the last quarter and it will provide funds through stabilization. We are presently approximately 78% leased with free market rent and about $85,000 a foot. This project was the ground up development in Brooklyn where we bought the land in 2021 and 22 and built a nine-story fully amenitized residential building with 160,000 residential rentable square feet, 240 units, 70 are free market and 30% are affordable, 57 parking spaces, and 19,000 commercial rental square feet. As to the office properties, we have settled the lender claims at 141 Livingston Street and obtained lender approval for a five-year lease extension with the principal tenant, New York City, all as previously announced. At 250 Livingston Street, where New York City vacated mid-August, as previously disclosed, we notified Orlando we did not intend to support the property's ongoing operation, and subsequent to the New York City lease, determination ceased making payments of interest in real estate taxes and applied for reimbursement of expenses recurrent since then. Furthermore, we may not fund these expenses at the conclusion of the discussions. We have begun to restructure the property debt, although we cannot assure us that this will be the case. I will now turn over the call to judges to provide an update on operations.