Clipper Realty Reports 4.5% Revenue Growth but Faces Net Loss in Q2 2025

Clipper Realty Inc. reported its financial results for the second quarter of 2025, revealing total revenues of $39.036 million, a 4.5% increase from $37.346 million in the same period last year. The company's residential rental income rose to $29.054 million, up from $27.748 million, while commercial rental income increased to $9.982 million from $9.598 million. Despite the revenue growth, Clipper Realty experienced a net loss of $1.356 million for the quarter, an improvement from a net loss of $1.743 million in the prior year.

In the first half of 2025, Clipper Realty's total revenues reached $78.434 million, compared to $73.106 million in the first half of 2024, marking a 7.9% increase. However, the company reported a significant net loss of $36.459 million for the six months ended June 30, 2025, compared to a loss of $4.410 million in the same period of 2024. This substantial loss was primarily attributed to a $33.780 million impairment on long-lived assets related to the 10 West 65th Street property, which was sold in May 2025 for $45.5 million.

Operationally, Clipper Realty's properties maintained strong occupancy rates, with the Tribeca House achieving 100% occupancy and an average rental rate of $85.60 per square foot, up from $80.93 a year earlier. The Flatbush Gardens property also saw an increase in average rent per square foot to $31.27 from $28.10. However, the company faces challenges as the City of New York plans to vacate its lease at 250 Livingston Street by August 2025, which could result in a loss of approximately $16 million in annual rental income.

The company’s total assets decreased to $1.241 billion as of June 30, 2025, down from $1.287 billion at the end of 2024. Clipper Realty's liabilities remained relatively stable, totaling $1.299 billion, with notes payable slightly increasing to $1.268 billion. The company reported cash and cash equivalents of $32.029 million, up from $19.896 million at the end of 2024, bolstered by proceeds from the recent property sale.

Looking ahead, Clipper Realty's management expressed cautious optimism regarding its operational strategy, focusing on optimizing revenues and controlling costs. The company is actively seeking new tenants to replace the City of New York at 250 Livingston Street and is navigating ongoing negotiations related to its lease agreements. The outlook remains uncertain, particularly with the potential impact of market conditions and regulatory changes in New York City on occupancy levels and rental rates.