Innovative Industrial (IIPR) Issues Q4 Update, Continues Buyouts


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Innovative Industrial Properties, Inc. IIPR is focused on the acquisition, ownership and management of specialized industrial properties leased to experienced, state-licensed operators for their regulated cannabis facilities. It is likely to keep gaining from its acquisitions and expansion efforts.
In the operating update released recently, management of Innovative Industrial Properties noted that since the beginning of the fourth quarter through Jan 5, it has made 29 acquisitions for properties in California, Colorado, Michigan, North Dakota and Pennsylvania.
Moreover, Innovative Industrial Properties has executed one lease amendment to provide an additional improvement allowance at a property in Massachusetts. With these deals, the company has not only established new tenant relationships with Gold Flora, LLC, Medicine Man Technologies, Inc. (Schwazze) and Southwest Alternative Care, LLC (Kaya Cannabis) but also expanded its existing ties with Columbia Care Inc., Curaleaf Holdings, Inc., LivWell Holdings, Inc. and Temescal Wellness of Massachusetts, LLC.
Innovative Industrial Properties’ expansion efforts in the fourth quarter resulted in the company owning 103 properties as of Jan 5, 2022. The properties aggregate 7.7 million rentable square feet, including 2.5 million rentable square feet under development/redevelopment.
As of Jan 5, 2022, Innovative Industrial Properties invested roughly $1.7 billion across its portfolio. Moreover, it committed an additional $316.1 million for the reimbursement of some tenants and sellers for the completion of construction and improvements at IIPR’s properties.
However, the company did not carry out capital raising activities during the abovementioned period. It has roughly $231.7 million in shares of common stock available for issuance under its “at-the-market” equity offering program.
The legalization of marijuana for medical use across several U.S states as well as for recreational use in several states has opened up opportunities for the cannabis industry. Therefore, with states signaling the green light for cannabis, Innovative Industrial Properties has incentives to partner with experienced medical-use cannabis operators and serve as a vital source of capital by acquiring and leasing back their real-estate assets. Its strategy is to acquire the existing, redeveloped and under-development industrial buildings, including enclosed greenhouse facilities.
Over the past six months, shares of this Zacks Rank #4 (Sell) company have outperformed the industry. The stock has rallied 12.4% compared with the industry’s growth of 9.1%.

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Stocks to Consider

Some better-ranked stocks from the REIT sector include Terreno Realty Corp. TRNO, CubeSmart CUBE and Rexford Industrial Realty REXR.
Terreno Realty holds a Zacks Rank of 2 (Buy) at present. Terreno Realty’s 2021 FFO per share is projected to increase 19.4% year over year.
Also, the Zacks Consensus Estimate for TRNO’s 2022 FFO per share has been revised marginally upward in the past two months.
The Zacks Consensus Estimate for CubeSmart’s 2021 FFO per share has moved 2.4% north to $2.10 over the past two months.
Currently, CubeSmart carries a Zacks Rank of 1. CUBE’s long-term growth rate is projected at 11.2%.
The Zacks Consensus Estimate for Rexford Industrial’s 2021 FFO per share has moved 1.2% north to $1.63 over the past two months.
Currently, Rexford Industrial carries a Zacks Rank of 2. REXR’s long-term growth rate is projected at 12.9%.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.

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Terreno Realty Corporation (TRNO): Free Stock Analysis Report
 
CubeSmart (CUBE): Free Stock Analysis Report
 
Rexford Industrial Realty, Inc. (REXR): Free Stock Analysis Report
 
Innovative Industrial Properties, Inc. (IIPR): Free Stock Analysis Report
 
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