Ohio Property Secures Expansion of Agreement Between Green Thumb Industries and Innovative Industrial Properties.
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 entered into an amendment of the lease with a subsidiary of Green Thumb Industries Inc. (CSE: GTII) in Toledo, Ohio, making available an additional $25.0 million in funding for the construction of a cannabis cultivation facility, which is in addition to the existing medical cannabis processing facility on the property. The lease amendment also adjusted the base rent under the lease to take into account the additional available funding and extended the term of the lease agreement. Assuming full payment of the additional funding, IIP's total investment in the property will be $32.2 million.
In addition to this facility in Toledo, Ohio, IIP owns and leases to Green Thumb's regulated cannabis cultivation and processing facilities in Oglesby, Illinois and Danville, Pennsylvania. Assuming full reimbursement of tenant improvements under the leases, IIP's total investment in properties leased to Green Thumb is expected to be $121.8 million.
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.
Green Thumb is a leading national cannabis consumer packaged goods company and owner of Rise™ and Essence retail stores. Green Thumb has 13 manufacturing facilities, licenses for 96 retail locations and operations across twelve U.S. markets. In addition to the Toledo facility, which commenced production and distribution of Green Thumb's brand portfolio in early July, Green Thumb currently operates five licensed dispensaries in Ohio.
We are proud to be Green Thumb's long-term real estate partner.Paul Smithers, President and CEO of IIP
"Green Thumb is a best-in-class operator with a dedication to providing the highest quality cannabis products to its patients and customers, while being an impactful contributor to the communities where it operates," said Paul Smithers, President and Chief Executive Officer of IIP. "We are proud to support them with the real estate capital in this next phase of development of their presence in Ohio to effectively serve the demand of medical cannabis patients throughout the state."
"We appreciate the continued strong support of IIP as a long-term real estate capital partner," said Green Thumb Founder and CEO Ben Kovler. "The Ohio regulated cannabis industry continues to represent a tremendous growth opportunity, and we look forward to bringing our high quality Rythm flower to the patients in the state."
Medical-use cannabis dispensaries in Ohio made their first sales in 2019. According to the Ohio Board of Pharmacy, since inception and through August 2020, more than 130,000 patients and 14,000 caregivers have registered for the state's medical cannabis program, generating over $175 million in product sales.
As of October 1, 2020, IIP owned 63 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 5.0 million rentable square feet (including approximately 1.9 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 16.2 years. As of October 1, 2020, IIP had invested approximately $884.5 million in the aggregate (excluding transaction costs) and had committed an additional approximately $292.0 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 $10.0 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.
To learn more about Green Thumb Industries, visit their company HQ here.
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