EX-99.1 2 ex_827653.htm EXHIBIT 99.1 ex_827653.htm

 

Exhibit 99.1

 

UNAUDITED PRO FORMA FINANCIAL INFORMATION

 

The following unaudited pro forma consolidated balance sheet as of March 31, 2025 and the unaudited pro forma consolidated statements of operations for the three months ended March 31, 2025 and year ended December 31, 2025 have been derived from the historical consolidated financial statements of the Company, as adjusted to give effect to the completion of the sale on May 30, 2025 (the “Sale”) of the Company’s property at 10 West 65th Street, New York City (the “Property”), and are intended to reflect the impact of the Sale on the Company’s results on a pro forma basis as of and for the periods indicated.

 

The unaudited pro forma consolidated financial statements of the Company and its subsidiaries have been prepared using assumptions and estimates that the Company’s management believes are reasonable under the circumstances and are intended for informational purposes only. They are not necessarily indicative of the financial results that would have occurred if the transactions described herein had taken place on the dates indicated, nor are they indicative of the future consolidated results of the Company. However, management believes that the estimates and assumptions used provide a reasonable basis for presenting the significant effects of the Sale of the Property. Management also believes the pro forma adjustments give appropriate effect to the estimates and assumptions and are applied in conformity with accounting principles generally accepted in the United States of America.

 

 

The unaudited pro forma financial information should be read in conjunction with the historical consolidated financial statements and accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations of the Company for the three months ended March 31, 2025 (unaudited) and for the year ended December 31, 2024 (audited), including the related notes, filed with the Securities and Exchange Commission.

 

The unaudited pro forma consolidated balance sheet as of March 31, 2025, has been prepared in accordance with the Securities and Exchange Commission’s pro forma rules under Regulation S-X Article 11 assuming the Sale of the Property occurred as of that date. The unaudited pro forma consolidated statements of operations for the three months ended March 31, 2025, and year ended December 31, 2024, have been prepared assuming that the Sale of the Property occurred as of January 1 of each period presented. All material adjustments required to reflect the Sale are set forth in the columns labeled “Pro Forma Adjustments”. The data contained in the columns labeled “As Reported” is derived from the Company’s historical unaudited consolidated balance sheet as of March 31, 2025, and the Company’s historical unaudited consolidated statement of operations for the three months ended March 31, 2025, and the audited consolidated statement of operations for the year ended December 31, 2024.

 

 
 

 

Clipper Realty Inc. 

Consolidated Balance Sheets 

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

 

   

Balance Sheets As of March 31, 2025 (unaudited)

 
   

As Reported

    

Pro Forma

Adjustments

      

As Adjusted

  
   

(unaudited)

    

(unaudited)

            

ASSETS

                          

Investment in real estate

                          

Land and improvements

   $ 508,311     $ -       $ 508,311  

Building and improvements

     718,748       -         718,748  

Tenant improvements

     3,348       -         3,348  

Furniture, fixtures and equipment

     13,439       -         13,439  

Real estate under development

     153,799       -         153,799  

Total investment in real estate

     1,397,645       -         1,397,645  

Accumulated depreciation

     (243,362 )     -         (243,362 )

Investment in real estate, net

     1,154,283       -         1,154,283  
                           

Cash and cash equivalents

     21,288       44,839  

(a)

     35,097  
              (31,030 )

(b)

        

Restricted cash

     17,823                 17,823  

Tenant and other receivables, net of allowance for doubtful accounts of $246

                       -  

Deferred rent

     2,086                 2,086  

Deferred costs and intangible assets, net

     5,560                 5,560  

Prepaid expenses and other assets

     8,166                 8,166  

Assets held for sale

     45,903       (45,903 )

(c )

     -  

TOTAL ASSETS

   $ 1,262,083     $ (31,997 )     $ 1,230,086  
                           

LIABILITIES AND EQUITY (DEFICIT)

                          

Liabilities:

                          

Notes payable, net of unamortized loan costs of $8,245

   $ 1,272,906     $ (31,030 )

(b)

   $ 1,241,876  

Accounts payable and accrued liabilities

     19,649       418  

(c )

     20,067  

Security deposits

     8,800                 8,800  

Other liabilities

     12,646                 12,646  

Liabilities held for sale

     886       (886 )

(c )

     -  

TOTAL LIABILITIES

   $ 1,314,887     $ (31,498 )     $ 1,283,389  

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

                       -  

Additional paid-in-capital

     90,152                 90,152  

Accumulated deficit

     (110,388 )     (499 )

(d)

     (110,887 )

Total stockholders' equity

     (20,076 )     (499 )       (20,575 )
                           

Non-controlling interests

     (32,728 )     -         (32,728 )

TOTAL EQUITY (DEFICIT)

   $ (52,804 )   $ (499 )     $ (53,303 )
                           

TOTAL LIABILITIES AND EQUITY (DEFICIT)

   $ 1,262,083     $ (31,997 )     $ 1,230,086  

 

(a) Represents pro forma cash received as if the Sale was completed on March 31, 2025. The Sale was completed on May 30, 2025 for a Sale price of $45,500 less closing costs of $1,864. In addition, as completed pro forma on March 31, 2025, the sale would have resulted in an additional $1,203 for assets and liabilities credited to or retained by the Company in cash. 

(b) Represents pro forma repayment of debt outstanding of the Property as if repaid March 31, 2025. 

(c ) Represents pro forma write-off of assets and pro forma retention of certain assets and liabilities of the Property as if the Sale was completed on March 31, 2025. 

(d) Represents pro forma loss on sale of property as if sold on March 31, 2025, reflecting contractual sale price of $45,500 less closing costs of $1,864 and basis of investment in real estate of $44,135. 

 

 
 

 

Clipper Realty Inc. 

Unaudited Pro Forma Consolidated Statements of Operations 

(In thousands, except per share data) 

 

   

Three Months Ended March 31, 2025

   

Year Ended December 31, 2024

 
   

As Reported

    

Pro Forma

Adjustments

(a)

    

As Adjusted

    

As Reported

    

Pro Forma

Adjustments

(a)

     As Adjusted  
   

(unaudited)

                                          

REVENUES

                                                

Residential rental income

   $ 29,190     $ (1,070 )   $ 28,120     $ 109,873     $ (4,040 )   $ 105,833  

Commercial rental income

     10,208       (3 )     10,205       38,902       (14 )     38,888  

TOTAL REVENUES

     39,398       (1,073 )     38,325       148,775       (4,054 )     144,721  
                                                 

OPERATING EXPENSES

                                                

Property operating expenses

     10,111       (200 )     9,911       34,163       (728 )     33,435  

Real estate taxes and insurance

     7,627       (278 )     7,349       29,770       (1,100 )     28,670  

General and administrative

     3,825       (118 )     3,707       14,152       (390 )     13,762  

Transaction pursuit costs

     -       -       -       -               -  

Depreciation and amortization

     7,636       (290 )     7,346       29,892       (1,170 )     28,722  

Impairment of Long-Lived Assets

     33,780       (33,780 )     -                          

TOTAL OPERATING EXPENSES

     62,979       (34,666 )     28,313       107,977       (3,388 )     104,589  
                                                 

Litigation settlement and other

     -       -       -       (269 )             (269 )
                                                 

INCOME FROM OPERATIONS

     (23,581 )     33,593       10,012       40,529       (666 )     39,863  
                                                 

Interest expense, net

     (11,522 )     558       (10,964 )     (47,111 )     2,542       (44,569 )
      -       -       -                          

Net (loss) income

     (35,103 )     34,151       (952 )     (6,582 )     1,876       (4,706 )
                                                 

Net (loss) income attributable to non-controlling interests

     21,756       (21,166 )     590       4,082       (1,163 )     2,919  
      -               -       -               -  

Net (loss) income attributable to common stockholders

   $ (13,347 )   $ 12,985     $ (362 )   $ (2,500 )   $ 713     $ (1,787 )
                                                 

Basic and diluted net (loss) income per share

   $ (0.86 )           $ (0.06 )   $ (0.25 )           $ (0.20 )
                                                 

Weighted average common shares / OP units

                                                

Common shares outstanding

     16,147               16,147       16,120               16,120  

OP units outstanding

     26,317               26,317       26,317               26,317  

Diluted shares outstanding

     42,464               42,464       42,437               42,437  

 

(a) Represents pro forma effects of completion of the Sale of the Property and repayment of debt of the Property as if completed at beginning of period.