IIPR stock is soaring today after Innovative Industrial Properties Inc (NYSE:IIPR) announced that it had purchased 50,000 square feet of industrial space in Ohio to be leased to Cresco Labs Inc (CSE:CL) (OTCQX:CRLBF), the third such deal that the two firms have entered into.
Strong Year For IIPR Stock
Innovative is a cannabis real estate investment trust (REIT) founded in 2016, which is the first of its kind to list on the New York Stock Exchange. The company’s entire business model is built upon purchasing property from cannabis firms and then leasing them back out on long-term contracts, essentially making it one big landlord for the cannabis industry. Following a year where many cannabis firms spent heavily on building new facilities only for revenues to fall short, leaving many cash strapped, IIPR stock was one of the big gainers in 2019 as a result.
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Continued Cresco Partnership
The San Diego-based firm has now announced that it has purchased around 50,000 square feet of industrial space in Ohio for US$10.6 million in total. Concurrent with the closing of that deal, IIPR has also entered into a long-term lease with cannabis firm Cresco Labs, which intends to continue to operate the property as a cannabis cultivation and processing facility. Cresco expects to complete additional tenant improvements on the property, for which Innovative Industrial Properties is providing reimbursement of up to $1.9 million. IIPR stock is up 8.5% as a result.
The deal represents the third acquisition and lease with Cresco, with the two other facilities located in Illinois. “Cresco continues to execute well on its business plan and has created a truly nationwide reach in its operations, benefiting patients and consumers across the United States, while creating jobs and contributing meaningfully to the local communities where they operate. We are thrilled to partner with them again,” said Innovative CEO and President Paul Smithers. IIPR stock is currently trading for $92.25.
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