CLPR secures $84.5M loan at 5.73% to refinance Brooklyn property

Rhea-AI Filing Summary

Clipper Realty Inc. subsidiary 1010 Pacific Owner LLC refinanced the residential rental property at 1010 Pacific Street, Brooklyn, NY with a new $84.5M loan that matures on October 6, 2030 and carries an interest rate of 5.73% per annum. The new loan replaces two prior mortgage notes totaling $80.0M that matured on September 15, 2025; those notes had rates of 5.55% and 6.37%.

The company repaid approximately $80.4M in principal and accrued interest to the prior lender and incurred about $1.7M in closing costs and prepaid interest, plus roughly $0.2M placed in escrow for taxes, insurance, and rent reserves. At closing the refinancing produced net proceeds of approximately $2.1M. The loan includes customary representations, covenants, and default events and is secured by the Property.

Positive

• Extended maturity to October 6, 2030, reducing near-term refinancing risk
• Net proceeds of $2.1M received at closing, slightly improving liquidity
• Single consolidated loan of $84.5M simplifies capital structure secured by the Property

Negative

• Closing costs and prepaid interest of $1.7M reduced immediate cash benefit
• Escrow set‑aside of $0.2M for taxes, insurance and rent reserves ties up cash
• Interest rate of 5.73% is higher than one prior note (5.55%), raising blended cost versus that tranche

Insights

Real Estate Finance Analyst

Refinance extends maturity and modestly adjusts cost of debt.

The transaction replaces two short-maturity notes with a single $84.5M facility maturing on October 6, 2030, which provides longer-term financing and consolidated lender relationships. The new coupon of 5.73% sits between the prior rates of 5.55% and 6.37%, reflecting a blended financing cost that is comparable to prior debt.

Key dependencies include compliance with loan covenants and maintaining property cash flows to support reserves. Monitor performance over the next 12–18 months for any covenant pressure and use of the $0.2M escrow reserves.

Corporate Treasury / Credit Analyst

Transaction impacts liquidity and carries near-term closing costs.

Repayment of the prior facility required approximately $80.4M and generated $2.1M in net proceeds after roughly $1.7M in closing costs and prepaids plus $0.2M escrow. The refinancing preserves liquidity modestly while extending the debt term to 2030.

Risks include the added administrative and covenant obligations tied to new lenders; investors should watch quarterly reports for covenant metrics and any changes to cash reserves over the next four quarters.

8-K Event Classification

3 items: 1.01, 1.02, 2.03

3 items

Item 1.01 Entry into a Material Definitive Agreement Business

The company signed a significant contract such as a merger agreement, credit facility, or major partnership.

Item 1.02 Termination of a Material Definitive Agreement Business

A significant contract was terminated, which may affect business operations or revenue.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement Financial

The company incurred a new significant debt or off-balance-sheet obligation.

Understanding 8-K Material Events →

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):

October 1, 2025

CLIPPER REALTY INC.

(Exact Name of Registrant as Specified in Charter)

Maryland		001-38010		47-4579660
(State or Other		(Commission		(IRS Employer
Jurisdiction of		File Number)		Identification No.)
Incorporation)

4611 12th Avenue, Suite 1L Brooklyn, New York		11219
(Address of Principal Executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (718) 438-2804.

Former name or former address, if changed since last report: N/A

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2.):

	☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
	☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
	☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
	☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, par value $0.01 per share	CLPR	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company           ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01 Entry into a Material Definitive Agreement.

On October 1, 2025, 1010 Pacific Owner LLC, a Delaware limited liability company (“1010 Pacific”) and a subsidiary of Clipper Realty Inc. (the “Company”), entered into a Loan Agreement (the “Loan Agreement”) with Citi Real Estate Funding Inc., a New York corporation, and Morgan Stanley Bank, N.A., a national banking association, as the lenders, dated as of October 1, 2025.

The Loan Agreement provides for the $84.5 million loan to 1010 Pacific (the “Loan”). The Loan has a maturity date of October 6, 2030 and bears interest at a 5.73% rate per annum. The Loan is secured by the residential rental property located at 1010 Pacific Street, Brooklyn, New York (the “Property”).

The Loan Agreement also contains customary representations, covenants, and events of default.

Prior to entering into the Loan Agreement, 1010 Pacific had $80.0 million in mortgage debt secured by the Property, in the form of two mortgage notes issued to Valley National Bank N.A. (the “Bank”): (i) a $60.0 million note which had an annual interest rate of 5.55%, and (ii) a $20.0 million note with an annual interest rate of 6.37%; both notes matured on September 15, 2025, and 1010 Pacific had the option to prepay in full, or in part, the unpaid balance of the notes prior to the maturity date. On October 1, 2025, concurrently with entering into the Loan Agreement, 1010 Pacific repaid $80 million mortgage loan with the Bank and terminated its loan agreement with the Bank (the “Prior Loan Agreement”). In connection with this refinancing, 1010 Pacific paid to the Bank approximately $80.4 million of principal and accrued interest outstanding under the Prior Loan Agreement.

The Company incurred no fees or costs as a result of the termination of the Prior Loan Agreement, the Company incurred approximately $1.7 million in closing costs and prepaid interest and set aside approximately $0.2 million is escrow accounts for property taxes, property insurance and rent reserves under the Loan Agreement. The Company received net proceeds of approximately $2.1 million from this refinancing at the time of closing.

The foregoing description of the Loan Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Loan Agreement, which will be filed as an exhibit to the Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 to be filed with the Securities and Exchange Commission. 

Item 1.02 Termination of a Material Definitive Agreement.

The information set forth under Item 1.01 above is incorporated into this Item 1.02 by reference.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth under Item 1.01 above is incorporated into this Item 2.03 by reference.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Clipper Realty Inc.
	(Registrant)
	By:	/s/ David Bistricer
	Name:	David Bistricer
	Title:	Co-Chairman and Chief Executive Officer

Date: October 6, 2025

FAQ

What loan did Clipper Realty (CLPR) secure for 1010 Pacific?

A new $84.5M loan secured by the property at 1010 Pacific Street, Brooklyn, with maturity on October 6, 2030 and interest at 5.73%.

How much did CLPR repay to the prior lender in the refinancing?

The company repaid approximately $80.4M in principal and accrued interest to terminate the prior mortgage loan.

What were the total transaction costs and escrow amounts?

Clipper incurred about $1.7M in closing costs and prepaid interest and set aside roughly $0.2M in escrow for property taxes, insurance, and rent reserves.

Did the refinancing generate any proceeds?

Yes, the refinancing produced net proceeds of approximately $2.1M at closing.

What were the interest rates on the prior notes?

The prior mortgage notes had annual interest rates of 5.55% and 6.37%, and both matured on September 15, 2025.

Who are the lenders on the new loan?

The lenders are Citi Real Estate Funding Inc. and Morgan Stanley Bank, N.A..