SAN DIEGO--(BUSINESS WIRE)--
Innovative Industrial Properties, Inc. (the “Company”) (NYSE: IIPR)
announced today that it plans to close its previously-announced
sale-leaseback transaction with PharmaCann LLC (“PharmaCann”) in
December 2016. In the sale-leaseback transaction, the Company will
acquire PharmaCann's state-of-the-art, newly-constructed 127,000 square
foot medical-use cannabis cultivation and processing facility in New
York.
"We are excited to have PharmaCann and its highly regarded management
team as our first tenant," said Alan D. Gold, Executive Chairman of the
Company. "PharmaCann's New York facility is truly a blueprint for an
institutional-grade medical-use cannabis cultivation and processing
facility. The PharmaCann team, as the holder of one of five licenses in
New York and multiple licenses in Illinois, is laser-focused on
developing the highest quality products to treat patients in those
states for a wide array of medical conditions, including chronic pain,
which New York health regulators recently added to its list of
qualifying medical conditions."
The Company previously entered into a purchase agreement with PharmaCann
to acquire PharmaCann’s New York facility for $30 million in a
sale-leaseback transaction. Upon the closing of the acquisition, the
Company is expected to lease the property back to PharmaCann for an
initial term of 15 years, with two five-year lease extension options.
The lease provides that the initial base rent will be approximately
$319,580 per month, subject to annual increases of the greater of 4% or
75% of the consumer price index. The lease also provides that the
Company will receive a property management fee equal to 1.5% of the
then-current base rent throughout the term, and supplemental base rent
for the first five years of the term at a rate of $105,477 per month.
Together, the expected annualized initial base rent, property management
fee and supplemental base rent equate to approximately 17.2% of the
purchase price of the New York facility.
Teddy Scott, Chief Executive Officer of PharmaCann, commented,
"Innovative Industrial Properties is the ideal partner for us for our
real estate needs. They have the real estate business acumen and
creative flexibility that we need as we continue to develop our business
in this dynamic and rapidly growing industry. We are thrilled to be
entering into this transaction with them and forging a long-term
relationship."
PharmaCann operates two medical-use cannabis cultivation and processing
facilities and four registered medical-use cannabis dispensaries in
Illinois, in addition to the cultivation and processing facility that is
the subject of this transaction and four registered medical-use cannabis
dispensaries in New York.
The transaction is subject to customary closing conditions, and the
Company cannot provide assurances that the Company will close on the
transaction on the terms described herein, or at all.
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 intends to elect to be taxed as a real
estate investment trust.
Forward-Looking Statements
This press release contains statements that we believe 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 consummation of the sale-leaseback transaction
with PharmaCann and the terms thereof, 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.
View source version on businesswire.com: http://www.businesswire.com/news/home/20161206005489/en/
Innovative Industrial Properties, Inc.
Paul Smithers
Chief
Executive Officer
(858) 997-3332
Source: Innovative Industrial Properties, Inc.