IIP Expands Property Portfolio to 62 Properties
in 16 States Comprising Over 4.7 Million Square Feet
Innovative Industrial Properties, Inc. (IIP), the first and only
real estate company on the New York Stock Exchange (NYSE: IIPR)
focused on the regulated U.S. cannabis industry, announced today
that it closed on the acquisition of a property located at 29600
Stephenson Highway in Madison Heights, Michigan.
The purchase price for the property was $6.2 million (excluding
transaction costs). Concurrent with the closing of the purchase,
IIP entered into a long-term, triple-net lease agreement with a
subsidiary of Holistic Industries Inc. (“Holistic”), which intends
to operate the property as a regulated cannabis cultivation,
processing and dispensing facility, upon completion of development
of an approximately 63,000 square foot industrial building. In
connection with the development of the property, IIP has agreed to
provide reimbursement of up to $18.8 million. Assuming full
reimbursement for the development of the property, IIP’s total
investment in the property will be $25.0 million.
In addition to the Michigan property, IIP owns and leases to
Holistic three other properties in Maryland, Massachusetts and
Pennsylvania.
As the pioneering real estate investment trust (REIT) for the
medical-use cannabis industry, IIP partners with experienced
medical-use cannabis operators and serves as a source of capital by
acquiring and leasing back their real estate assets, in addition to
offering other creative real estate-based capital solutions.
“We have had the privilege of being Holistic’s long-term real
estate partner since 2017, and supporting them in their expansion
over the years with key growth capital along the way,” said Paul
Smithers, President and Chief Executive Officer of IIP. “Josh and
his team of dedicated professionals have set a standard for product
quality, patient care and customer experience that we are proud to
support, and we are thrilled for the success that they have
achieved.”
Holistic is one of the largest private, vertically-integrated
multi-state operators in the cannabis industry, with operations in
California, Maryland, Massachusetts, Michigan, Pennsylvania and
Washington D.C. Founded by Chief Executive Officer Josh Genderson
in 2011, Holistic’s success is driven by its unique and scalable
approach and mission to be the best place to work, shop and invest
in the cannabis industry. Holistic is dedicated to delivering
exceptional cannabis products to patients and customers in an
environment of highly focused customer service and individualized
patient care.
“IIP has been an excellent real estate partner, and we
appreciate their unwaivering support in facilitating our expansion
over the past three-plus years,” said Josh Genderson, Chief
Executive Officer of Holistic. “We look forward to working closely
with IIP in the development of this property and the vision we have
for the community, creating a state-of-the-art facility that
produces the high quality, consistent product, with a
compassionate, customer-focused experience for our patients and
customers, and an operation that provides great jobs and
opportunities for career advancement for local residents.”
According to a Michigan Marijuana Regulatory Agency report, July
2020 total sales for medical-use and adult-use cannabis were
approximately $109.6 million, equating to approximately $1.3
billion in sales on an annualized basis and representing a
continued strong, month-to-month growth. Michigan began regulated
adult-use cannabis sales in December of last year. As of today,
IIP’s total investment, including committed funding for future
tenant improvements, for the properties IIP owns in Michigan is
approximately $155.8 million.
As of September 1, 2020, IIP owned 62 properties located in
Arizona, California, Colorado, Florida, Illinois, Maryland,
Massachusetts, Michigan, Minnesota, New Jersey, New York, Nevada,
North Dakota, Ohio, Pennsylvania and Virginia, totaling
approximately 4.7 million rentable square feet (including
approximately 1.7 million rentable square feet under
development/redevelopment), which were 99.3% leased (based on
square footage) with a weighted-average remaining lease term of
approximately 16.0 years. As of September 1, 2020, IIP had invested
approximately $844.8 million in the aggregate (excluding
transaction costs) and had committed an additional approximately
$245.9 million to reimburse certain tenants and sellers for
completion of construction and tenant improvements at IIP’s
properties. These statistics do not include up to approximately
$14.5 million that may be funded in the future pursuant to IIP’s
lease with a tenant at one of IIP’s Massachusetts properties, as
the tenant at that property may not elect to have IIP disburse
those funds to the tenant and pay IIP the corresponding base rent
on those funds. These statistics also treat IIP’s Los Angeles,
California property as not leased, due to the tenant being in
receivership and its ongoing default in its obligation to pay rent
at that location.
About Innovative Industrial Properties
Innovative Industrial Properties, Inc. is a self-advised
Maryland corporation focused on the acquisition, ownership and
management of specialized industrial properties leased to
experienced, state-licensed operators for their regulated
medical-use cannabis facilities. Innovative Industrial Properties,
Inc. has elected to be taxed as a real estate investment trust,
commencing with the year ended December 31, 2017. Additional
information is available at
www.innovativeindustrialproperties.com.
Innovative Industrial Properties
Forward-Looking Statements
This press release contains statements that IIP believes to be
“forward-looking statements” within the meaning of the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
All statements other than historical facts, including, without
limitation, statements regarding the acquisition and lease of the
Michigan property, Holistic and the Michigan regulated cannabis
market, are forward-looking statements. When used in this press
release, words such as we “expect,” “intend,” “plan,” “estimate,”
“anticipate,” “believe” or “should” or the negative thereof or
similar terminology are generally intended to identify
forward-looking statements. Such forward-looking statements are
subject to risks and uncertainties that could cause actual results
to differ materially from those expressed in, or implied by, such
statements. Investors should not place undue reliance upon
forward-looking statements. IIP disclaims any obligation to update
or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.
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version on businesswire.com: https://www.businesswire.com/news/home/20200901006097/en/
Company Contact: Catherine Hastings Chief Financial Officer,
Chief Accounting Officer and Treasurer Innovative Industrial
Properties, Inc. (858) 997-3332
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