Innovative Industrial Properties acquires Illinois property and expands partnership with 4Front Ventures Corp.

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IIP expands portfolio to 73 properties totaling 6.8 million square feet in 18 states

SAN DIEGO, 3 August 2021– (BUSINESS WIRING) – Innovative Industrial Properties, Inc. (IIP), the first and only real estate company on the New York Stock Exchange (NYSE: IIPR) specializing in the regulated cannabis industry in the United States, has announced the completion of a deal to acquire a property in Illinois and has entered into a long-term lease with subsidiary 4Front Ventures Corp … (CSE: FFNT) (OTCQX: FFNTF) (4Front).

The purchase price of the property was $ 6.5 million (excluding transaction costs). 4Front is expected to build approximately 250,000 square feet of industrial space on the site for which IIP has agreed to provide up to $ 43.75 million in refunds. Subject to full recovery of construction costs, the IIP’s total investment in real estate is expected to be $ 50.25 million (excluding transaction costs). 4Front intends to manage the property upon completion of construction as a licensed cannabis growing and processing facility.

MIP also owns and leases to 4Front subsidiaries a regulated cannabis plant in Massachusetts and a regulated regulated cannabis plant in Washington DC. Assuming full reimbursement of tenants for lease improvements in Illinois, IIP’s total investment in 4Front leases is expected to be $ 83.25 million, or approximately 431,000 square feet.

As a pioneering Real Estate Investment Trust (REIT) for the regulated cannabis industry, IIP partners with experienced regulated cannabis operators and serves as a source of capital by acquiring and renting their properties and offering other creative properties. based on capital decisions.

“We are delighted to be expanding our long-term real estate partnership with 4Front with this new greenfield project in Illinois,” said Paul Smithers, President and CEO of IIP. “We look forward to working closely with the 4Front team in the coming months to develop this state-of-the-art facility, which we expect will provide 4Front with the amazing, cost-effective scalability and tightly controlled manufacturing environment for the quality products that 4Front is renowned for. New Frontier predicts Illinois will be among the top three states with the highest regulated cannabis sales by 2025, and we believe 4Front will be well positioned to meet this continuing growth in demand. ”

4Front is a national vertically integrated multi-state cannabis operator that owns or operates operations and facilities in strategic medical and adult cannabis markets, including California, Illinois, Massachusetts, Michigan and Washington. Since its founding in 2011, 4Front has built a solid reputation for its high standards and low-cost growing and manufacturing techniques derived from successful indoor design, growing, genetics, growing processes, manufacturing, purchasing, distribution and retail. To date, 4Front has successfully marketed over 20 different cannabis brands and nearly 2,000 unique product lines, strategically distributed through wholly owned and operated Mission pharmacies and outlets in major markets. As 4Front continues to generate value for its shareholders, its team applies its decade of experience in the sector to the entire ecosystem of the cannabis industry.

“We are delighted to expand our partnership with IIP as the Illinois market continues to record a record sales streak,” said Leo Gontmacher, CEO of 4Front. “This next-generation cultivation and manufacturing venture will not only enable us to best meet the state’s strong market demand, but will also expand the scope of our innovative and low-cost cultivation and production methods. We look forward to continuing to expand our presence in Illinois by creating brands and products that appeal to consumers and adding value to our customers and shareholders. “

Illinois, the eleventh state to legalize cannabis for adults, began selling cannabis to adults early last year. In its first year of adult sales, Illinois’ regulated cannabis sales topped $ 1.0 billion in 2020, including $ 669 million in adult sales and over $ 366 million in healthcare. According to the Illinois Department of Financial and Professional Regulation, in June 2021 alone, reflecting steady and growing demand, adult cannabis sales in Illinois totaled more than $ 115 million (excluding medical cannabis sales). For the first time in the first quarter of 2021, Illinois tax revenue from regulated cannabis sales exceeded alcohol tax revenue. The IIP owns seven regulated cannabis growing and processing businesses in Illinois, representing a total expected investment of approximately $ 254.9 million, including a commitment from the IIP to fund future tenant improvements and construction at specific sites.

As of August 3, 2021, IIP owned 73 properties located in Arizona, California, Colorado, Florida, Illinois, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, North Dakota, Ohio, Pennsylvania , Texas, Virginia and other countries. Washington, DC, representing a total of approximately 6.8 million square feet (including approximately 2.4 million square feet under development / renovation) that were leased at 100% for a weighted average remaining lease term of approximately 16.7 years. As of August 3, 2021, the IIP has committed approximately USD 1.7 billion across its entire portfolio, including capital invested to date (excluding transaction costs) and additional capital commitments to finance future construction and improvement of tenants at the IIP facilities, but excluding a loan of $ 18.5 million from the IIP. a developer to build a regulated cannabis growing and processing facility in California.

On innovative industrial property

Innovative Industrial Properties, Inc. is a Maryland-based self-improvement corporation specializing in the acquisition, ownership and management of specialized industrial property leased to experienced government licensed operators for their regulated cannabis growing businesses. Innovative Industrial Properties, Inc. decided to be taxed as a real estate investment fund for the year ended 31 December 2017. Additional information is available on the website www.innovativeindustrialproperties.com

Industrial Property Innovation Outlook Statements

This press release contains statements that IIP considers “forward-looking statements” within the meaning of the safeguard provisions of the Private Securities Litigation Reform Act of 1995. All statements other than historical fact, including but not limited to statements regarding the development and rental of properties in Illinois, 4Front, and the regulated Illinois cannabis market are forward-looking statements. When used in this press release, words such as “expect,” “intend,” “plan,” “estimate,” “assume,” “believe,” or “should,” or negate them, or similar terminology, are generally are intended to indicate forward-looking statements. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such statements. Investors should not place undue reliance on forward-looking statements. IIP assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

See the original version at businesswire.com: https://www.businesswire.com/news/home/20210803006138/en/

Contacts

Katherine Hastings
Chief Financial Officer
Innovative Industrial Properties, Inc.
(858) 997-3332

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