Innovative Industrial Properties (IIPR) 10-Q 3 Aug 23 2023 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2023	Aug. 03, 2023
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2023
Document Transition Report	false
Entity File Number	001-37949
Entity Registrant Name	Innovative Industrial Properties, Inc.
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	81-2963381
Entity Address, Address Line One	1389 Center Drive, Suite 200
Entity Address, City or Town	Park City
Entity Address, State or Province	UT
Entity Address, Postal Zip Code	84098
City Area Code	858
Local Phone Number	997-3332
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		28,039,982
Entity Central Index Key	0001677576
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Amendment Flag	false
Common Stock
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	IIPR
Security Exchange Name	NYSE
Series A Preferred Stock
Title of 12(b) Security	Series A Preferred Stock, par value $0.001 per share
Trading Symbol	IIPR-PA
Security Exchange Name	NYSE

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Real estate, at cost:
Land	$ 142,524	$ 139,953
Buildings and improvements	2,081,731	2,010,628
Construction in progress	117,413	54,106
Total real estate, at cost	2,341,668	2,204,687
Less accumulated depreciation	(169,658)	(138,405)
Net real estate held for investment	2,172,010	2,066,282
Construction loan receivable	20,917	18,021
Cash and cash equivalents	92,602	87,122
Restricted cash	1,450	1,450
Investments	72,726	200,935
Right of use office lease asset	1,550	1,739
In-place lease intangible assets, net	8,675	9,105
Other assets, net	26,325	30,182
Total assets	2,396,255	2,414,836
Liabilities and stockholders' equity
Exchangeable Senior Notes, net	4,414	6,380
Notes due 2026, net	295,772	295,115
Building improvements and construction funding payable	21,479	29,376
Accounts payable and accrued expenses	8,440	10,615
Dividends payable	51,080	50,840
Rent received in advance and tenant security deposits	58,482	58,716
Other liabilities	3,368	1,901
Total liabilities	443,035	452,943
Commitments and contingencies (Notes 6 and 11)
Stockholders' equity:
Preferred stock, par value $0.001 per share, 50,000,000 shares authorized: 9.00% Series A cumulative redeemable preferred stock, $15,000 liquidation preference ($25.00 per share), 600,000 shares issued and outstanding at June 30, 2023 and December 31, 2022	14,009	14,009
Common stock, par value $0.001 per share, 50,000,000 shares authorized: 28,040,054 and 27,972,830 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively	28	28
Additional paid-in capital	2,076,357	2,065,248
Dividends in excess of earnings	(137,174)	(117,392)
Total stockholders' equity	1,953,220	1,961,893
Total liabilities and stockholders' equity	$ 2,396,255	$ 2,414,836

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Preferred stock, Par Value (in dollars per share)	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	50,000,000	50,000,000
Preferred Stock, Shares Outstanding	28,040,054
Common Stock, Par Value (in dollars per share)	$ 0.001	$ 0.001
Common Stock, Shares Authorized	50,000,000	50,000,000
Common Stock, Shares Issued	28,040,054	27,972,830
Common Stock, Shares Outstanding	28,040,054	27,972,830
Series A Preferred Stock
Preferred stock, Par Value (in dollars per share)	$ 0.001
Preferred Stock, Dividend Rate, Percentage	9%	9%
Preferred Stock, Liquidation Preference, Value	$ 15,000	$ 15,000
Preferred Stock, Liquidation Preference Per Share	$ 25	$ 25
Preferred Stock, Shares Issued	600,000	600,000
Preferred Stock, Shares Outstanding	600,000	600,000

Condensed Consolidated Statemen

Condensed Consolidated Statements of Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Revenues:
Rental (including tenant reimbursements)	$ 75,919	$ 69,995	$ 151,448	$ 134,109
Other	538	516	1,076	906
Total revenues	76,457	70,511	152,524	135,015
Expenses:
Property expenses	5,759	2,427	11,382	4,409
General and administrative expense	10,570	8,707	20,943	17,484
Depreciation and amortization expense	16,704	15,233	33,418	29,101
Total expenses	33,033	26,367	65,743	50,994
Income from operations	43,424	44,144	86,781	84,021
Interest and other income	2,317	581	4,550	638
Interest expense	(4,472)	(4,504)	(8,992)	(9,270)
(Loss) gain on exchange of Exchangeable Senior Notes		(7)	22	(125)
Net income	41,269	40,214	82,361	75,264
Preferred stock dividends	(338)	(338)	(676)	(676)
Net income attributable to common stockholders	$ 40,931	$ 39,876	$ 81,685	$ 74,588
Net income attributable to common stockholders per share (Note 8):
Basic	$ 1.45	$ 1.42	$ 2.89	$ 2.77
Diluted	$ 1.44	$ 1.42	$ 2.87	$ 2.75
Weighted-average shares outstanding:
Basic	27,981,517	27,850,561	27,965,720	26,741,568
Diluted	28,257,239	28,036,690	28,239,841	27,159,774

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Series A Preferred Stock Preferred Stock	Common Stock	Additional Paid-In-Capital Adjustment	Additional Paid-In-Capital	Dividends in Excess of Earnings Adjustment	Dividends in Excess of Earnings	Adjustment	Total
Balances at beginning of period at Dec. 31, 2021	$ 14,009	$ 26	$ (1,340)	$ 1,672,882	$ 728	$ (75,218)	$ (612)	$ 1,611,699
Balances at beginning of period (in shares) at Dec. 31, 2021		25,612,541
Net Income (Loss)						75,264		75,264
Issuance of unvested restricted stock, net of forfeitures				(2,441)				(2,441)
Issuance of unvested restricted stock, net of forfeitures (in shares)		15,174
Exchange of Exchangeable Senior Notes				26,665				26,665
Exchange of Exchangeable Senior Notes (in shares)		412,901
Net proceeds from sale of common stock		$ 2		351,986				351,988
Net proceeds from sale of common stock (in shares)		1,932,813
Preferred stock dividend						(676)		(676)
Common stock dividend						(94,931)		(94,931)
Stock-based compensation				8,816				8,816
Balances at end of period at Jun. 30, 2022	14,009	$ 28		2,056,568		(94,833)		1,975,772
Balances at end of period (in shares) at Jun. 30, 2022		27,973,429
Balances at beginning of period at Mar. 31, 2022	14,009	$ 26		1,718,234		(85,608)		1,646,661
Balances at beginning of period (in shares) at Mar. 31, 2022		26,107,769
Net Income (Loss)						40,214		40,214
Issuance of unvested restricted stock, net of forfeitures (in shares)		2,811
Exchange of Exchangeable Senior Notes				3,014				3,014
Exchange of Exchangeable Senior Notes (in shares)		47,059
Net proceeds from sale of common stock		$ 2		330,883				330,885
Net proceeds from sale of common stock (in shares)		1,815,790
Preferred stock dividend						(338)		(338)
Common stock dividend						(49,101)		(49,101)
Stock-based compensation				4,437				4,437
Balances at end of period at Jun. 30, 2022	14,009	$ 28		2,056,568		(94,833)		1,975,772
Balances at end of period (in shares) at Jun. 30, 2022		27,973,429
Balances at beginning of period at Dec. 31, 2022	14,009	$ 28		2,065,248		(117,392)		1,961,893
Balances at beginning of period (in shares) at Dec. 31, 2022		27,972,830
Net Income (Loss)						82,361		82,361
Issuance of unvested restricted stock, net of forfeitures				(568)				(568)
Issuance of unvested restricted stock, net of forfeitures (in shares)		35,024
Exchange of Exchangeable Senior Notes				1,964				1,964
Exchange of Exchangeable Senior Notes (in shares)		32,200
Preferred stock dividend						(676)		(676)
Common stock dividend						(101,467)		(101,467)
Stock-based compensation				9,713				9,713
Balances at end of period at Jun. 30, 2023	14,009	$ 28		2,076,357		(137,174)		1,953,220
Balances at end of period (in shares) at Jun. 30, 2023		28,040,054
Balances at beginning of period at Mar. 31, 2023	14,009	$ 28		2,071,473		(127,363)		1,958,147
Balances at beginning of period (in shares) at Mar. 31, 2023		28,034,999
Net Income (Loss)						41,269		41,269
Issuance of unvested restricted stock, net of forfeitures (in shares)		5,055
Preferred stock dividend						(338)		(338)
Common stock dividend						(50,742)		(50,742)
Stock-based compensation				4,884				4,884
Balances at end of period at Jun. 30, 2023	$ 14,009	$ 28		$ 2,076,357		$ (137,174)		$ 1,953,220
Balances at end of period (in shares) at Jun. 30, 2023		28,040,054

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash flows from operating activities
Net income	$ 82,361	$ 75,264
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	33,418	29,101
(Gain) loss on exchange of Exchangeable Senior Notes	(22)	125
Other non-cash adjustments	53	127
Stock-based compensation	9,713	8,816
Amortization of discounts on short-term investments	(2,621)	(513)
Amortization of debt discount and issuance costs	677	689
Changes in assets and liabilities
Other assets, net	3,549	2,568
Accounts payable, accrued expenses and other liabilities	(514)	(1,290)
Rent received in advance and tenant security deposits	(234)	7,094
Net cash provided by operating activities	126,380	121,981
Cash flows from investing activities
Purchases of investments in real estate	(34,906)	(129,562)
Funding of draws for improvements and construction	(111,457)	(291,408)
Funding of construction loan and other investments	(2,896)	(21,360)
Deposits in escrow for acquisitions		(600)
Purchases of short-term investments	(71,772)	(219,040)
Maturities of short-term investments	202,602	235,000
Net cash used in investing activities	(18,429)	(426,970)
Cash flows from financing activities
Issuance of common stock, net of offering costs		351,988
Dividends paid to common stockholders	(101,227)	(84,339)
Dividends paid to preferred stockholders	(676)	(676)
Taxes paid related to net share settlement of equity awards	(568)	(2,441)
Net cash (used in) provided by financing activities	(102,471)	264,532
Net increase (decrease) in cash, cash equivalents and restricted cash	5,480	(40,457)
Cash, cash equivalents and restricted cash, beginning of period	88,572	86,419
Cash, cash equivalents and restricted cash, end of period	94,052	45,962
Supplemental disclosure of cash flow information:
Cash paid during the period for interest, net of interest capitalized	8,337	8,876
Supplemental disclosure of non-cash investing and financing activities:
Accrual for current-period additions to real estate	17,021	31,210
Deposits applied for acquisitions	250	25
Accrual for common and preferred stock dividends declared	51,080	49,439
Exchange of Exchangeable Senior Notes for common stock	$ 1,964	26,665
Operating lease liability for obtaining right of use asset		$ 1,017

Organization

Organization	6 Months Ended
	Jun. 30, 2023
Organization
Organization	1. Organization As used herein, the terms “we”, “us”, “our” or the “Company” refer to Innovative Industrial Properties, Inc., a Maryland corporation, and any of our subsidiaries, including IIP Operating Partnership, LP, a Delaware limited partnership (our “Operating Partnership”). We are an internally-managed real estate investment trust (“REIT”) focused on the acquisition, ownership and management of specialized industrial properties leased to experienced, state-licensed operators for their regulated cannabis facilities. We have acquired and intend to continue to acquire our properties through sale-leaseback transactions and third-party purchases. We have leased and expect to continue to lease our properties on a triple-net lease basis, where the tenant is responsible for all aspects of and costs related to the property and its operation during the lease term, including structural repairs, maintenance, real estate taxes and insurance. We were incorporated in Maryland on June 15, 2016. We conduct our business through a traditional umbrella partnership real estate investment trust, or UPREIT structure, in which our properties are owned by our Operating Partnership, directly or through subsidiaries. We are the sole general partner of our Operating Partnership and own, directly or through subsidiaries, 100% of the limited partnership interests in our Operating Partnership.

Summary of Significant Accounti

Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements	6 Months Ended
	Jun. 30, 2023
Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements
Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements	2. Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements Basis of Presentation. This interim financial information should be read in conjunction with the audited consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Any references to square footage or occupancy percentage, and any amounts derived from these values in these notes to the condensed consolidated financial statements, are outside the scope of our independent registered public accounting firm’s review. Management believes that all adjustments of a normal, recurring nature considered necessary for a fair presentation have been included. This interim financial information does not necessarily represent or indicate what the operating results will be for the year ending December 31, 2023. Reclassification Federal Income Taxes. Use of Estimates. Reportable Segment. Acquisition of Real Estate Properties. The fair value of acquired in-place leases is derived based on our assessment of estimated lost revenue and costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased. The amounts recorded for acquired in-place leases are reflected as in-place lease intangible assets, net on our condensed consolidated balance sheets and are amortized on a straight-line basis as a component of depreciation and amortization expense over the remaining term of the applicable leases. The fair value of the above-market component of an acquired in-place operating lease is based upon the present value (calculated using a market discount rate) of the difference between (i) the contractual rents to be paid pursuant to the lease over its remaining non-cancellable lease term and (ii) our estimate of the rents that would be paid using fair market rental rates and rent escalations at the date of acquisition measured over the remaining non-cancellable term of the lease. The amount recorded for one above-market operating lease is included in other assets, net on our condensed consolidated balance sheets and is amortized on a straight-line basis as a reduction of rental revenues over the remaining term of the applicable lease. Sale of Real Estate. Gains and Losses from the Derecognition of Nonfinancial Assets Revenue from Contracts with Customers (Topic 606) ​ Cost Capitalization and Depreciation. Amounts capitalized are depreciated over estimated useful lives determined by management. We depreciate buildings and improvements based on our evaluation of the estimated useful life of each specific asset, not to exceed 40 years. For the three months ended June 30, 2023 and 2022, we recognized depreciation expense of approximately $16.5 million and $15.0 million, respectively, and for the six months ended June 30, 2023 and 2022, we recognized depreciation expense of approximately $33.0 million and $28.7 million, respectively. Depreciation expense relating to our real estate held for investment is included in depreciation and amortization expense in our condensed consolidated statements of income. We depreciate office equipment and furniture and fixtures over estimated useful lives ranging from three Determining whether expenditures meet the criteria for capitalization and the assignment of depreciable lives requires management to exercise significant judgment. Project costs that are clearly associated with the acquisition and development or redevelopment of a real estate project, for which we are the accounting owner, are capitalized as a cost of that project. Expenditures that meet one or more of the following criteria generally qualify for capitalization: ● the expenditure provides benefit in future periods; and ● the expenditure extends the useful life of the asset beyond our original estimates. We define redevelopment properties as existing properties for which we expect to spend significant development and construction costs that are not reimbursements to tenants for improvements at the properties. When existing properties are determined to be redevelopment properties, the net carrying value of the buildings and improvements are transferred to construction in progress while the redevelopment activities are in process. During the six months ended June 30, 2023, we reclassified the net carrying value of the buildings and improvements totaling approximately $51.2 million to construction in progress relating to an existing property that was placed into redevelopment. Costs capitalized to construction in progress related to redevelopment properties are transferred to buildings and improvements at historical cost of the properties as the redevelopment project or phases of projects are placed in service. Provision for Impairment. Long-lived assets are individually evaluated for impairment when conditions exist that may indicate that the carrying amount of a long-lived asset may not be recoverable. The carrying amount of a long-lived asset to be held and used is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Impairment indicators or triggering events for long-lived assets to be held and used are assessed by project and include significant fluctuations in estimated net operating income, occupancy changes, significant near-term lease expirations, current and historical operating and/or cash flow losses, construction costs, estimated completion dates, rental rates, and other market factors. We assess the expected undiscounted cash flows based upon numerous factors, including, but not limited to, construction costs, available market information, current and historical operating results, known trends, current market/economic conditions that may affect the property, and our assumptions about the use of the asset, including, if necessary, a probability-weighted approach if multiple outcomes are under consideration. Upon determination that an impairment has occurred, a write-down is recognized to reduce the carrying amount to its estimated fair value. We may adjust depreciation of properties that are expected to be disposed of or redeveloped prior to the end of their useful lives. No impairment losses were recognized during the six months ended June 30, 2023 and 2022. Revenue Recognition. For the three months ended June 30, 2023, rental revenue recognized included the application of approximately $1.5 million of security deposits for rent with two tenants in connection with lease amendments. For the six months ended June 30, 2023, rental revenue recognized included the application of approximately $3.1 million of security deposits applied for rent with two tenants who were in default under their respective lease agreements and approximately $2.7 million of security deposits for rent with two tenants in connection with lease amendments. Construction Loan. In February 2023, we amended the construction loan to provide for, among other things: (1) the additional capital commitment of the borrower into the project of $1.0 million; (2) our agreement to fund an additional $4.5 million into the project; (3) an increase in the interest rate effective April 1, 2023; (4) an extension of the loan term to December 31, 2023; and (5) the provision of additional collateral from the borrower for the loan. Interest on the loan continued to accrue through March 31, 2023, with monthly payment of interest having commenced April 1, 2023. ​ Cash and Cash Equivalents Restricted Cash Investments. Exchangeable Notes. In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 simplifies the accounting for convertible debt by eliminating the beneficial conversion and cash conversion accounting models, and convertible debt proceeds, unless issued with a substantial premium or an embedded conversion feature, will no longer be allocated between debt and equity components. ASU 2020-06 also updates the earnings per share calculation and requires entities to assume share settlement when the convertible debt can be settled in cash or shares. We adopted ASU 2020-06 on January 1, 2022 and recognized a cumulative-effect adjustment of approximately $728,000 to the opening balance of retained earnings and derecognized approximately $1.3 million of the remaining equity component relating to the outstanding principal balance of our Exchangeable Senior Notes at the date of adoption. Deferred Financing Costs. Stock-Based Compensation. Lease Accounting. existing lease space and measured the lease liability to the expansion space based on the present value of the respective future lease payments (excluding the extension option that we are not reasonably certain to exercise), discounted using the estimated incremental borrowing rate of 5.5%, which was the interest rate at that time that we estimate we would have had to pay to borrow on a collateralized basis over a similar term for an amount equal to the lease payments. Subsequently, the lease liability is accreted by applying a discount rate established at the lease commencement date to the lease liability balance as of the beginning of the period and is reduced by the payments made during the period. The right-of-use asset is measured based on the corresponding lease liability. We did not incur any initial direct leasing costs or exchange any other consideration with the landlord prior to the commencement of the lease. Subsequently, the right-of-use asset is amortized on a straight-line basis during the lease term. For both the three months ended June 30, 2023 and 2022, we recognized office lease expense of approximately $122,000, and for the six months ended June 30, 2023 and 2022, we recognized office lease expense of approximately $243,000 and $223,000, respectively, which are included in general and administrative expenses in our condensed consolidated statements of income. For the six months ended June 30, 2023 and 2022, amounts paid and classified as operating activities in our condensed consolidated statements of cash flows for the office lease were approximately $248,000 and $161,000, respectively. As lessor, for each of our real estate transactions involving the leaseback of the related property to the seller or affiliates of the seller, we determine whether these transactions qualify as sale and leaseback transactions under the accounting guidance. For these transactions, we consider various inputs and assumptions including, but not necessarily limited to, lease terms, renewal options, discount rates, and other rights and provisions in the purchase and sale agreement, lease and other documentation to determine whether control has been transferred to the Company or remains with the lessee. A transaction involving a sale leaseback will be treated as a purchase of a real estate property if it is considered to transfer control of the underlying asset from the lessee. A lease will be classified as direct-financing if risks and rewards are conveyed without the transfer of control and will be classified as a sales-type lease if control of the underlying asset is transferred to the lessee. Otherwise, the lease is treated as an operating lease. These criteria also include estimates and assumptions regarding the fair value of the leased facilities, minimum lease payments, the economic useful life of the facilities, the existence of a purchase option, and certain other terms in the lease agreements. The lease accounting guidance requires accounting for a transaction as a financing in a sale leaseback when the seller-lessee is provided an option to purchase the property from the landlord at the tenant’s option. Substantially all of our leases continue to be classified as operating leases and we continue to record revenue for each of our properties on a cash basis. Our tenant reimbursable revenue and property expenses continue to be presented on a gross basis as rental revenues and as property expenses, respectively, on our condensed consolidated statements of income. Property taxes paid directly by the lessee to a third party continue to be excluded from our condensed consolidated financial statements. Lease amendments are evaluated to determine if the modification grants the lessee an additional right-of-use not included in the original lease and if the lease payments increase commensurate with the standalone price of the additional right-of-use, adjusted for the circumstances of the particular contract. If both conditions are present, the lease amendment is accounted for as a new lease that is separate from the original lease. Our leases generally contain options to extend the lease terms at the prevailing market rate or at the expiring rental rate at the time of expiration. Certain of our leases provide the lessee with a right of first refusal or right of first offer in the event we market the leased property for sale. Concentration of Credit Risk The following table sets forth the five tenants in our portfolio that represented the largest percentage of our total rental revenues for the three and six months ended June 30, 2023 and 2022, including tenant reimbursements: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended ​ ​ June 30, 2023 ​ ​ ​ ​ ​ Percentage of ​ ​ Number of Rental ​ Leases Revenue ​ PharmaCann Inc. ("PharmaCann") 11 ​ 15 % Ascend Wellness Holdings, Inc. ("Ascend") ​ 4 ​ 10 % Green Thumb Industries, Inc. ("GTI") 3 ​ 8 % Curaleaf Holdings, Inc. ("Curaleaf") ​ 8 ​ 7 % Trulieve Cannabis Corp. ("Trulieve") 6 ​ 7 % ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Six Months Ended ​ ​ June 30, 2023 ​ ​ ​ ​ ​ Percentage of ​ ​ Number of Rental ​ Leases Revenue ​ PharmaCann 11 ​ 15 % Ascend ​ 4 ​ 10 % GTI 3 ​ 7 % SH Parent, Inc. ("Parallel") (1) ​ 4 ​ 7 % Curaleaf 8 ​ 7 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended ​ For the Six Months Ended ​ ​ June 30, 2022 ​ June 30, 2022 ​ ​ ​ ​ ​ Percentage of ​ ​ ​ Percentage of ​ ​ Number of Rental Number of Rental ​ Leases Revenue Leases Revenue ​ PharmaCann 11 ​ 13 % 11 ​ 14 % Parallel ​ 4 ​ 10 % 4 ​ 10 % Ascend 4 ​ 10 % 4 ​ 9 % Kings Garden Inc. ("Kings Garden") (2) ​ 6 ​ 8 % 6 ​ 8 % Trulieve 6 ​ 6 % 6 ​ 7 % (1) Commencing in November 2022, Parallel defaulted on its obligations to pay rent at one of our Pennsylvania properties . In February 2023, Parallel defaulted on its obligations to pay rent at one of our Texas properties, and we regained possession of that property in March 2023. See Note 11 “Commitments and Contingencies — Litigation” to our condensed consolidated financial statements for more information. Excluding security deposits applied for payment of rent for Parallel at one property in Pennsylvania and one property in Texas of approximately $1.8 million and $395,000 , respectively, Parallel would have represented 6% of our total rental revenues for the six months ended June 30, 2023. (2) In July 2022, Kings Garden defaulted on its obligations to pay rent at all of the properties it leases with us, and pursuant to a confidential, conditional settlement agreement executed on September 11, 2022 between us and Kings Garden, we terminated the leases for two properties that were in development or redevelopment as of June 30, 2023 and regained possession of those properties. See Note 11 “Commitments and Contingencies — Litigation” to our condensed consolidated financial statements for more information. In each of the tables above, these leases include leases with affiliates of each entity, for which the entity has provided a corporate guaranty. As of June 30, 2023, our largest property was located in New York and accounted for approximately 5.4% of our net real estate held for investment. No other properties accounted for more than 5% of our net real estate held for investment as of June 30, 2023. As of December 31, 2022, none of our properties individually represented more than 5% of our net real estate held for investment. We have deposited cash with financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. As of June 30, 2023, we had cash accounts in excess of FDIC insured limits. We have not experienced any losses in such accounts.

Common Stock

Common Stock	6 Months Ended
	Jun. 30, 2023
Common Stock.
Common Stock	3. Common Stock As of June 30, 2023, the Company was authorized to issue up to 50,000,000 shares of common stock, par value $0.001 per share, and there were 28,040,054 shares of common stock issued and outstanding. ​ In January 2023, we terminated the previously existing “at-the-market” offering program and entered into new equity distribution agreements with four sales agents, pursuant to which we may offer and sell from time to time through an “at-the-market” offering program (the “ATM Program”) up to $500.0 million in shares of our common stock. As of June 30, 2023, we had not sold any shares of common stock under the ATM Program. ​ During the six months ended June 30, 2023, we issued 32,200 shares of our common stock upon exchange by holders of $2.0 million of outstanding principal amount of our Exchangeable Senior Notes.

Preferred Stock

Preferred Stock	6 Months Ended
	Jun. 30, 2023
Preferred Stock.
Preferred Stock	4. Preferred Stock As of June 30, 2023, the Company was authorized to issue up to 50,000,000 shares of preferred stock, par value $0.001 per share, and there were 600,000 shares issued and outstanding ​

Dividends

Dividends	6 Months Ended
	Jun. 30, 2023
Dividends
Dividends	5. Dividends The following table describes the dividends declared by the Company during the six months ended June 30, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amount ​ Dividend Dividend Declaration Date ​ Security Class ​ Per Share ​ Period Covered ​ Paid Date ​ Amount ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In thousands) March 15, 2023 ​ Common stock ​ $ 1.80 ​ January 1, 2023 to March 31, 2023 ​ April 14, 2023 ​ $ 50,725 March 15, 2023 ​ Series A preferred stock ​ $ 0.5625 ​ January 15, 2023 to April 14, 2023 ​ April 14, 2023 ​ $ 338 June 15, 2023 ​ Common stock ​ $ 1.80 ​ April 1, 2023 to June 30, 2023 ​ July 14, 2023 ​ $ 50,742 June 15, 2023 ​ Series A preferred stock ​ $ 0.5625 ​ April 15, 2023 to July 14, 2023 ​ July 14, 2023 ​ $ 338 ​

Investments in Real Estate

Investments in Real Estate	6 Months Ended
	Jun. 30, 2023
Investments in Real Estate
Investments in Real Estate	6. Investments in Real Estate Acquisitions The Company acquired the following properties during the six months ended June 30, 2023 (dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Rentable ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Square ​ Purchase ​ Transaction ​ ​ ​ ​ Property Market Closing Date Feet (1) Price Costs Total ​ Susquehanna Street Pennsylvania ​ ​ February 15, 2023 ​ 58,000 ​ $ 15,000 ​ $ 26 ​ $ 15,026 ​ Boltonfield Street Ohio ​ ​ March 3, 2023 ​ 157,000 ​ 20,100 ​ 29 ​ 20,129 (2) Total ​ ​ ​ ​ ​ ​ 215,000 ​ $ 35,100 ​ $ 55 ​ $ 35,155 (3) ​ (1) Includes expected rentable square feet at completion of construction of certain properties. (2) The tenant is expected to complete improvements at the property, for which we agreed to provide funding of up to $21.9 million. (3) Approximately $2.6 million was allocated to land and approximately $32.6 million was allocated to building and improvements. ​ Acquired In-Place Lease Intangible Assets In-place lease intangible assets and related accumulated amortization as of June 30, 2023 and December 31, 2022 is as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2023 December 31, 2022 In-place lease intangible assets ​ $ 9,979 ​ $ 9,979 Accumulated amortization (1,304) ​ (874) In-place lease intangible assets, net ​ $ 8,675 ​ $ 9,105 ​ Amortization of in-place lease intangible assets classified in depreciation and amortization expense in our condensed consolidated statements of income was approximately $215,000 and $213,000 for the three months ended June 30, 2023 and 2022, respectively, and was approximately $430,000 and $411,000 for the six months ended June 30, 2023 and 2022, respectively. The weighted-average remaining amortization period of the acquired in-place leases was approximately 10.0 years, and the estimated annual amortization of the value of the acquired in-place leases as of June 30, 2023 is as follows (in thousands): ​ ​ ​ ​ ​ Year Amount 2023 (six months ending December 31) ​ $ 430 2024 ​ 860 2025 ​ 860 2026 ​ 860 2027 ​ 860 Thereafter ​ 4,805 Total ​ $ 8,675 ​ Above-Market Lease The above-market lease and related accumulated amortization included in other assets, net on our condensed consolidated balance sheets as of June 30, 2023 and December 31, 2022 is as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2023 December 31, 2022 Above-market lease ​ $ 1,054 ​ $ 1,054 Accumulated amortization (141) ​ (95) Above-market lease, net ​ $ 913 ​ $ 959 ​ The above-market lease is amortized on a straight-line basis as a reduction to rental revenues over the remaining lease term of approximately 9.8 years. For the three months ended June 30, 2023 and 2022, the amortization of the above-market lease was approximately $23,000 in each period. For the six months ended June 30, 2023 and 2022, the amortization of the above-market lease was approximately $46,000 in each period. Additional Improvement Allowances In February 2023, we amended our lease with a subsidiary of Ascend at one of our New Jersey properties, increasing the improvement allowance under the lease by $15.0 million to a total of approximately $19.6 million, which also resulted in a corresponding adjustment to the base rent for the lease at the property. We also amended each of our leases with Ascend to include cross-default provisions applicable to each lease. ​ In February 2023, we amended our lease and development agreement with PharmaCann at one of our New York properties, increasing the construction fund by $15.0 million to a total of approximately $93.5 million, which also resulted in a corresponding adjustment to the base rent for the lease at the property. We also amended each of our leases with PharmaCann to include cross-default provisions applicable to each lease. ​ In February 2023, we amended our lease with a subsidiary of Goodness Growth Holdings Inc. at one of our New York properties, increasing the improvement allowance under the lease by $4.0 million to a total of approximately $53.4 million, which also resulted in a corresponding adjustment to the base rent for the lease at the property. We also amended each of our leases with Goodness Growth Holdings Inc. to include cross-default provisions applicable to each lease. Lease Amendments In January 2023 ​ In January 2023, we executed a lease amendment with Calyx Peak, Inc. at our Missouri property, which (1) extended the term of the lease; and (2) provided for 100% base rent deferral through March 31, 2023, with pro rata monthly payback of the deferred rent over the twelve-month period starting April 2023. ​ In March 2023, we executed a lease amendment with Temescal Wellness of Massachusetts, LLC (“Temescal”) at our Massachusetts property, which (1) provided for temporary reduced base rent from April 2023 through January 2024 to be partially paid through application of security deposits, with pro rata payback of those security deposits over twelve months starting in February 2024; (2) extended the lease term; and (3) increased base rent for the remainder of the term of the lease. ​ New Lease ​ In June 2023, we executed a new long-term lease with a tenant at our property located at 68860 Perez Road in Cathedral City, California that was previously leased to Kings Garden, which is under construction as of June 30, 2023. ​ Capitalized Costs ​ During the six months ended June 30, 2023, we capitalized costs of approximately $101.8 million and funded approximately $111.5 million relating to improvements and construction activities at our properties. Property Disposition In March 2023, we sold the portfolio of four properties in California previously leased to affiliates of Medical Investor Holdings, LLC (“Vertical”) for $16.2 million (excluding transaction costs) and provided a secured loan for $16.1 million to the buyer of the properties. The loan matures on February 29, 2028 with two options to extend the maturity for twelve months, conditional in each instance on the payment of an extension fee and at least $500,000 of the principal balance. The loan is interest only and payments are payable monthly in advance. The transaction did not qualify for recognition as a completed sale under GAAP since not all of the criteria were met. Accordingly, we have not derecognized the assets transferred on our condensed consolidated balance sheets. All consideration received, as well as any future payments, from the buyer will be recognized as a deposit liability and will be included in other liabilities on our condensed consolidated balance sheet until such time the criteria for recognition as a sale have been met. As of June 30, 2023, we received interest payments of approximately $537,000. In addition, as we have not met all of the held-for-sale criteria, land and building and improvements with a gross carrying value of approximately $3.4 million and approximately $13.9 million, respectively, and accumulated depreciation of approximately $1.5 million as of June 30, 2023, remain on the condensed consolidated balance sheet, and the buildings and improvements continue to be depreciated. Future Contractual Minimum Rent Future contractual minimum rent (including base rent and property management fees) under the operating leases as of June 30, 2023 for future periods is summarized as follows (in thousands): ​ ​ ​ ​ ​ Year Contractual Minimum Rent 2023 (six months ending December 31) ​ $ 143,487 2024 ​ ​ 296,831 2025 ​ 305,564 2026 ​ 314,623 2027 ​ 323,953 Thereafter ​ 4,167,236 Total ​ $ 5,551,694 ​

Debt

Debt	6 Months Ended
	Jun. 30, 2023
Debt
Debt	7. Debt Exchangeable Senior Notes As of June 30, 2023, our Operating Partnership had outstanding approximately $4.4 million principal amount of 3.75% Exchangeable Senior Notes due 2024 (the “Exchangeable Senior Notes”). The Exchangeable Senior Notes are senior unsecured obligations of our Operating Partnership, are fully and unconditionally guaranteed by us and our Operating Partnership’s subsidiaries and are exchangeable for cash, shares of our common stock, or a combination of cash and shares of our common stock, at our Operating Partnership’s option, at any time prior to the close of business on the second scheduled trading day immediately preceding the stated maturity date. The exchange rate for the Exchangeable Senior Notes at June 30, 2023 was 16.74033 shares of our common stock per $1,000 principal amount of Notes and the exchange price at June 30, 2023 was approximately $59.74 per share of our common stock. The exchange rate and exchange price are subject to adjustment in certain circumstances. The Exchangeable Senior Notes will pay interest semiannually at a rate of 3.75% per annum and will mature on February 21, 2024, unless earlier exchanged or repurchased in accordance with their terms. Our Operating Partnership will not have the right to redeem the Exchangeable Senior Notes prior to maturity, but may be required to repurchase the Exchangeable Senior Notes from holders under certain circumstances. At June 30, 2023, the if-exchanged value of the Exchangeable Senior Notes exceeded the principal amount by approximately $986,000. During the six months ended June 30, 2023, we issued 32,200 shares of our common stock upon exchanges by holders of $2.0 million of outstanding principal amount of our Exchangeable Senior Notes. For the six months ended June 30, 2023, we recognized a gain on the exchange totaling approximately $22,000 , resulting from the difference between the fair value and carrying value of the debt as of the date of the exchange. The issuance of the shares pursuant to the exchanges resulted in a net non-cash increase to our additional paid-in capital account of approximately $2.0 million for the six months ended June 30, 2023. During the three and six months ended June 30, 2022, we issued 47,059 and 412,901 shares, respectively, of our common stock upon exchanges by holders of approximately $3.1 million and $26.9 million, respectively, of outstanding principal amount of our Exchangeable Senior Notes. We recognized a loss on the exchanges totaling approximately $7,000 and $125,000 for the three and six months ended June 30, 2022, respectively, resulting from the difference between the fair value and carrying value of the debt as of the date of the exchange. The issuance of the shares pursuant to the exchanges resulted in a non-cash increase to our additional paid-in capital account of approximately $3.0 million and $26.7 million for the three and six months ended June 30, 2022, respectively. The following table details our interest expense related to the Exchangeable Senior Notes (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended June 30, ​ For the Six Months Ended June 30, ​ 2023 2022 2023 2022 Cash coupon $ 42 $ 55 $ 99 $ 331 Amortization of issuance cost ​ 8 ​ 13 ​ 20 ​ 71 Total interest expense $ 50 $ 68 $ 119 $ 402 ​ The following table details the carrying value of our Exchangeable Senior Notes (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2023 December 31, 2022 Principal amount $ 4,436 $ 6,436 Unamortized issuance cost (22) ​ (56) Carrying value $ 4,414 $ 6,380 ​ Accrued interest payable for the Exchangeable Senior Notes as of June 30, 2023 and December 31, 2022 was approximately $49,000 and $70,000, respectively, and is included in accounts payable and accrued expenses on our condensed consolidated balance sheets. Notes due 2026 On May 25, 2021, our Operating Partnership issued $300.0 million aggregate principal amount of its 5.50% Senior Notes due 2026 (the “Notes due 2026”). The Notes due 2026 are senior unsecured obligations of our Operating Partnership, are fully and unconditionally guaranteed by us and our Operating Partnership’s subsidiaries and rank equally in right of payment with all of the Operating Partnership’s existing and future senior unsecured indebtedness, including the Exchangeable Senior Notes. However, the Notes due 2026 are effectively subordinated to any of the Company’s, the Operating Partnership’s and the Operating Partnership’s subsidiaries’ future secured indebtedness to the extent of the value of the assets securing such indebtedness. The Notes due 2026 will pay interest semiannually at a rate of 5.50% per year and will mature on May 25, 2026. The terms of the Notes due 2026 are governed by an indenture, dated May 25, 2021, among the Operating Partnership, as issuer, the Company and the Operating Partnership’s subsidiaries, as guarantors, TMI Trust Company, as trustee (as successor-in-interest to GLAS Trust Company LLC), and Securities Transfer Corporation, as registrar (as successor-in-interest to GLAS Trust Company LLC). The terms of the indenture provide that if the debt rating on the Notes due 2026 is downgraded or withdrawn entirely, interest on the Notes due 2026 will increase to a range of 6.0% to 6.5% based on such debt rating. In connection with the issuance of the Notes due 2026, we recorded approximately $6.8 million of issuance costs, which are being amortized using the effective interest method and recognized as non-cash interest expense over the term of the Notes due 2026. The following table details our interest expense related to the Notes due 2026 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended June 30, ​ For the Six Months Ended June 30, ​ 2023 ​ 2022 2023 ​ 2022 Cash coupon ​ $ 4,125 ​ $ 4,125 ​ $ 8,250 ​ $ 8,250 Amortization of issuance cost ​ 331 ​ ​ 311 ​ ​ 657 ​ ​ 618 Capitalized interest ​ (34) ​ ​ — ​ ​ (34) ​ ​ — Total interest expense ​ $ 4,422 ​ $ 4,436 ​ $ 8,873 ​ $ 8,868 ​ The following table details the carrying value of our Notes due 2026 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2023 December 31, 2022 Principal amount $ 300,000 $ 300,000 Unamortized issuance cost (4,228) ​ (4,885) Carrying value $ 295,772 $ 295,115 ​ The Operating Partnership may redeem some or all of the Notes due 2026 at its option at any time at the applicable redemption price. If the Notes due 2026 are redeemed prior to February 25, 2026, the redemption price will be equal to 100% of the principal amount of the Notes due 2026 being redeemed, plus a make-whole premium and accrued and unpaid interest thereon to, but excluding, the applicable redemption date. If the Notes due 2026 are redeemed on or after February 25, 2026, the redemption price will be equal to 100% of the principal amount of the Notes due 2026 being redeemed, plus accrued and unpaid interest thereon to, but excluding, the applicable redemption date. The terms of the indenture for the Notes due 2026 require compliance with various financial covenants, including minimum level of debt service coverage and limits on the amount of total leverage and secured debt maintained by the Operating Partnership. Management believes that it was in compliance with those covenants as of June 30, 2023. Accrued interest payable for the Notes due 2026 as of June 30, 2023 and December 31, 2022 was approximately $2.1 million and $2.1 million, respectively, and is included in accounts payable and accrued expenses on our condensed consolidated balance sheets. The following table summarizes the principal payments on our outstanding indebtedness as of June 30, 2023 (in thousands): ​ ​ ​ ​ Payments Due ​ ​ by Year Amount 2023 (six months ending December 31) ​ $ — 2024 ​ ​ 4,436 2025 ​ ​ — 2026 ​ ​ 300,000 2027 ​ ​ — Thereafter ​ ​ — Total ​ $ 304,436 ​

Net Income Per Share

Net Income Per Share	6 Months Ended
	Jun. 30, 2023
Net Income Per Share
Net Income Per Share	8. Net Income Per Share Grants of restricted stock and restricted stock units (“RSUs”) of the Company in share-based payment transactions are considered participating securities prior to vesting and, therefore, are considered in computing basic earnings per share under the two-class method. The two-class method is an earnings allocation method for calculating earnings per share when a company’s capital structure includes either two or more classes of common stock or common stock and participating securities. Earnings per basic share under the two-class method is calculated based on dividends declared on common shares and other participating securities (“distributed earnings”) and the rights of participating securities in any undistributed earnings, which represents net income remaining after deduction of dividends accruing during the period. The undistributed earnings are allocated to all outstanding common shares and participating securities based on the relative percentage of each security to the total number of outstanding participating securities. Earnings per basic share represents the summation of the distributed and undistributed earnings per share class divided by the total number of shares. Through June 30, 2023, all of the Company’s participating securities received dividends or dividend equivalents at an equal dividend rate per share or unit. As a result, distributions to participating securities for the three and six months ended June 30, 2023 and 2022 have been included in net income attributable to common stockholders to calculate net income per basic and diluted share. The 74,260 and 87,437 shares necessary to settle the Exchangeable Senior Notes on the if-exchanged method basis were dilutive for the three and six months ended June 30, 2023, respectively, and were included in the computation of diluted earnings per share. The 103,742 and 304,348 shares necessary to settle the Exchangeable Senior Notes on the if-exchanged method basis were dilutive for the three and six months ended June 30, 2022, respectively, and were included in the computation of diluted earnings per share. For the three and six months ended June 30, 2023 and 2022, the performance share units (“PSUs”) granted to certain employees were not included in dilutive securities as the performance thresholds for vesting of the PSUs were not met as measured as of the respective dates (see Note 10 for further discussion of PSUs). Computations of net income per basic and diluted share (in thousands, except share and per share data) were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended ​ For the Six Months Ended ​ ​ June 30, ​ June 30, ​ 2023 2022 2023 2022 Net income ​ $ 41,269 ​ $ 40,214 ​ $ 82,361 ​ $ 75,264 Preferred stock dividends ​ (338) ​ (338) ​ ​ (676) ​ ​ (676) Distribution to participating securities ​ (373) ​ (207) ​ ​ (734) ​ ​ (409) Net income attributable to common stockholders used to compute net income per share – basic ​ ​ 40,558 ​ ​ 39,669 ​ ​ 80,951 ​ ​ 74,179 Dilutive effect of Exchangeable Senior Notes ​ ​ 50 ​ ​ 68 ​ ​ 119 ​ ​ 402 Net income attributable to common stockholders used to compute net income per share – diluted ​ $ 40,608 ​ $ 39,737 ​ $ 81,070 ​ $ 74,581 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average common shares outstanding: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ 27,981,517 ​ 27,850,561 ​ ​ 27,965,720 ​ ​ 26,741,568 Restricted stock and RSUs ​ ​ 201,462 ​ ​ 82,387 ​ ​ 186,684 ​ ​ 113,858 Dilutive effect of Exchangeable Senior Notes ​ ​ 74,260 ​ ​ 103,742 ​ ​ 87,437 ​ ​ 304,348 Diluted ​ 28,257,239 ​ 28,036,690 ​ ​ 28,239,841 ​ ​ 27,159,774 Net income attributable to common stockholders per share: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ $ 1.45 ​ $ 1.42 ​ $ 2.89 ​ $ 2.77 Diluted ​ $ 1.44 ​ $ 1.42 ​ $ 2.87 ​ $ 2.75 ​

Fair Value of Financial Instrum

Fair Value of Financial Instruments	6 Months Ended
	Jun. 30, 2023
Fair Value of Financial Instruments
Fair Value of Financial Instruments	9. Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. Accounting guidance also establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2—Includes other inputs that are directly or indirectly observable in the marketplace. Level 3—Unobservable inputs that are supported by little or no market activities, therefore requiring an entity to develop its own assumptions. The following table presents the carrying value and approximate fair value of financial instruments at June 30, 2023 and December 31, 2022 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At June 30, 2023 ​ At December 31, 2022 ​ ​ ​ ​ ​ ​ Carrying Value Fair Value Carrying Value Fair Value Investments (1) ​ $ 72,726 ​ $ 72,550 ​ $ 200,935 ​ $ 200,715 Exchangeable Senior Notes (2) ​ $ 4,414 ​ $ 5,476 ​ $ 6,380 ​ $ 10,282 Notes due 2026 (2) ​ $ 295,772 ​ $ 253,395 ​ $ 295,115 ​ $ 264,234 Construction Loan (3) ​ $ 20,917 ​ $ 25,350 ​ $ 18,021 ​ $ 20,167 (1) Short-term investments consisting of obligations of the U.S. government with an original maturity at the time of purchase of greater than three months are classified as held-to-maturity and valued using Level 1 inputs. (2) The fair value is determined based upon Level 2 inputs as the Exchangeable Senior Notes and Notes due 2026 were trading in the private market. (3) The construction loan receivable is categorized as Level 3 and was valued using a yield analysis, which is typically performed for non-credit impaired loans. To determine fair value using a yield analysis, a current price is imputed for the loan based upon an assessment of the expected market yield for a similarly structured loan with a similar level of risk. In the yield analysis, the Company considers the current contractual interest rate, the maturity and other terms of the loan relative to risk of the company and the specific loan. At June 30, 2023 and December 31, 2022, the expected market yield used to determine fair value was 25% . Changes in market yields may change the fair value of the construction loan. Generally, an increase in market yields may result in a decrease in the fair value of the construction loan. Due to the inherent uncertainty of determining the fair value of a loan that does not have a readily available market value, the fair value of the construction loan may fluctuate from period to period. Additionally, the fair value of the construction loan may differ significantly from the value that would have been used had a readily available market existed for such loan and may differ materially from the value that the Company may ultimately realize. ​ As of June 30, 2023 and December 31, 2022, cash equivalent instruments consisted of approximately $79.7 million and $78.0 million, respectively, in short-term money market funds that were measured using the net asset value per share that have not been classified using the fair value hierarchy. The fund invests primarily in short-term U.S. Treasury and government securities. Short-term investments consisting of certificate of deposits and obligations of the U.S. government are stated at amortized cost, which approximates their relative fair values due to the short-term maturities and market rates of interest of these instruments. The carrying amounts of financial instruments such as cash equivalents invested in certificates of deposit, obligations of the U.S. government with an original maturity at the time of purchase of less than or equal to three months, accounts payable, accrued expenses and other liabilities approximate their fair values due to the short-term maturities and market rates of interest of these instruments.

Common Stock Incentive Plan

Common Stock Incentive Plan	6 Months Ended
	Jun. 30, 2023
Common Stock Incentive Plan
Common Stock Incentive Plan	10. Common Stock Incentive Plan Our board of directors adopted our 2016 Omnibus Incentive Plan (the “2016 Plan”) to enable us to motivate, attract and retain the services of directors, employees and consultants considered essential to our long-term success. The 2016 Plan offers our directors, employees and consultants an opportunity to own our stock or rights that will reflect our growth, development and financial success. Under the terms of the 2016 Plan, the aggregate number of shares of our common stock subject to options, restricted stock, stock appreciation rights, restricted stock units and other awards, will be no more than 1,000,000 shares. Any equity awards that lapse, expire, terminate, are canceled or are forfeited (including forfeitures in connection with satisfaction of tax withholdings obligations of the recipient) are re-credited to the 2016 Plan’s reserve for future issuance. The 2016 Plan automatically terminates on the date which is ten years following the effective date of the 2016 Plan. A summary of the restricted stock activity under the 2016 Plan and related information for the six months ended June 30, 2023 is included in the table below: ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ ​ Unvested ​ Average ​ ​ Restricted ​ Grant Date Fair ​ ​ Stock ​ Value Balance at December 31, 2022 34,026 ​ $ 181.08 Granted 35,565 ​ $ 110.88 Vested (9,154) ​ $ 187.00 Forfeited (1) (5,596) ​ $ 115.01 Balance at March 31, 2023 54,841 ​ $ 141.31 Granted ​ 5,055 ​ $ 71.23 Vested ​ (2,811) ​ $ 128.11 Balance at June 30, 2023 ​ 57,085 ​ $ 135.75 (1) Shares that were forfeited to cover the employees’ tax withholding obligation upon vesting . The remaining unrecognized compensation cost of approximately $6.1 million for restricted stock awards is expected to be recognized over a weighted-average amortization period of approximately 2.0 years as of June 30, 2023. The fair value of restricted stock that vested during the six months ended June 30, 2023 was approximately $1.7 million. The following table summarizes our RSU activity for the six months ended June 30, 2023. RSUs are issued as part of the Innovative Industrial Properties, Inc. Nonqualified Deferred Compensation Plan (the “Deferred Compensation Plan”), which allows a select group of management and our non-employee directors to defer receiving certain of their cash and equity-based compensation. RSUs are subject to vesting conditions of the Deferred Compensation Plan and have the same economic rights as shares of restricted stock under the 2016 Plan: ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-Average ​ ​ Restricted ​ Grant Date Fair ​ ​ Stock Units ​ Value Balance at December 31, 2022 ​ 83,677 ​ $ 144.30 Granted ​ 61,785 ​ $ 103.60 Balance at March 31, 2023 ​ 145,462 ​ $ 127.01 Granted ​ 4,494 ​ $ 71.23 Balance at June 30, 2023 ​ 149,956 ​ $ 125.34 ​ The remaining unrecognized compensation cost of approximately $8.6 million for RSU awards is expected to be recognized over an amortization period of approximately 2.1 years as of June 30, 2023. In January 2021 and 2022, we issued 70,795 and 102,641 “target” PSUs, respectively, to a select group of officers, which vest and are settled in shares of common stock based on the Company’s total stockholder return over a performance period of approximately three years from the grant date. ​ Stock-based compensation for market-based PSU awards is based on the grant date fair value of the equity awards and is recognized over the applicable Performance Period. For both the three and six months ended June 30, 2023 and 2022, we recognized stock-based compensation expense of approximately $2.7 million and $5.3 million, respectively, relating to PSU awards. As of June 30, 2023, the remaining unrecognized compensation cost of approximately $12.0 million relating to PSU awards is expected to be recognized over the remaining Performance Period of approximately 1.4 years. As measured as of June 30, 2023, the performance thresholds for the vesting of the PSUs were not met for any of the applicable awards.

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2023
Commitments and Contingencies
Commitments and Contingencies	11. Commitments and Contingencies Office Lease ​ ​ ​ ​ ​ Year Amount 2023 (six months ending December 31) ​ $ 249 2024 ​ 511 2025 ​ 526 2026 ​ 543 2027 ​ 45 Total future contractual lease payments ​ 1,874 Effect of discounting ​ (192) Office lease liability ​ $ 1,682 ​ Improvement Allowances Construction Loan. Environmental Matters. Litigation Class Action Lawsuit On April 25, 2022, a federal securities class action lawsuit was filed against the Company and certain of its officers. The case was named Michael V. Malozzi, individually and on behalf of others similarly situated v. Innovative Industrial Properties, Inc., Paul Smithers, Catherine Hastings and Andy Bui, Case No. 2-22-cv-02359, and alleges that we and certain of our officers made false or misleading statements regarding our business in violation of Section 10(b) of the Securities Exchange Act of 1934, as (the “Exchange Act”), SEC Rule 10b-5, and Section 20(a) of the Exchange Act. According to the filed complaint, the p On September 29, 2022, an Amended Class Action complaint was filed under the same Case Number, adding as defendants Alan D. Gold and Benjamin C. Regin, and asserting causes of action under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. According to the Amended Class Action Complaint, the plaintiff is seeking an undetermined amount of damages, interest, attorneys’ fees and costs and other relief on behalf of the putative classes of all persons who acquired shares of the Company’s common stock between August 7, 2020 and August 4, 2022. On December 1, 2022, defendants moved to dismiss the Amended Class Action Complaint; on January 25, 2023, plaintiff responded to defendants’ motion to dismiss the Amended Class Action Complaint; and on March 6, 2023 defendants replied to plaintiff’s response. The court has not issued a ruling. It is possible that similar lawsuits may yet be filed in the same or other courts that name the same or additional defendants. We intend to defend the lawsuit vigorously. However, at this time, we cannot predict the probable outcome of this action, and, accordingly, no amounts have been accrued in the Company’s condensed consolidated financial statements. ​ Derivative Action Lawsuit On July 26, 2022, a derivative action lawsuit was filed against the Company and certain of its officers and directors. The case was named John Rice, derivatively on behalf of Innovative Industrial Properties, Inc. v. Paul Smithers, Catherine Hastings, Andy Bui, Alan Gold, Gary Kreitzer, Mary Curran, Scott Shoemaker, David Stecher, and Innovative Industrial Properties, Inc., The plaintiffs are seeking declaratory relief, direction to reform and improve corporate governance and internal procedures, and an undetermined amount of damages, restitution, interest, and attorneys’ fees and costs. On September 6, 2022, the defendants in this action filed a Consent Motion to Stay the Proceedings, which was granted on October 11, 2022. On September 28, 2022, a second derivative action lawsuit was filed against the Company and certain of its officers and directors. The case was named Karen Drover, derivatively on behalf of Innovative Industrial Properties, Inc. v. Paul Smithers, Catherine Hastings, Andy Bui, Alan Gold, Gary Kreitzer, Mary Curran, Scott Shoemaker, David Stecher, Defendants, and Innovative Industrial Properties Inc., Nominal Defendant Ross Weintraub, derivatively on behalf of Innovative Industrial Properties, Inc. v. Alan Gold, Paul Smithers, Catherine Hastings, Ben Regin, Andy Bui, Tracie Hager, Gary Kreitzer, David Stecher, Scott Shoemaker, Mary Curran, and Innovative Industrial Properties, Inc., Franco DeBlasio, on behalf of Gerich Melenth Nin (GMN) LP, derivatively on behalf of Innovative Industrial Properties, Inc. v. Paul Smithers, Catherine Hastings, Alan D. Gold, Tracie J. Hager, Benjamin C. Regin, Andy Bui, Gary A. Kreitzer, David Stecher, Scott Shoemaker, Mary Curran, and Innovative Industrial Properties, Inc., ​ Kings Garden Lawsuit In July 2022, one of our tenants, Kings Garden Inc., defaulted on its obligations to pay base rent and property management fees under each of its six leases with our indirect, wholly owned subsidiary, IIP-CA 2 LP, and defaulted on its obligations to reimburse us for certain insurance premiums at the properties incurred by us that are payable by Kings Garden as operating expenses under such leases. On July 25, 2022, IIP-CA 2 LP filed a lawsuit against Kings Garden. The case was named IIP-CA 2 LP, a Delaware limited partnership v. Kings Garden Inc., a Nevada corporation, CK Endeavors, Inc., a California corporation, and JM Endeavors, Inc., a California corporation IIP-CA 2 LP, a Delaware limited partnership v. Kings Garden Inc., a Nevada corporation, CK Endeavors, Inc., a California corporation, JM Endeavors, Inc., a California corporation, Michael King, an individual, Gary LaSalle, an individual, Charles Kieley, an individual, and Laurie Kibby, an individual On September 11, 2022, the parties to the lawsuit entered into a confidential, conditional settlement agreement pertaining to matters related to the lawsuit. Pursuant to the conditional settlement agreement, as of June 30, 2023, Out of the amounts included in construction in progress at June 30, 2023, we are in the process of investigating additional costs paid of approximately $9.6 million to determine whether these are potential overpayments. Although there is at least a reasonable possibility that a loss may have been incurred in connection with the default by Kings Garden and the related construction projects, as of June 30, 2023, we are unable to make such an estimate. On February 14, 2023, Kings Garden filed an Arbitration Demand related to the interpretation of the confidential, conditional settlement agreement between the parties that concerns certain terms governing (along with the relevant lease) the assignment of one of the Kings Garden leases. The Company filed a Response to Kings Garden’s Arbitration Demand, Affirmative Defenses and Counter-Claim on March 1, 2023 (the “Counter-Claim”). Kings Garden filed an answer to the Counter-Claim on March 15, 2023. An emergency hearing was conducted on April 13, 2023, pursuant to which the arbitrator denied Kings Garden’s Motion for Interim Relief, and established timeframes and procedures for the arbitration. In July 2023, the Company filed a motion for leave to amend its Counter-Claims. A hearing before the arbitrator is scheduled for August 17, 2023. Parallel Pennsylvania Litigation On February 6, 2023, IIP-PA 8 LLC, as landlord and an indirect subsidiary of the Company, filed a lawsuit against Goodblend Pennsylvania LLC, as tenant, and Parallel, as guarantor, in the Court of Common Pleas of Allegheny County, Pennsylvania, regarding the lease and related guaranty for one of the Company’s properties located in Pennsylvania. The lawsuit asserts claims for breach of contract by the tenant and guarantor and ejectment. Goodblend Pennsylvania LLC and Parallel filed preliminary objections to the lawsuit on March 3, 2023. IIP-PA 8 LLC filed its response to Goodblend Pennsylvania LLC’s and Parallel’s preliminary objections on March 23, 2023. The Court issued an Order on June 13, 2023 denying Goodblend Pennsylvania LLC’s and Parallel’s preliminary objections and directing Goodblend Pennsylvania LLC and Parallel to file an answer to the complaint. On June 9, 2023, IIP-PA 8 LLC filed a Motion for a Trial Date, which is scheduled to be heard on September 6, 2023. Goodblend Pennsylvania LLC and Parallel have filed a joint answer to the complaint requesting that the complaint be dismissed. ​ ​ ​ Parallel Texas Litigation On February 11, 2023, a subsidiary of Parallel defaulted on its obligations to pay rent under the lease at one of our properties in Texas that is under development. On February 23, 2023, IIP-TX 1 LLC, as landlord and an indirect subsidiary of the Company, filed a lawsuit against Surterra San Marcos, LLC, as tenant, in the Justice Court of Hays County, Texas, regarding the lease, asserting claim for possession. On March 9, 2023 a judgment for possession was entered in favor of IIP-TX 1 LLC, as well as monthly rental amounts due. On March 13, 2023, IIP-TX 1 LLC filed a subsequent lawsuit against Surterra San Marcos, LLC, Parallel and Sunstream Opportunities LP (“SAF Entity 1”) in the District Court of Hays County, Texas, regarding the same lease, asserting claims against Surterra San Marcos, LLC, Parallel and SAF Entity 1 for breach of contract, tortious interference with contract, unjust enrichment, fraud and fraudulent inducement, intentional failure to disclose and misrepresentations and conversion, and also requested the granting of a temporary injunction and the appointment of a receiver over the license(s) pertaining to the property’s operations as a regulated cannabis facility. Green Peak Michigan Litigation On February 2, 2023, IIP-MI 1 LLC, as landlord and an indirect subsidiary of the Company, filed a lawsuit against Green Peak Industries, Inc. (“Green Peak”), as tenant, in 56-A District Court of the State of Michigan, regarding the lease for one of the Company’s properties located in Michigan, asserting claim for possession. On February 22, 2023, IIP-MI 1 LLC filed a subsequent lawsuit against Green Peak and Tropics LP (“SAF Entity 2”) in the 56 th We may, from time to time, be a party to other legal proceedings, which arise in the ordinary course of our business. Although the results of these proceedings, claims, inquiries, and investigations cannot be predicted with certainty, we do not believe that the final outcome of these matters is reasonably likely to have a material adverse effect on our business, financial condition, or results of operations. Regardless of final outcomes, however, any such proceedings, claims, inquiries, and investigations may nonetheless impose a significant burden on management and employees and may come with significant defense costs or unfavorable preliminary and interim rulings.

Subsequent Events

Subsequent Events	6 Months Ended
	Jun. 30, 2023
Subsequent Events
Subsequent Events	12. Subsequent Events In July 2023, we amended our lease with a subsidiary of 4Front Ventures Corp. at one of our Illinois properties, pursuant to which, among other things, we agreed to apply a portion of the security deposit that we hold under the lease to pay one-half of the monthly installments of base rent due from the tenant, commencing on August 1, 2023 and continuing through November 30, 2023, which the tenant is then required to repay over a 12-month period commencing on January 1, 2024. ​ ​

Summary of Significant Accoun_2

Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements (Policies)	6 Months Ended
	Jun. 30, 2023
Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements
Basis of Presentation	Basis of Presentation. This interim financial information should be read in conjunction with the audited consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Any references to square footage or occupancy percentage, and any amounts derived from these values in these notes to the condensed consolidated financial statements, are outside the scope of our independent registered public accounting firm’s review. Management believes that all adjustments of a normal, recurring nature considered necessary for a fair presentation have been included. This interim financial information does not necessarily represent or indicate what the operating results will be for the year ending December 31, 2023.
Reclassifications	Reclassification
Federal Income Taxes	Federal Income Taxes.
Use of Estimates	Use of Estimates.
Reportable Segment	Reportable Segment.
Acquisition of Real Estate Properties	Acquisition of Real Estate Properties. The fair value of acquired in-place leases is derived based on our assessment of estimated lost revenue and costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased. The amounts recorded for acquired in-place leases are reflected as in-place lease intangible assets, net on our condensed consolidated balance sheets and are amortized on a straight-line basis as a component of depreciation and amortization expense over the remaining term of the applicable leases. The fair value of the above-market component of an acquired in-place operating lease is based upon the present value (calculated using a market discount rate) of the difference between (i) the contractual rents to be paid pursuant to the lease over its remaining non-cancellable lease term and (ii) our estimate of the rents that would be paid using fair market rental rates and rent escalations at the date of acquisition measured over the remaining non-cancellable term of the lease. The amount recorded for one above-market operating lease is included in other assets, net on our condensed consolidated balance sheets and is amortized on a straight-line basis as a reduction of rental revenues over the remaining term of the applicable lease.
Sale of Real Estate	Sale of Real Estate. Gains and Losses from the Derecognition of Nonfinancial Assets Revenue from Contracts with Customers (Topic 606)
Cost Capitalization and Depreciation	Cost Capitalization and Depreciation. Amounts capitalized are depreciated over estimated useful lives determined by management. We depreciate buildings and improvements based on our evaluation of the estimated useful life of each specific asset, not to exceed 40 years. For the three months ended June 30, 2023 and 2022, we recognized depreciation expense of approximately $16.5 million and $15.0 million, respectively, and for the six months ended June 30, 2023 and 2022, we recognized depreciation expense of approximately $33.0 million and $28.7 million, respectively. Depreciation expense relating to our real estate held for investment is included in depreciation and amortization expense in our condensed consolidated statements of income. We depreciate office equipment and furniture and fixtures over estimated useful lives ranging from three Determining whether expenditures meet the criteria for capitalization and the assignment of depreciable lives requires management to exercise significant judgment. Project costs that are clearly associated with the acquisition and development or redevelopment of a real estate project, for which we are the accounting owner, are capitalized as a cost of that project. Expenditures that meet one or more of the following criteria generally qualify for capitalization: ● the expenditure provides benefit in future periods; and ● the expenditure extends the useful life of the asset beyond our original estimates. We define redevelopment properties as existing properties for which we expect to spend significant development and construction costs that are not reimbursements to tenants for improvements at the properties. When existing properties are determined to be redevelopment properties, the net carrying value of the buildings and improvements are transferred to construction in progress while the redevelopment activities are in process. During the six months ended June 30, 2023, we reclassified the net carrying value of the buildings and improvements totaling approximately $51.2 million to construction in progress relating to an existing property that was placed into redevelopment. Costs capitalized to construction in progress related to redevelopment properties are transferred to buildings and improvements at historical cost of the properties as the redevelopment project or phases of projects are placed in service.
Provision for Impairment	Provision for Impairment. Long-lived assets are individually evaluated for impairment when conditions exist that may indicate that the carrying amount of a long-lived asset may not be recoverable. The carrying amount of a long-lived asset to be held and used is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Impairment indicators or triggering events for long-lived assets to be held and used are assessed by project and include significant fluctuations in estimated net operating income, occupancy changes, significant near-term lease expirations, current and historical operating and/or cash flow losses, construction costs, estimated completion dates, rental rates, and other market factors. We assess the expected undiscounted cash flows based upon numerous factors, including, but not limited to, construction costs, available market information, current and historical operating results, known trends, current market/economic conditions that may affect the property, and our assumptions about the use of the asset, including, if necessary, a probability-weighted approach if multiple outcomes are under consideration. Upon determination that an impairment has occurred, a write-down is recognized to reduce the carrying amount to its estimated fair value. We may adjust depreciation of properties that are expected to be disposed of or redeveloped prior to the end of their useful lives. No impairment losses were recognized during the six months ended June 30, 2023 and 2022.
Revenue Recognition	Revenue Recognition. For the three months ended June 30, 2023, rental revenue recognized included the application of approximately $1.5 million of security deposits for rent with two tenants in connection with lease amendments. For the six months ended June 30, 2023, rental revenue recognized included the application of approximately $3.1 million of security deposits applied for rent with two tenants who were in default under their respective lease agreements and approximately $2.7 million of security deposits for rent with two tenants in connection with lease amendments.
Construction Loan	Construction Loan. In February 2023, we amended the construction loan to provide for, among other things: (1) the additional capital commitment of the borrower into the project of $1.0 million; (2) our agreement to fund an additional $4.5 million into the project; (3) an increase in the interest rate effective April 1, 2023; (4) an extension of the loan term to December 31, 2023; and (5) the provision of additional collateral from the borrower for the loan. Interest on the loan continued to accrue through March 31, 2023, with monthly payment of interest having commenced April 1, 2023.
Cash and Cash Equivalents	Cash and Cash Equivalents
Restricted Cash	Restricted Cash
Investments	Investments.
Exchangeable Notes	Exchangeable Notes. In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 simplifies the accounting for convertible debt by eliminating the beneficial conversion and cash conversion accounting models, and convertible debt proceeds, unless issued with a substantial premium or an embedded conversion feature, will no longer be allocated between debt and equity components. ASU 2020-06 also updates the earnings per share calculation and requires entities to assume share settlement when the convertible debt can be settled in cash or shares. We adopted ASU 2020-06 on January 1, 2022 and recognized a cumulative-effect adjustment of approximately $728,000 to the opening balance of retained earnings and derecognized approximately $1.3 million of the remaining equity component relating to the outstanding principal balance of our Exchangeable Senior Notes at the date of adoption.
Deferred Financing Costs	Deferred Financing Costs.
Stock-Based Compensation	Stock-Based Compensation.
Lease Accounting	Lease Accounting. existing lease space and measured the lease liability to the expansion space based on the present value of the respective future lease payments (excluding the extension option that we are not reasonably certain to exercise), discounted using the estimated incremental borrowing rate of 5.5%, which was the interest rate at that time that we estimate we would have had to pay to borrow on a collateralized basis over a similar term for an amount equal to the lease payments. Subsequently, the lease liability is accreted by applying a discount rate established at the lease commencement date to the lease liability balance as of the beginning of the period and is reduced by the payments made during the period. The right-of-use asset is measured based on the corresponding lease liability. We did not incur any initial direct leasing costs or exchange any other consideration with the landlord prior to the commencement of the lease. Subsequently, the right-of-use asset is amortized on a straight-line basis during the lease term. For both the three months ended June 30, 2023 and 2022, we recognized office lease expense of approximately $122,000, and for the six months ended June 30, 2023 and 2022, we recognized office lease expense of approximately $243,000 and $223,000, respectively, which are included in general and administrative expenses in our condensed consolidated statements of income. For the six months ended June 30, 2023 and 2022, amounts paid and classified as operating activities in our condensed consolidated statements of cash flows for the office lease were approximately $248,000 and $161,000, respectively. As lessor, for each of our real estate transactions involving the leaseback of the related property to the seller or affiliates of the seller, we determine whether these transactions qualify as sale and leaseback transactions under the accounting guidance. For these transactions, we consider various inputs and assumptions including, but not necessarily limited to, lease terms, renewal options, discount rates, and other rights and provisions in the purchase and sale agreement, lease and other documentation to determine whether control has been transferred to the Company or remains with the lessee. A transaction involving a sale leaseback will be treated as a purchase of a real estate property if it is considered to transfer control of the underlying asset from the lessee. A lease will be classified as direct-financing if risks and rewards are conveyed without the transfer of control and will be classified as a sales-type lease if control of the underlying asset is transferred to the lessee. Otherwise, the lease is treated as an operating lease. These criteria also include estimates and assumptions regarding the fair value of the leased facilities, minimum lease payments, the economic useful life of the facilities, the existence of a purchase option, and certain other terms in the lease agreements. The lease accounting guidance requires accounting for a transaction as a financing in a sale leaseback when the seller-lessee is provided an option to purchase the property from the landlord at the tenant’s option. Substantially all of our leases continue to be classified as operating leases and we continue to record revenue for each of our properties on a cash basis. Our tenant reimbursable revenue and property expenses continue to be presented on a gross basis as rental revenues and as property expenses, respectively, on our condensed consolidated statements of income. Property taxes paid directly by the lessee to a third party continue to be excluded from our condensed consolidated financial statements. Lease amendments are evaluated to determine if the modification grants the lessee an additional right-of-use not included in the original lease and if the lease payments increase commensurate with the standalone price of the additional right-of-use, adjusted for the circumstances of the particular contract. If both conditions are present, the lease amendment is accounted for as a new lease that is separate from the original lease. Our leases generally contain options to extend the lease terms at the prevailing market rate or at the expiring rental rate at the time of expiration. Certain of our leases provide the lessee with a right of first refusal or right of first offer in the event we market the leased property for sale.
Concentration of Credit Risk	Concentration of Credit Risk The following table sets forth the five tenants in our portfolio that represented the largest percentage of our total rental revenues for the three and six months ended June 30, 2023 and 2022, including tenant reimbursements: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended ​ ​ June 30, 2023 ​ ​ ​ ​ ​ Percentage of ​ ​ Number of Rental ​ Leases Revenue ​ PharmaCann Inc. ("PharmaCann") 11 ​ 15 % Ascend Wellness Holdings, Inc. ("Ascend") ​ 4 ​ 10 % Green Thumb Industries, Inc. ("GTI") 3 ​ 8 % Curaleaf Holdings, Inc. ("Curaleaf") ​ 8 ​ 7 % Trulieve Cannabis Corp. ("Trulieve") 6 ​ 7 % ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Six Months Ended ​ ​ June 30, 2023 ​ ​ ​ ​ ​ Percentage of ​ ​ Number of Rental ​ Leases Revenue ​ PharmaCann 11 ​ 15 % Ascend ​ 4 ​ 10 % GTI 3 ​ 7 % SH Parent, Inc. ("Parallel") (1) ​ 4 ​ 7 % Curaleaf 8 ​ 7 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended ​ For the Six Months Ended ​ ​ June 30, 2022 ​ June 30, 2022 ​ ​ ​ ​ ​ Percentage of ​ ​ ​ Percentage of ​ ​ Number of Rental Number of Rental ​ Leases Revenue Leases Revenue ​ PharmaCann 11 ​ 13 % 11 ​ 14 % Parallel ​ 4 ​ 10 % 4 ​ 10 % Ascend 4 ​ 10 % 4 ​ 9 % Kings Garden Inc. ("Kings Garden") (2) ​ 6 ​ 8 % 6 ​ 8 % Trulieve 6 ​ 6 % 6 ​ 7 % (1) Commencing in November 2022, Parallel defaulted on its obligations to pay rent at one of our Pennsylvania properties . In February 2023, Parallel defaulted on its obligations to pay rent at one of our Texas properties, and we regained possession of that property in March 2023. See Note 11 “Commitments and Contingencies — Litigation” to our condensed consolidated financial statements for more information. Excluding security deposits applied for payment of rent for Parallel at one property in Pennsylvania and one property in Texas of approximately $1.8 million and $395,000 , respectively, Parallel would have represented 6% of our total rental revenues for the six months ended June 30, 2023. (2) In July 2022, Kings Garden defaulted on its obligations to pay rent at all of the properties it leases with us, and pursuant to a confidential, conditional settlement agreement executed on September 11, 2022 between us and Kings Garden, we terminated the leases for two properties that were in development or redevelopment as of June 30, 2023 and regained possession of those properties. See Note 11 “Commitments and Contingencies — Litigation” to our condensed consolidated financial statements for more information. In each of the tables above, these leases include leases with affiliates of each entity, for which the entity has provided a corporate guaranty. As of June 30, 2023, our largest property was located in New York and accounted for approximately 5.4% of our net real estate held for investment. No other properties accounted for more than 5% of our net real estate held for investment as of June 30, 2023. As of December 31, 2022, none of our properties individually represented more than 5% of our net real estate held for investment. We have deposited cash with financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. As of June 30, 2023, we had cash accounts in excess of FDIC insured limits. We have not experienced any losses in such accounts.

Summary of Significant Accoun_3

Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements (Tables)	6 Months Ended
	Jun. 30, 2023
Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements
Schedule of tenants in the company's portfolio that represented the largest percentage of total rental revenue for each period presented, including tenant reimbursements	The following table sets forth the five tenants in our portfolio that represented the largest percentage of our total rental revenues for the three and six months ended June 30, 2023 and 2022, including tenant reimbursements: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended ​ ​ June 30, 2023 ​ ​ ​ ​ ​ Percentage of ​ ​ Number of Rental ​ Leases Revenue ​ PharmaCann Inc. ("PharmaCann") 11 ​ 15 % Ascend Wellness Holdings, Inc. ("Ascend") ​ 4 ​ 10 % Green Thumb Industries, Inc. ("GTI") 3 ​ 8 % Curaleaf Holdings, Inc. ("Curaleaf") ​ 8 ​ 7 % Trulieve Cannabis Corp. ("Trulieve") 6 ​ 7 % ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Six Months Ended ​ ​ June 30, 2023 ​ ​ ​ ​ ​ Percentage of ​ ​ Number of Rental ​ Leases Revenue ​ PharmaCann 11 ​ 15 % Ascend ​ 4 ​ 10 % GTI 3 ​ 7 % SH Parent, Inc. ("Parallel") (1) ​ 4 ​ 7 % Curaleaf 8 ​ 7 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended ​ For the Six Months Ended ​ ​ June 30, 2022 ​ June 30, 2022 ​ ​ ​ ​ ​ Percentage of ​ ​ ​ Percentage of ​ ​ Number of Rental Number of Rental ​ Leases Revenue Leases Revenue ​ PharmaCann 11 ​ 13 % 11 ​ 14 % Parallel ​ 4 ​ 10 % 4 ​ 10 % Ascend 4 ​ 10 % 4 ​ 9 % Kings Garden Inc. ("Kings Garden") (2) ​ 6 ​ 8 % 6 ​ 8 % Trulieve 6 ​ 6 % 6 ​ 7 % (1) Commencing in November 2022, Parallel defaulted on its obligations to pay rent at one of our Pennsylvania properties . In February 2023, Parallel defaulted on its obligations to pay rent at one of our Texas properties, and we regained possession of that property in March 2023. See Note 11 “Commitments and Contingencies — Litigation” to our condensed consolidated financial statements for more information. Excluding security deposits applied for payment of rent for Parallel at one property in Pennsylvania and one property in Texas of approximately $1.8 million and $395,000 , respectively, Parallel would have represented 6% of our total rental revenues for the six months ended June 30, 2023. (2) In July 2022, Kings Garden defaulted on its obligations to pay rent at all of the properties it leases with us, and pursuant to a confidential, conditional settlement agreement executed on September 11, 2022 between us and Kings Garden, we terminated the leases for two properties that were in development or redevelopment as of June 30, 2023 and regained possession of those properties. See Note 11 “Commitments and Contingencies — Litigation” to our condensed consolidated financial statements for more information. In each of the tables above, these leases include leases with affiliates of each entity, for which the entity has provided a corporate guaranty.

Dividends (Tables)

Dividends (Tables)	6 Months Ended
	Jun. 30, 2023
Dividends
Schedule of dividends declared	The following table describes the dividends declared by the Company during the six months ended June 30, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amount ​ Dividend Dividend Declaration Date ​ Security Class ​ Per Share ​ Period Covered ​ Paid Date ​ Amount ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In thousands) March 15, 2023 ​ Common stock ​ $ 1.80 ​ January 1, 2023 to March 31, 2023 ​ April 14, 2023 ​ $ 50,725 March 15, 2023 ​ Series A preferred stock ​ $ 0.5625 ​ January 15, 2023 to April 14, 2023 ​ April 14, 2023 ​ $ 338 June 15, 2023 ​ Common stock ​ $ 1.80 ​ April 1, 2023 to June 30, 2023 ​ July 14, 2023 ​ $ 50,742 June 15, 2023 ​ Series A preferred stock ​ $ 0.5625 ​ April 15, 2023 to July 14, 2023 ​ July 14, 2023 ​ $ 338

Investments in Real Estate (Tab

Investments in Real Estate (Tables)	6 Months Ended
	Jun. 30, 2023
Schedule of real estate properties	The Company acquired the following properties during the six months ended June 30, 2023 (dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Rentable ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Square ​ Purchase ​ Transaction ​ ​ ​ ​ Property Market Closing Date Feet (1) Price Costs Total ​ Susquehanna Street Pennsylvania ​ ​ February 15, 2023 ​ 58,000 ​ $ 15,000 ​ $ 26 ​ $ 15,026 ​ Boltonfield Street Ohio ​ ​ March 3, 2023 ​ 157,000 ​ 20,100 ​ 29 ​ 20,129 (2) Total ​ ​ ​ ​ ​ ​ 215,000 ​ $ 35,100 ​ $ 55 ​ $ 35,155 (3) ​ (1) Includes expected rentable square feet at completion of construction of certain properties. (2) The tenant is expected to complete improvements at the property, for which we agreed to provide funding of up to $21.9 million. (3) Approximately $2.6 million was allocated to land and approximately $32.6 million was allocated to building and improvements. ​
Schedule of future contractual minimum rent	Future contractual minimum rent (including base rent and property management fees) under the operating leases as of June 30, 2023 for future periods is summarized as follows (in thousands): ​ ​ ​ ​ ​ Year Contractual Minimum Rent 2023 (six months ending December 31) ​ $ 143,487 2024 ​ ​ 296,831 2025 ​ 305,564 2026 ​ 314,623 2027 ​ 323,953 Thereafter ​ 4,167,236 Total ​ $ 5,551,694
Acquired In-Place Lease Intangible Assets
Schedule of intangible assets and related accumulated amortization	In-place lease intangible assets and related accumulated amortization as of June 30, 2023 and December 31, 2022 is as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2023 December 31, 2022 In-place lease intangible assets ​ $ 9,979 ​ $ 9,979 Accumulated amortization (1,304) ​ (874) In-place lease intangible assets, net ​ $ 8,675 ​ $ 9,105
Schedule of estimated annual amortization	​ ​ ​ ​ ​ Year Amount 2023 (six months ending December 31) ​ $ 430 2024 ​ 860 2025 ​ 860 2026 ​ 860 2027 ​ 860 Thereafter ​ 4,805 Total ​ $ 8,675
Above-Market Lease
Schedule of intangible assets and related accumulated amortization	The above-market lease and related accumulated amortization included in other assets, net on our condensed consolidated balance sheets as of June 30, 2023 and December 31, 2022 is as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2023 December 31, 2022 Above-market lease ​ $ 1,054 ​ $ 1,054 Accumulated amortization (141) ​ (95) Above-market lease, net ​ $ 913 ​ $ 959

Debt (Tables)

Debt (Tables)	6 Months Ended
	Jun. 30, 2023
Summary of principal payments on outstanding indebtedness	The following table summarizes the principal payments on our outstanding indebtedness as of June 30, 2023 (in thousands): ​ ​ ​ ​ Payments Due ​ ​ by Year Amount 2023 (six months ending December 31) ​ $ — 2024 ​ ​ 4,436 2025 ​ ​ — 2026 ​ ​ 300,000 2027 ​ ​ — Thereafter ​ ​ — Total ​ $ 304,436
Exchangeable Senior Notes
Schedule of interest expense	The following table details our interest expense related to the Exchangeable Senior Notes (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended June 30, ​ For the Six Months Ended June 30, ​ 2023 2022 2023 2022 Cash coupon $ 42 $ 55 $ 99 $ 331 Amortization of issuance cost ​ 8 ​ 13 ​ 20 ​ 71 Total interest expense $ 50 $ 68 $ 119 $ 402
Schedule of carrying value	The following table details the carrying value of our Exchangeable Senior Notes (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2023 December 31, 2022 Principal amount $ 4,436 $ 6,436 Unamortized issuance cost (22) ​ (56) Carrying value $ 4,414 $ 6,380
Notes due 2026
Schedule of interest expense	The following table details our interest expense related to the Notes due 2026 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended June 30, ​ For the Six Months Ended June 30, ​ 2023 ​ 2022 2023 ​ 2022 Cash coupon ​ $ 4,125 ​ $ 4,125 ​ $ 8,250 ​ $ 8,250 Amortization of issuance cost ​ 331 ​ ​ 311 ​ ​ 657 ​ ​ 618 Capitalized interest ​ (34) ​ ​ — ​ ​ (34) ​ ​ — Total interest expense ​ $ 4,422 ​ $ 4,436 ​ $ 8,873 ​ $ 8,868
Schedule of carrying value	The following table details the carrying value of our Notes due 2026 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2023 December 31, 2022 Principal amount $ 300,000 $ 300,000 Unamortized issuance cost (4,228) ​ (4,885) Carrying value $ 295,772 $ 295,115

Net Income Per Share (Tables)

Net Income Per Share (Tables)	6 Months Ended
	Jun. 30, 2023
Net Income Per Share
Schedule of earnings per share, basic and diluted	Computations of net income per basic and diluted share (in thousands, except share and per share data) were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Three Months Ended ​ For the Six Months Ended ​ ​ June 30, ​ June 30, ​ 2023 2022 2023 2022 Net income ​ $ 41,269 ​ $ 40,214 ​ $ 82,361 ​ $ 75,264 Preferred stock dividends ​ (338) ​ (338) ​ ​ (676) ​ ​ (676) Distribution to participating securities ​ (373) ​ (207) ​ ​ (734) ​ ​ (409) Net income attributable to common stockholders used to compute net income per share – basic ​ ​ 40,558 ​ ​ 39,669 ​ ​ 80,951 ​ ​ 74,179 Dilutive effect of Exchangeable Senior Notes ​ ​ 50 ​ ​ 68 ​ ​ 119 ​ ​ 402 Net income attributable to common stockholders used to compute net income per share – diluted ​ $ 40,608 ​ $ 39,737 ​ $ 81,070 ​ $ 74,581 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average common shares outstanding: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ 27,981,517 ​ 27,850,561 ​ ​ 27,965,720 ​ ​ 26,741,568 Restricted stock and RSUs ​ ​ 201,462 ​ ​ 82,387 ​ ​ 186,684 ​ ​ 113,858 Dilutive effect of Exchangeable Senior Notes ​ ​ 74,260 ​ ​ 103,742 ​ ​ 87,437 ​ ​ 304,348 Diluted ​ 28,257,239 ​ 28,036,690 ​ ​ 28,239,841 ​ ​ 27,159,774 Net income attributable to common stockholders per share: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ $ 1.45 ​ $ 1.42 ​ $ 2.89 ​ $ 2.77 Diluted ​ $ 1.44 ​ $ 1.42 ​ $ 2.87 ​ $ 2.75

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Tables)	6 Months Ended
	Jun. 30, 2023
Fair Value of Financial Instruments
Schedule of condensed financial statements	The following table presents the carrying value and approximate fair value of financial instruments at June 30, 2023 and December 31, 2022 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At June 30, 2023 ​ At December 31, 2022 ​ ​ ​ ​ ​ ​ Carrying Value Fair Value Carrying Value Fair Value Investments (1) ​ $ 72,726 ​ $ 72,550 ​ $ 200,935 ​ $ 200,715 Exchangeable Senior Notes (2) ​ $ 4,414 ​ $ 5,476 ​ $ 6,380 ​ $ 10,282 Notes due 2026 (2) ​ $ 295,772 ​ $ 253,395 ​ $ 295,115 ​ $ 264,234 Construction Loan (3) ​ $ 20,917 ​ $ 25,350 ​ $ 18,021 ​ $ 20,167 (1) Short-term investments consisting of obligations of the U.S. government with an original maturity at the time of purchase of greater than three months are classified as held-to-maturity and valued using Level 1 inputs. (2) The fair value is determined based upon Level 2 inputs as the Exchangeable Senior Notes and Notes due 2026 were trading in the private market. (3) The construction loan receivable is categorized as Level 3 and was valued using a yield analysis, which is typically performed for non-credit impaired loans. To determine fair value using a yield analysis, a current price is imputed for the loan based upon an assessment of the expected market yield for a similarly structured loan with a similar level of risk. In the yield analysis, the Company considers the current contractual interest rate, the maturity and other terms of the loan relative to risk of the company and the specific loan. At June 30, 2023 and December 31, 2022, the expected market yield used to determine fair value was 25% . Changes in market yields may change the fair value of the construction loan. Generally, an increase in market yields may result in a decrease in the fair value of the construction loan. Due to the inherent uncertainty of determining the fair value of a loan that does not have a readily available market value, the fair value of the construction loan may fluctuate from period to period. Additionally, the fair value of the construction loan may differ significantly from the value that would have been used had a readily available market existed for such loan and may differ materially from the value that the Company may ultimately realize.

Common Stock Incentive Plan (Ta

Common Stock Incentive Plan (Tables)	6 Months Ended
	Jun. 30, 2023
Restricted Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Summary of the activity	A summary of the restricted stock activity under the 2016 Plan and related information for the six months ended June 30, 2023 is included in the table below: ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ ​ Unvested ​ Average ​ ​ Restricted ​ Grant Date Fair ​ ​ Stock ​ Value Balance at December 31, 2022 34,026 ​ $ 181.08 Granted 35,565 ​ $ 110.88 Vested (9,154) ​ $ 187.00 Forfeited (1) (5,596) ​ $ 115.01 Balance at March 31, 2023 54,841 ​ $ 141.31 Granted ​ 5,055 ​ $ 71.23 Vested ​ (2,811) ​ $ 128.11 Balance at June 30, 2023 ​ 57,085 ​ $ 135.75 (1) Shares that were forfeited to cover the employees’ tax withholding obligation upon vesting .
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Summary of the activity	The following table summarizes our RSU activity for the six months ended June 30, 2023. RSUs are issued as part of the Innovative Industrial Properties, Inc. Nonqualified Deferred Compensation Plan (the “Deferred Compensation Plan”), which allows a select group of management and our non-employee directors to defer receiving certain of their cash and equity-based compensation. RSUs are subject to vesting conditions of the Deferred Compensation Plan and have the same economic rights as shares of restricted stock under the 2016 Plan: ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-Average ​ ​ Restricted ​ Grant Date Fair ​ ​ Stock Units ​ Value Balance at December 31, 2022 ​ 83,677 ​ $ 144.30 Granted ​ 61,785 ​ $ 103.60 Balance at March 31, 2023 ​ 145,462 ​ $ 127.01 Granted ​ 4,494 ​ $ 71.23 Balance at June 30, 2023 ​ 149,956 ​ $ 125.34 ​

Commitments and Contingencies (

Commitments and Contingencies (Tables)	6 Months Ended
	Jun. 30, 2023
Commitments and Contingencies
Schedule of future contractual lease payments	Office Lease ​ ​ ​ ​ ​ Year Amount 2023 (six months ending December 31) ​ $ 249 2024 ​ 511 2025 ​ 526 2026 ​ 543 2027 ​ 45 Total future contractual lease payments ​ 1,874 Effect of discounting ​ (192) Office lease liability ​ $ 1,682

Organization (Details)

Organization (Details)	Jun. 30, 2023
Iip Operating Partnership Lp
Percentage Leased	100%

Summary of Significant Accoun_4

Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements - Additional Information (Details)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($) segment	Jun. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)	Feb. 28, 2023 USD ($)	Dec. 31, 2021 USD ($)	Nov. 30, 2021	Jun. 30, 2021 USD ($)	Dec. 31, 2018
Tenant improvements					$ 705,300,000
Number of Reportable Segments | segment			1
Depreciation expense	$ 16,500,000	$ 15,000,000	$ 33,000,000	$ 28,700,000
Total investment in property	2,172,010,000		2,172,010,000		2,066,282,000
Impairment loss			0	0
Rental revenue recognized from security deposits applied for rent with tenants in default			3,100,000
Rental revenue recognized from security deposits applied for rent with tenants with lease amendments	1,500,000			2,700,000
Maximum construction loan agreed to lend									$ 18,500,000
Construction loan funded	20,917,000		20,917,000		18,021,000
Construction loan, total commitment amount	23,000,000		23,000,000
Cash equivalents	79,700,000		$ 79,700,000		$ 78,000,000
Lease, Practical Expedients, Package [true false]			true
Incremental borrowing rate								5.50%		7.25%
Amounts paid and classified as operating activities for the office lease			$ 248,000	161,000
Cannabis cultivation and processing facility, California
Additional capital commitment						$ 1,000,000
Additional amount of construction loan						$ 4,500,000
Adjustment | Accounting Standards Update 2020-06
Accumulated deficit							$ 728,000
Equity Components							$ 1,300,000
Geographic Concentration Risk | Net real estate held for investment
Concentration Risk, Threshold Percentage			5%		5%
Geographic Concentration Risk | Net real estate held for investment | New York
Concentration Risk, Threshold Percentage			5.40%
General and administrative expense
Office lease expense	122,000	$ 122,000	$ 243,000	$ 223,000
Maximum
Cash, FDIC Insured Amount	$ 250,000		$ 250,000
Building and Improvements
Property, Plant and Equipment, Useful Life	40 years		40 years
Office equipment and furniture and fixtures | Minimum
Property, Plant and Equipment, Useful Life	3 years		3 years
Office equipment and furniture and fixtures | Maximum
Property, Plant and Equipment, Useful Life	7 years		7 years
Construction in Progress [Member] | Kings Garden Lawsuit | Kings Garden. | Adjustment
Total investment in property	$ 51,200,000		$ 51,200,000

Summary of Significant Accoun_5

Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements - Concentration of Credit Risk (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2023 lease property tenant	Jun. 30, 2022 tenant lease	Jun. 30, 2023 USD ($) tenant property item lease	Jun. 30, 2022 tenant lease	Dec. 31, 2022 property
Concentration Risk [Line Items]
Number of Properties | property	108		108
Number of states in which properties are owned | item			19
Number of tenants | tenant	30		30
Number of properties lease terminated | property	2		2		2
SH Parent, Inc. ("Parallel") | Pennsylvania | Parallel Pennsylvania Litigation
Concentration Risk [Line Items]
Number of Properties | property	1		1
Rental revenue recognized from security deposits applied for rent | $			$ 1,800,000
SH Parent, Inc. ("Parallel") | Texas | Parallel Texas Litigation
Concentration Risk [Line Items]
Number of Properties | property	1		1
Rental revenue recognized from security deposits applied for rent | $			$ 395,000
Rental revenues (including tenant reimbursements) | Customer concentration
Concentration Risk [Line Items]
Number of tenants | tenant	5	5	5	5
Rental revenues (including tenant reimbursements) | Customer concentration | PharmaCann Inc.
Concentration Risk [Line Items]
Number of Leases	11	11	11	11
Percentage of Rental Revenue	15%	13%	15%	14%
Rental revenues (including tenant reimbursements) | Customer concentration | Ascend Wellness Holdings, Inc.
Concentration Risk [Line Items]
Number of Leases	4	4	4	4
Percentage of Rental Revenue	10%	10%	10%	9%
Rental revenues (including tenant reimbursements) | Customer concentration | Green Thumb Industries, Inc.
Concentration Risk [Line Items]
Number of Leases	3		3
Percentage of Rental Revenue	8%		7%
Rental revenues (including tenant reimbursements) | Customer concentration | SH Parent, Inc. ("Parallel")
Concentration Risk [Line Items]
Number of Leases		4	4	4
Percentage of Rental Revenue		10%	7%	10%
Rental revenues (including tenant reimbursements) | Customer concentration | SH Parent, Inc. ("Parallel") | Parallel Pennsylvania Litigation
Concentration Risk [Line Items]
Percentage of Rental Revenue			6%
Rental revenues (including tenant reimbursements) | Customer concentration | Curaleaf Holdings, Inc.
Concentration Risk [Line Items]
Number of Leases	8		8
Percentage of Rental Revenue	7%		7%
Rental revenues (including tenant reimbursements) | Customer concentration | Kings Garden Inc.
Concentration Risk [Line Items]
Number of Leases		6		6
Percentage of Rental Revenue		8%		8%
Rental revenues (including tenant reimbursements) | Customer concentration | Trulieve
Concentration Risk [Line Items]
Number of Leases	6	6		6
Percentage of Rental Revenue	7%	6%		7%

Common Stock (Details)

Common Stock (Details) $ / shares in Units, $ in Millions	1 Months Ended	6 Months Ended
	Jan. 31, 2023 item shares	Jun. 30, 2023 USD ($) $ / shares shares	Dec. 31, 2022 $ / shares shares
Common Stock, Shares Authorized		50,000,000	50,000,000
Common Stock, Par Value (in dollars per share) | $ / shares		$ 0.001	$ 0.001
Common Stock, Shares Outstanding		28,040,054	27,972,830
Common Stock, Shares Issued		28,040,054	27,972,830
Number of shares issued upon conversion		32,200
Outstanding principal amount | $		$ 2
At The Market Offerings
Number of shares issued		0
Number of sales agents | item	4
At The Market Offerings | Maximum
Maximum number of common stock issuable	500,000,000

Preferred Stock (Details)

Preferred Stock (Details) - $ / shares	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Preferred Stock, Shares Authorized	50,000,000	50,000,000
Preferred Stock, Par or Stated Value Per Share	$ 0.001	$ 0.001
Preferred Stock, Shares Outstanding	28,040,054
Series A Preferred Stock
Preferred Stock, Par or Stated Value Per Share	$ 0.001
Preferred Stock, Shares Issued	600,000	600,000
Preferred Stock, Shares Outstanding	600,000	600,000
Preferred Stock, Dividend Rate, Percentage	9%	9%
Preferred Stock, Redemption Price Per Share	$ 25
Preferred Stock, Voting Rights	Holders of the Series A Preferred Stock generally have no voting rights except for limited voting rights if the Company fails to pay dividends for six or more quarterly periods (whether or not consecutive) and in certain other circumstances.

Dividends (Details)

Dividends (Details) - USD ($) $ / shares in Units, $ in Thousands					6 Months Ended
	Jul. 14, 2023	Jun. 15, 2023	Apr. 14, 2023	Mar. 15, 2023	Jun. 30, 2023	Jun. 30, 2022
Dividends declared per common share		$ 1.80		$ 1.80
Dividends declared per Series A preferred stock		$ 0.5625		$ 0.5625
Dividend amount - Common stock			$ 50,725		$ 101,227	$ 84,339
Dividend amount - Series A preferred stock			$ 338		$ 676	$ 676
Subsequent event
Dividend amount - Common stock	$ 50,742
Dividend amount - Series A preferred stock	$ 338

Investments in Real Estate (Det

Investments in Real Estate (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($) ft²
Rentable Square Feet | ft²	215,000
Initial Purchase Price	$ 35,100
Transaction Costs	55
Total	35,155
Land
Total	2,600
Building and Improvements
Total	$ 32,600
Susquehanna Street
Rentable Square Feet | ft²	58,000
Initial Purchase Price	$ 15,000
Transaction Costs	26
Total	$ 15,026
Boltonfield Street
Rentable Square Feet | ft²	157,000
Initial Purchase Price	$ 20,100
Transaction Costs	29
Total	20,129
Agreed funding for redevelopment of building	$ 21,900

Investments in Real Estate - In

Investments in Real Estate - Intangible assets and related accumulated amortization (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Acquired In-Place Lease Intangible Assets
Finite-Lived Intangible Assets [Line Items]
Gross	$ 9,979	$ 9,979
Accumulated amortization	(1,304)	(874)
Total	8,675	9,105
Above-Market Lease
Finite-Lived Intangible Assets [Line Items]
Gross	1,054	1,054
Accumulated amortization	(141)	(95)
Total	$ 913	$ 959

Investments in Real Estate - Es

Investments in Real Estate - Estimated annual amortization (Details) - Acquired In-Place Lease Intangible Assets - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
2023 (six months ending December 31)	$ 430
2024	860
2025	860
2026	860
2027	860
Thereafter	4,805
Total	$ 8,675	$ 9,105

Investments in Real Estate - Ad

Investments in Real Estate - Additional Information (Details)	1 Months Ended			3 Months Ended			6 Months Ended
	Mar. 31, 2023 USD ($) property	Feb. 28, 2023 USD ($)	Jan. 31, 2023	Jun. 30, 2023 USD ($)	Mar. 31, 2023 USD ($) item	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Purchase Price				$ 35,100,000			$ 35,100,000
Real estate property cost				101,800,000			101,800,000
Tenant improvements and construction activities funded				111,500,000			111,500,000
Interest payments				537,000			537,000
Acquired In-Place Lease Intangible Assets
Initial value				8,675,000			8,675,000		$ 9,105,000
Amortization expense				215,000		$ 213,000	$ 430,000	$ 411,000
Weighted-average amortization period (in years)							10 years
Above-Market Lease
Initial value				$ 913,000			$ 913,000		$ 959,000
Amortization period (in years)				9 years 9 months 18 days			9 years 9 months 18 days
Amortization expense				$ 23,000		$ 23,000	$ 46,000	$ 46,000
Holistic | California, Maryland, Massachusetts, Michigan and Pennsylvania properties.
Percent of base rent which is applied from security deposits for lease payments			100%
Calyx Peak MO [Member] | Missouri Property
Percent of base rent deferral under lease			100%
Payback of the deferred rent (in months)			12 months
PharmaCann | New York Properties
Increase amount of tenant improvement allowance		$ 15,000,000
Tenant improvement allowance		93,500,000
Medical Investor Holdings LLC | California Property
Real Estate Loans Receivable	$ 16,100,000				$ 16,100,000
Extension Term					12 months
Minimum Principal Balance Payment	$ 500,000				$ 500,000
Number of Options to Extend | item					2
Accumulated depreciation				1,500,000			1,500,000
Number of properties sold | property	4
Contracted sale price of properties disposed					$ 16,200,000
Medical Investor Holdings LLC | Land | California Property
Gross carrying value				3,400,000			3,400,000
Medical Investor Holdings LLC | Building and Improvements | California Property
Gross carrying value				$ 13,900,000			$ 13,900,000
Ascend Wellness Holdings, Inc. | New Jersey properties
Increase amount of tenant improvement allowance		15,000,000
Tenant improvement allowance		19,600,000
Goodness Growth Holdings Inc. | New York Properties
Increase amount of tenant improvement allowance		4,000,000
Tenant improvement allowance		$ 53,400,000

Investments in Real Estate - Fu

Investments in Real Estate - Future Contractual Minimum Rent (Details) $ in Thousands	Jun. 30, 2023 USD ($)
Contractual Minimum Rent
2023 (six months ending December 31)	$ 143,487
2024	296,831
2025	305,564
2026	314,623
2027	323,953
Thereafter	4,167,236
Total	$ 5,551,694

Debt - Exchangeable Senior Note

Debt - Exchangeable Senior Notes - Additional Information (Details)	3 Months Ended	6 Months Ended
	Jun. 30, 2022 USD ($) shares	Jun. 30, 2023 USD ($) $ / shares shares	Jun. 30, 2022 USD ($) shares	Dec. 31, 2022 USD ($)
Principal amount		$ 304,436,000
Number of shares issued upon conversion | shares		32,200
Gain on exchange of debt		$ 22,000
Threshold Limit of Convertible Debt for Issue of Shares		986,000
Outstanding principal amount		2,000,000
Exchange of Exchangeable Senior Notes	$ 3,014,000	1,964,000	$ 26,665,000
Additional Paid-In-Capital
Exchange of Exchangeable Senior Notes	$ 3,014,000	1,964,000	$ 26,665,000
Exchangeable Senior Notes
Principal amount		$ 4,436,000		$ 6,436,000
Interest rate		3.75%
Number of shares issued upon conversion | shares	47,059	32,200	412,901
Outstanding principal amount	$ 3,100,000	$ 2,000,000	$ 26,900,000
Loss on exchange of Exchangeable Senior Notes	7,000		125,000
Exchange of Exchangeable Senior Notes	$ 3,000,000		$ 26,700,000
Exchangeable Senior Notes | Accounts payable and accrued expenses
Accrued interest payable		$ 49,000		$ 70,000
Exchangeable Senior Notes | Common Stock
Exchange rate		16.74033
Amount converted		$ 1,000
Exchange price | $ / shares		$ 59.74

Debt - Exchangeable Senior No_2

Debt - Exchangeable Senior Notes - Interest expense (Details) - Exchangeable Senior Notes - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Cash coupon	$ 42	$ 55	$ 99	$ 331
Amortization of issuance cost	8	13	20	71
Total interest expense	$ 50	$ 68	$ 119	$ 402

Debt - Exchangeable Senior No_3

Debt - Exchangeable Senior Notes - Carrying value (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Principal amount	$ 304,436
Exchangeable Senior Notes
Principal amount	4,436	$ 6,436
Unamortized issuance cost	(22)	(56)
Carrying value	$ 4,414	$ 6,380

Debt - Notes due 2026 (Details)

Debt - Notes due 2026 (Details) - USD ($) $ in Thousands		6 Months Ended
	May 25, 2021	Jun. 30, 2023	Dec. 31, 2022
Principal amount		$ 304,436
Notes due 2026
Principal amount	$ 300,000	$ 300,000	$ 300,000
Interest rate	5.50%
Issuance costs	$ 6,800
Notes due 2026 | Minimum
Debt instrument change in debt rating interest rate	6%
Notes due 2026 | Maximum
Debt instrument change in debt rating interest rate	6.50%
Notes due 2026 | Redeemed Prior To February 25, 2026
Percentage of principal amount redeemed		100%
Notes due 2026 | Redeemed On Or After February 25, 2026
Percentage of principal amount redeemed		100%
Notes due 2026 | Accounts payable and accrued expenses
Accrued interest payable		$ 2,100	$ 2,100

Debt - Notes due 2026 - Interes

Debt - Notes due 2026 - Interest expense (Details) - Notes due 2026 - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Cash coupon	$ 4,125	$ 4,125	$ 8,250	$ 8,250
Amortization of issuance cost	331	311	657	618
Capitalized interest	(34)		(34)
Total interest expense	$ 4,422	$ 4,436	$ 8,873	$ 8,868

Debt - Notes due 2026 - Carryin

Debt - Notes due 2026 - Carrying value (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	May 25, 2021
Principal amount	$ 304,436
Notes due 2026
Principal amount	300,000	$ 300,000	$ 300,000
Unamortized issuance cost	(4,228)	(4,885)
Carrying value	$ 295,772	$ 295,115

Debt - Principal Payments (Deta

Debt - Principal Payments (Details) $ in Thousands	Jun. 30, 2023 USD ($)
Debt
2024	$ 4,436
2026	300,000
Total	$ 304,436

Net Income Per Share - Addition

Net Income Per Share - Additional information (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Dilutive effect of Exchangeable Senior Notes	74,260	103,742	87,437	304,348
PSUs
Antidilutive securities excluded from computation	0	0	0	0

Net Income Per Share - Computat

Net Income Per Share - Computations of net income per basic and diluted share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Net Income Per Share
Net income	$ 41,269	$ 40,214	$ 82,361	$ 75,264
Preferred stock dividends	(338)	(338)	(676)	(676)
Distribution to participating securities	(373)	(207)	(734)	(409)
Net income attributable to common stockholders used to compute net income per share - basic	40,558	39,669	80,951	74,179
Dilutive effect of Exchangeable Senior Notes	50	68	119	402
Net income attributable to common stockholders used to compute net income per share - diluted	$ 40,608	$ 39,737	$ 81,070	$ 74,581
Weighted-average common shares outstanding:
Basic	27,981,517	27,850,561	27,965,720	26,741,568
Restricted stock and RSUs	201,462	82,387	186,684	113,858
Dilutive effect of Exchangeable Senior Notes	74,260	103,742	87,437	304,348
Diluted	28,257,239	28,036,690	28,239,841	27,159,774
Net income attributable to common stockholders per share:
Basic	$ 1.45	$ 1.42	$ 2.89	$ 2.77
Diluted	$ 1.44	$ 1.42	$ 2.87	$ 2.75

Fair Value of Financial Instr_3

Fair Value of Financial Instruments (Details) $ in Thousands	Jun. 30, 2023 USD ($)	Dec. 31, 2022 USD ($)
Investments, Carrying Value	$ 72,726	$ 200,935
Exchangeable Senior Notes, Carrying Value	4,414	6,380
Notes due 2026, Carrying Value	295,772	295,115
Construction loan receivable	20,917	18,021
Investments, Fair Value	72,550	200,715
Exchangeable Senior Notes, Fair Value	5,476	10,282
Notes due 2026, Fair Value	253,395	264,234
Construction Loan, Fair Value	$ 25,350	$ 20,167
Expected market yield
Loan Receivable, Measurement Input	0.25	0.25

Fair Value of Financial Instr_4

Fair Value of Financial Instruments - Additional Information (Details) - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Money market funds
Cash and Cash Equivalents, Fair Value Disclosure	$ 79.7	$ 78

Common Stock Incentive Plan - A

Common Stock Incentive Plan - Additional Information (Details) - USD ($) $ in Millions	1 Months Ended		3 Months Ended			6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Restricted Shares
Unrecognized compensation cost			$ 6.1			$ 6.1
Amortization period						2 years
Fair value of restricted stock						$ 1.7
Granted			5,055	35,565
RSUs
Unrecognized compensation cost			$ 8.6			$ 8.6
Amortization period						2 years 1 month 6 days
Granted			4,494	61,785
PSUs
Amortization period						1 year 4 months 24 days
Granted	102,641	70,795
Stock-based compensation expense			$ 2.7		$ 5.3	$ 2.7	$ 5.3
Remaining unrecognized compensation			$ 12			$ 12
2016 Plan
Expiration term						10 years
2016 Plan | Maximum
Number of shares authorized			1,000,000			1,000,000

Common Stock Incentive Plan -_2

Common Stock Incentive Plan - Activity (Details) - $ / shares	3 Months Ended
	Jun. 30, 2023	Mar. 31, 2023
Restricted Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares, Beginning Balance	54,841	34,026
Granted	5,055	35,565
Vested	(2,811)	(9,154)
Forfeited		(5,596)
Shares, Ending Balance	57,085	54,841
Weighted-Average Grant Date Fair Value, Beginning Balance	$ 141.31	$ 181.08
Weighted-Average Grant Date Fair Value, Granted	71.23	110.88
Weighted-Average Grant Date Fair Value, Vested	128.11	187
Weighted-Average Grant Date Fair Value, Forfeited		115.01
Weighted-Average Grant Date Fair Value, Ending Balance	$ 135.75	$ 141.31
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares, Beginning Balance	145,462	83,677
Granted	4,494	61,785
Shares, Ending Balance	149,956	145,462
Weighted-Average Grant Date Fair Value, Beginning Balance	$ 127.01	$ 144.30
Weighted-Average Grant Date Fair Value, Granted	71.23	103.60
Weighted-Average Grant Date Fair Value, Ending Balance	$ 125.34	$ 127.01

Commitments and Contingencies_2

Commitments and Contingencies (Details) $ in Thousands	Jun. 30, 2023 USD ($)
Commitments and Contingencies
2023 (six months ending December 31)	$ 249
2024	511
2025	526
2026	543
2027	45
Total future contractual lease payments	1,874
Effect of discounting	(192)
Office lease liability	$ 1,682
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration]	Other Liabilities

Commitments and Contingencies -

Commitments and Contingencies - Additional Information (Details)	Sep. 11, 2022 USD ($)	Jun. 30, 2023 USD ($) property	Dec. 31, 2022 USD ($) property
Other Commitments [Line Items]
Construction in progress		$ 117,413,000	$ 54,106,000
Number of properties lease terminated | property		2	2
Amended Class Action Lawsuit
Other Commitments [Line Items]
Amount accrued		$ 0
Derivative Action Lawsuit
Other Commitments [Line Items]
Amount accrued		0
Kings Garden Lawsuit
Other Commitments [Line Items]
Funds recovered	$ 15,600,000
Additional costs under investigation		$ 9,600,000
Kings Garden. | Kings Garden Lawsuit
Other Commitments [Line Items]
Number of leased properties | property		6	6
Construction in progress		$ 33,100,000	$ 33,200,000
Number of leased properties that are operational | property		4	4
Number of leased properties with expansion project | property		1	1
Number of leased properties that were in development or redevelopment | property		2	2
Commitments related to improvement allowances
Other Commitments [Line Items]
Other Commitment		$ 29,600,000
Commitments related to construction loan
Other Commitments [Line Items]
Other Commitment		$ 2,100,000

Subsequent Events (Details)

Subsequent Events (Details) - Subsequent Event - 4Front Ventures Corp.	1 Months Ended
	Jul. 31, 2023
Subsequent Event [Line Items]
Percentage of security deposit hold on base rent due from tenant	50%
Repayment period of tenant	12 months

Pay vs Performance Disclosure

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Pay vs Performance Disclosure
Net Income (Loss)	$ 41,269	$ 40,214	$ 82,361	$ 75,264

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended
	Jun. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false