SAN DIEGO–(BUSINESS WIRE)–Innovative Industrial Properties, Inc. (IIP), the primary and solely actual property firm on the New York Stock Exchange (NYSE: IIPR) targeted on the regulated U.S. hashish business, introduced as we speak that it’s extending its long-term actual property relationship with Kings Garden Inc. (Kings Garden), one of California’s high hashish producers, with the acquisition of a Southern California property, which includes roughly 192,000 sq. toes of industrial area.
The buy worth for the property was roughly $25.four million (excluding transaction prices). Concurrent with the closing of the acquisition, IIP entered right into a long-term, triple-net lease on the property with Kings Garden, which intends to function the property as a licensed hashish cultivation and distribution facility upon completion of redevelopment. Kings Garden is anticipated to finish extra tenant enhancements for the property, for which IIP has agreed to offer reimbursement of as much as $25.zero million. Including this property, IIP leases six properties to Kings Garden, representing roughly 364,000 sq. toes of industrial area and a complete dedication (together with buy costs and commitments to fund tenant enhancements, however excluding transaction prices) of roughly $95.zero million.
“Kings Garden is one of the preeminent operators in California, and has pioneered industry best practices to develop the highest quality and consistency in its cannabis products,” stated Paul Smithers, President and Chief Executive Officer of IIP. “We are thrilled to expand our long-term real estate partnership and support Kings Garden in significantly enhancing their capacity through redevelopment of this new facility to Kings Garden’s exacting environmental controls and specifications.”
As the pioneering actual property funding belief (REIT) for the medical-use hashish business, IIP companions with skilled medical-use hashish operators and serves as a supply of capital by buying and leasing again their actual property property, along with providing different artistic actual estate-based capital options.
“IIP has been a powerful partner for us, enabling us to expand operations in the largest cannabis market in the world,” stated Michael King, Chairman and CEO of Kings Garden. “Kings Garden prides itself on working with only the best and IIP is on a different level from all others, working collaboratively with us to facilitate a smooth transaction. Our partnership with IIP provides us with strategic, non-dilutive capital to continue to leverage our expertise as purveyors of world-class cannabis products, to further increase our reach to patients and customers throughout California. We expect this new facility to increase our production capacity by more than double, adding approximately 50,000 pounds of finished cannabis on an annual basis.”
According to BDS Analytics, by means of September 30, 2020, California generated over $2.6 billion in regulated hashish gross sales, which is anticipated to develop to just about $7.four billion by 2025. Also based on Marijuana Business Daily, whereas solely 168 of California’s 540 cities and counties permit for regulated hashish firms to function inside their borders as of June, dozens of metropolis and county initiatives had been permitted by voters this month, that are anticipated to additional enhance demand for regulated hashish merchandise all through the state.
As of November 16, 2020, IIP owned 64 properties situated in Arizona, California, Colorado, Florida, Illinois, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, North Dakota, Ohio, Pennsylvania and Virginia, totaling roughly 5.2 million rentable sq. toes (together with roughly 1.9 million rentable sq. toes below growth/redevelopment), which had been 99.3% leased (based mostly on sq. footage) with a weighted-average remaining lease time period of roughly 16.Three years. As of November 16, 2020, IIP had invested roughly $943.2 million within the mixture (excluding transaction prices) and had dedicated a further roughly $293.1 million to reimburse sure tenants and sellers for completion of development and tenant enhancements at IIP’s properties. These statistics don’t embody as much as roughly $3.2 million which may be funded sooner or later pursuant to IIP’s lease with a tenant at one of IIP’s Massachusetts properties, because the tenant at that property might not elect to have IIP disburse these funds to the tenant and pay IIP the corresponding base lease on these funds. These statistics additionally deal with IIP’s Los Angeles, California property as not leased, because of the tenant being in receivership and its ongoing default in its obligation to pay lease at that location.
About Innovative Industrial Properties
Innovative Industrial Properties, Inc. is a self-advised Maryland company targeted on the acquisition, possession and administration of specialised industrial properties leased to skilled, state-licensed operators for his or her regulated medical-use hashish services. Innovative Industrial Properties, Inc. has elected to be taxed as an actual property funding belief, commencing with the yr ended December 31, 2017. Additional data is out there at www.innovativeindustrialproperties.com.
About Kings Garden
Based in Coachella Valley, Kings Garden Inc. is California’s predominant hashish cultivation, processing and manufacturing firm, specializing on this planet of premium grade boutique merchandise at an unsurpassed industrial scale. Now one of the biggest producers in California, Kings Garden prides itself on having organized extremely skilled hashish administration and operations workforce, whereas being totally compliant and licensed throughout the state of California. From its inception, Kings Garden has held unwavering values targeted on superior high quality of finish merchandise, its workforce of administration and workers who’re thought of household, giving again to native communities, and the development of the hashish business as an entire. For extra data go to https://kingsgarden.com/ or https://www.instagram.com/kingsgarden.ca/.
Innovative Industrial Properties Forward-Looking Statements
This press launch accommodates statements that IIP believes to be “forward-looking statements” inside the that means of the protected harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements aside from historic info, together with, with out limitation, statements concerning the lease and redevelopment of the California property, Kings Garden and the California regulated hashish market, are forward-looking statements. When used on this press launch, phrases corresponding to we “expect,” “intend,” “plan,” “estimate,” “anticipate,” “believe” or “should” or the destructive thereof or related terminology are usually supposed to establish forward-looking statements. Such forward-looking statements are topic to dangers and uncertainties that would trigger precise outcomes to vary materially from these expressed in, or implied by, such statements. Investors shouldn’t place undue reliance upon forward-looking statements. IIP disclaims any obligation to replace or revise any forward-looking statements, whether or not in consequence of new data, future occasions or in any other case.