Recent IIPR transcripts
Associated IIPR filings
Brian Wolfe | VP, General Counsel & Company Secretary |
Alan Gold | Executive Chairman |
Paul Smithers | President, CEO & Director |
Ben Regin | Director, Investments & Finance |
Catherine Hastings | CFO & Treasurer |
William Catherwood | BTIG |
Scott Fortune | ROTH Capital Partners |
Daniel Santos | Piper Sandler & Co. |
Good day, and welcome to the Innovative Industrial Properties Second Quarter Earnings conference call. [Operator Instructions]. I would now like to turn the conference over to Brian Wolfe. Please go ahead.
Thank you for joining the call. Gold, Catherine Paul and Hastings, Vice of Alan Chief President Ben are President Officer; Executive Chief Investments. today Executive Smithers, Chairman; and Regin, Presenting Financial Officer;
uncertainties made to forward-looking and deemed within actual other of materially Private the and safe differ everyone like Securities may the statements I'd due of results variety of begin, conference call may we that Before of to XXXX, statements harbor during meaning Litigation today's be Act risks, remind factors. a the Reform
intention For discussion and some you the uncertainties as filed issued the whether of periodically of news to well or call company's or forward-looking refer revise as Alan. a with update as otherwise. yesterday the the the a with information, statements, any or I I'll the SEC reports of detailed to SEC. X-K ongoing future any on and filed the risks over of Alan? company's disclaims obligation new result hand events to Form release now business, The company
of we Brian, on to Thank update forward truly providing on look to everyone. our call continued we industry proud February. Today, an views the evolution welcome, our dynamic And business you in are since our so and last a serve. you,
certainly regulated there's company's cannabis lot our a the Now to industry in whole. activity from recap as a
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Thanks, Alan.
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allow pandemic, During the protect in purchasing and social for modified delivery, home and authorities cannabis that both customers many such cannabis delivery. online of their methods also medical ordering distancing curbside purposes. options state companies, more patients cannabis more to part local are many and permanent Many customers to employees adapted provide designed whom to reliable regulations to the different and with utilize for pre-existing preferences conditions of of as
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Ascend Wellness.
real with top-performing Ascend Under Massachusetts Michigan, Kurtin's We total Ohio. nearly Illinois, and properties leadership, and have its with of Michigan, evolution a New $XXX estate Founder XXXX Ascend Jersey million. MSOs have highly been on and continues X commitment the across in since Massachusetts, Abner representing one footprint as Ascend's partner and Illinois, of partnered CEO, a strategic
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vote of execute their as of Joe Directors, transfer for ours Motor addition in shareholder as served to closing representing the tenant Ascend a a over to Hinrichs million. commitment Board Florida of team Company forma year, of later little continue partner Automotive, properties the Pro acquisition and conditions, subject years, who Ascend's Harvest, also to at Ford $XX the is shareholder to over be which this an with Trulieve total of recently at great on month. strategy. license they President, to expected recently satisfaction for welcomed most for a authorizations scheduled its is Harvest a the completed XX Executive approval Ford's this later a and Massachusetts,
nearly ours Sciences X,XXX continues signing. vertically of from Our retail applications $X.X month's North states $XXX facilities, The Led to Florida, and employees note and the and Pennsylvania, in additional last employees industry and integrated and by Virginia, in of through about $XX in facilities Harvest cultivation we value about Dakota Rounding result Virginia, to Maryland, additional transaction of a an global to forma pro revenue processing total with May, leased with in market feet cannabis XXXX, cultivation in New holistic in Pennsylvania Virginia, and is nearly the Nevada footprint that of also largest at these pending company We X capital largest million cultivation Florida in million. QX and total XXX,XXX Massachusetts, like was investment California, of In Care's our Columbia Care in X XXX in With U.S. its Virginia its dispensaries states, total New Jersey, by New company capacity license licenses new Curaleaf's Jersey, in representing processing extending alone. Columbia Illinois. jurisdictions Pennsylvania, raise representing to XX% representing this in of Maryland, acquiring million in the founded million largest operations of the June, licenses to footprint Florida square continuing and Trulieve transfers. CEO, closed by a In perspective Health Trulieve out properties growth and Michigan, U.S., closing in the EBITDA notes Nevada, approximately the a total Recreation, in leased issuance Holistic We of with MSOs Curaleaf in capturing million includes and Kim an dispensaries, owned, also privately medical oversubscribed license it XX Curaleaf. Curaleaf Washington, and generation of another one Missouri square a processing XX Limited, opportunities million the the cannabis of into Michigan X states with $XX Holistic sites, cannabis cannabis of to and independent nationwide, over last Pennsylvania, in U.S. to in California, partner Rivers, earlier commitment operations excess the late in U.S. Curaleaf making grow million. in Virginia organic its definitive the market own Harvest or this acquisition combination dominant has of $XXX and a locations originally reaching be revenue and over licenses of top leadership and would $XXX acquisition feet CAD $XXX Fund. to of a properties own was Life governmental Europe, Jersey, in operator revenue, operate and of in one on is XX West announced arena. approvals the the West Colorado, time $XX cannabis million combined at forma sites, in continues the operator XX X under which is and million operation in of EU, X on in $XXX XX commitment deepening in tenants, week million. with leased on an commitment May, D.C., Care XX cultivation U.S. filings. production that EMMAC dispensaries a of XXX capital largest Florida into of basis retail tenant according Massachusetts, total includes integrated and a one Holistic. cultivation that including cultivation Pennsylvania Massachusetts, development. $XXX.X Stoneview position led is XXXX I announced year and and California, cannabis completed approximately convertible the in to in XXX its over raised pending to billion vertically convertible properties and adjusted pro presence states, largest looks also largest a existing in has with completed final of Trulieve the alone. awarded X expansion Trulieve business, Georgia. West Columbia investment Connecticut, total raise and million. and in representing and property, entered XX approval Note April presence Harvest Harvest in Illinois, and acquire where Harbert leased is the Class Trulieve properties our capital states own agreement MSOs, to it Harvest's commence Ohio. XX
September respect Colorado, place Medical company of with in in with Columbia call, we as last corporate partners the in Solution, acquisitions, Leaf and in As well Medical, Leaf this prior acquisition received on of year. and Care tenant Green connection partner Pennsylvania with Columbia our previously tenant we Care to our completed as year those Green also In Virginia, one TGS. guarantees Green our the of announced parent from our noted the earlier leases
other to and our on other execute tenant are we tenant our Massachusetts introduce XX continue estate we to in establishing just top with growing and time Michigan our of on have we our Wellness path tenant existing to While real Sozo over turn Catherine? operators. it new new I'll that, touch With with as tenants, in well, relationships and continue partners partners proud long-term Temescal our to partners, strong Catherine.
leasing of properties be the results from last months, been of quarters to acquisitions Thanks, XXXX. partners rent for the $XX.X certain presented another a and at allowances resulted which tenant certain our increase and for driven reflected by year. that our the and of operations continue increase throughout properties, Ben. past to generated of and quarter, tenants yet contractual tenant base escalations to million busy many provided first We XXX% new improvement quarter QX acquisition adjustments primarily It's execute in X properties. challenges was over The in strength of at both revenues approximately for total investments, additional their continue rent with the the financial in
stipulated in Angeles, XXXX release, us QX property. for by noted the also in June, revenue paid owed rent the to receivership which our our at we press includes XXXX As $XXX,XXX to relates California Los
for XXXX were Holistic new call, we other an in a cannabis And of long-term as partner last tenant our discussed the to executed granted has year, monthly repaid, until to no that our a leases the with the certain our payments Holistic in our million release, for to we number scheduled of partial by reflects of repaid the deferrals deferrals the as end the of million of basis. remaining under that amount the in our were of of only and update revenue revenues on that when And for revenues investments at lease prior reported licenses X December $X.X or abatements quarter XXXX. revenues, we've in all executed And from our sold executed $X.X of property. account leases and a acquisitions with or we the also quarter. amendments And in January we Industries, been for the lease as for we temporary the As course, after in QX quarters of receivership the the past, leases states, to during a concluded continue impacted entire QX press tenants cash rent indicated pandemic the as pro in of deferrals onset rata full quarter. rent in
income XXXX, share. $XX million ended $X.XX recorded or June For we per months the of XX, diluted net X
of been of case fourth of calculating in for first X XXXX. the net has the noted were earnings our purposes and release, our quarter This considered starting AFFO dilutive As in XXXX. months notes income, exchangeable the QX press FFO for and
to FFO shares for common result, measures. are current million for exchange as notes a notes to results then also and and the treated they've back stock approximately diluted difficult as adding of relates expense to $X.X and been if interest million year we second of Similar highlight wanted at XXXX exchangeable QX XXXX, half prior first count. and approximately comparison the it to the as exchangeable between FFO which X.X for results, cash periods adding an to AFFO QX in exchanged and fully noncash item, the the resulted the As quarter and for price, XXXX the makes QX diluted it especially share the XXXX this quarter apples-to-apples
accounting anti-dilutive for As in purposes. the exchangeable were prior year notes period, the
second compensation and or was funds on expense diluted, back to So per noncash and of or adds the net which both funds from from June and for dividend million million quarterly noncash cash The interest $X.XX as paid exchangeable XXXX record reflects our we approximately operations income quarter. was senior share property $XX $XX.X from of unsecured notes stock to quarter, the our notes depreciation to the operations, to related common XX. Adjusted diluted issued expense $X.XX diluted share. share. interest $X.XX which back QX noncash per XX, adds year's XX% prior second per common FFO, June newly of increase On a stockholders dividend stock-based
past, As basis. portfolio the Board of XX% in dividend to a a XX% stabilized the payout of we've indicated on to continues AFFO ratio target
tenant also leases. improvement We offered our improvements estate construction or of fund allowances to continued properties our in as operators real our many into to under development
we've expansion to facility or demands. market previously either to facility cannabis growing address an these critical to improvements funding existing a noticed, are As redeveloping
our to As to operators our mentioned, tenant with and leases base for for rent. proud corresponding at continue facilities to been we've a many of the expansion partner Ben increase previously capital amend provide additional in
properties. And XX, months with and tenant the financing During and June $XXX improvements approximately approximately at funded activity. of respect we to XXXX, ended million relating costs X $XXX our capitalized construction million to
of X.X% is we our this offering notes. businesses and XXXX. its their on exchangeable non-dilutive opening we in the his execute only May were strong, partners options attractively interest a combination on years with and expand its in notes unsecured our over to throughout flexible proven notes sheet We priced And million focused on a capital capital. in thrilled debt mentioned XXXX bear an outstanding. at The proud roster announce of unprecedented of rating, this to along of due the the breadth per team our X-year maturing to are tenant credit of debut balance have pandemic, with with annum senior Alan tremendous in tenant execution IIP maintaining by bond As $XXX the remarks, followed investment-grade the corporate obtaining ability
And total Alan? I'll turn billion. it end, no have secured our excess total approximately that, to quarter XX%, debt. Alan. gross assets back assets was continue as to of of We $X.X with total gross to with debt And in
Thanks, the closing. Catherine. I'd in like note following to
are strength we investment-grade and resilience and of operations. with tenants' and with company for through success, our significant the strength balance which demonstrated ability their execution market, a sheet. roster The rating the view bond we strength our highlighted, unsecured another our the to raise our the clear priced and of demonstration We of our our and reached credit partners' tenant portfolio tenant continued of our property capital milestone Ben non-dilutive personally As our partners attractively innings thrilled regulated quality on cannabis is maturity. we of the dynamic fastest-growing our continuing in forward continues the The best and we the early industry, to the as I go-to always, the as And across States. us its of capital work want thank our long-term stewards one as and look be this support to industries, we're of of to real for entrusting your and to estate stockholders partner believe operators industry for best-in-class that for still yet United your continued come as investment.
Operator, With questions. in like our could will and that to open to call questions. up please up it to you very that, have continue I'd day. every for role best open do We the
Instructions]. [Operator
question will come BTIG. first with Catherwood Tom from Our
size for and very morning, helpful. you increased deal the average was prepared acquisitions, the in the we're everyone, materially all looking over When color remarks. XXXX. thank at Good has It XXXX
last million I average range. this million the in was and year, year, deal far roughly $XX think size it something $XX the is so
of that. X So kind questions from
of kind and that with how larger maybe to is right deals X, now tenants, And portfolio pipeline First, operators new then is the compared of looking your acquisition as breaking into kind how down pipeline issuances previous of well? quarters? bringing in terms existing follow-on
Tom. Thanks,
complex and how question that the to large One, there. see looking is pipeline answer fantastic. Let's
X be that in that -- as we move And to we into and continue continue frame. XXXX. capital place -- that continues of think XXXX will X-month time will to through that able that our to the balance We
is to credit start we, type to with industry reason to you're been needs. and quality size Secondly, to as a deal access transactions. those a change the -- of credits deal deal able large, seeing the And quality, I that meet -- deal size. are within larger -- bifurcation our that size able the and develop those you think of type the what is in you're the in And is higher change a own are seeing the tenants have high occurring, capital,
we are that with loan. multistate we we that a as in are We operators. different emerging our type mid-tier construction of we credit issued the at what multistate type California, such wide a to types such are but in high contemplating, continue to these seeing, of variety have And where emerging working are see entity pipeline quality, entities tenants from companies and as high tenants the operators,
we're demand We're our through excited and So we're I XXXX. -- our continued all XXXX for see about things. capital prospects seeing of into and very XXXX think those very,
or Ben go into there the be this had of estate How And Sozo for make evaluating do that, investments large companies not you new about and of quarter. early-stage stage mentioned addition about And and and in -- assets? the how you talked portfolio could entities, to companies? past the along whether with real Temescal an with determining early these opportunity these
our changed from But to growers only spent that the industry Well, where tenants, existing spent -- checks so we in of for we running tenants brings come estate time our they've type in not the in of just underwriting company. the do skills evaluating these the marketing but a their a general. real younger specifically those only expertise and with specific lot state entities. background in not a And in these on reputations to transaction and most utilize estate network and their business, process understanding in on then really real growing. or of the hasn't management We focus great the team, deal time start-up proposed
start-up last So those supporting companies, opportunity financial very to much capital wherewithal, we think that our these we where potential or of the all going committed of believe requires are but -- they a and that how to strong they strong and are many be what has is underwriting is for that most financial how investors the pitfalls or what backing. exciting analysis growth an a raised, one came already the is, they've raised along with tenants how from important there goes of where the capital into one probably and is
that, Alan. or And Alan. either finally me, appreciate for for I for Paul
initial rolling programs. both out new states lot that not Connecticut, discussion in Jersey about recreational there's are but that, mentioned a about as the much what had We after of You and stage. hear discussion New York, especially happens New
Jersey are beyond people running that their that they York to as as expand beyond to and is know is New going when XX those we to example, For expand rush to New licenses. up possible. going the win in get soon And going And do, XX.
the in new happens So license maybe your experience, operators? when states their the than what be holders may more opportunity typically programs? with limited there is legacy coming that license expand for in are there IIPR licensing And with
Tom, is Paul. Hello, this Yes.
to would seen like. as a go a there's certainly look people as we has doesn't But there's them. slow lawsuits, want a example. seen program, excitement, I that REC need into medical morphs to down quickly their as So lot things a development. the gone program we've New York, for of if along program, and what because when capital we've a that, state certainly think I operators every program these new lot is learn medical they And usually that historically, some expand And in been facility. frustration great there is with been think before But as there's other adopts of
a to encouraged pretty really rollout that a tremendous success. about great of example rollouts. really the as we're has just REC had look And Illinois So we
real single those we're being them business able become made operators of we've state out up to capital these newer So we're state great certainly, that develop for And of demand operators majority that the mandate as rollout amount And yes, states seeing for capital a states multistate because the certain we on licenses those into into space their early a the our make be tenants. spot our reserved single be the portfolio that as that these a program. just think that really existing today. tremendous watch states -- operators, -- and there'll REC of quick from in successful will new our do partner
Roth will next Scott with Our from question come Capital. Fortune
one follow-up more on that. Just
done a of single lot states on and have detail guys these state operators. You
York, size awarding your is New equity see social there. a social onboard and potentially working How in as things. coming at side lot social Jersey, that Any states initiatives helping emerging with some this they're of cultivations, we equity out of New equity tenants on programs licenses are larger although of kind with smaller IPR more looking forward? going these these for that
to of the us. the federal come have good to so the more level. But on Yes, at get will Yes, support the financial a -- looking to is and excited working be at if new too these we're for Scott, money the level. financial help SBA some provide that is We comfortable SBA we're this opportunities that And the at state, provide in assistance, new some have. depending not to think operators. similar there's a opportunity And we the about program little going some them Paul. able to with an opportunities state little very program, some operators state but of more these state a could
approach again, and these very that confident opportunities nicely about think, tenants. we're excited be be And going able that the underwriting them, we're some operators in certainly we're fit on will we'll social disciplined to So the of equity find into our program. we to
larger From you to similar then then type at of cost guys see of expect currently a MSO some onboard versus leaseback stack of And cap debt competitive XXXX? experiencing lot still as tenants estate for far competitive rates capital the companies, more little opportunity seeing of and as the and a what landscape, are different private lower large from forward into And options. question. are operators we real XXXX, competitive And coming offer for public this tenants? seeing the how starting options standpoint? a are looking you What also going a and these
Yes.
industry, coming seeing into credits the in wide are competitive organizations. And and of of in we general. general, has remember additional that industry a size So capital this range
able with think with what that so continue to grown that more yes, we a very different with And that, are of is working large obtain be source to to very consider the And we're We raising strengthen to them, -- are the good sources. dilutive them. seeing variety non-dilutive from can operators we've capital and/or competitive we that at sheet balance continue what type a they of continue capital, same equity debt. can convertible time selling I while their potentially capital
of our we access that quite So are emerging need to that. need large also of spoke are access don't I -- have our capital that about. to a the capital, seeing that number kind But seeing -- new very a competitive great just MSOs and we capital same that
tube In and believe emerging to new ideal are are out addition spinning continue to, our us are large there growers that existing allow capital yields. on then of to that top I attractive them are facilities. -- type spaces all We're that, very and between we that of for you retail industrial and programs provide at, to bifurcation of seeing growth think, entities the
becoming a bifurcation that of We wider seeing yields. are
be and a very still is long in competitive for of we're capital our we going think we demand high-quality capital, that are and so And time. -- to providing period
recently range the rates are rates what kind as on kind then cap most quick guys of for Real you those out yield forward? the of that going funding you and look
the yields, access the of lowered given at our capital, I the to think to of lower probably perhaps, quality credits our -- have our access and the more having end. -- credits competitive
X.X% seeing size we're perhaps XX% XX% XX%, before to we're opportunities now to range. talked we -- in that and So about still
-- the maintain to opportunities. when of range wide is go opportunities And that lower But we X% closer a -- end there wide in think we believe that that add you transactions of into range type lower is business chunky. a There's could there, growers. are I retail range. that those even
So at lower some we're upper end end, the see we're some and to over going at the see time. going to
will Daniel Our from next with Santos question come Piper Sandler.
kind just of continue I'll line. along that
and You are talked is and than guess, we're I even quickly of about how yields much the relative the used the surprising timing, could you compressing, expecting? yields you? were X.X% X%, to into is probably It's how think yield And comment velocity to compression. how much lower on hearing. compressed deals I is or what you have certainly that
Yes.
and transactions, So before. these variety now investment started -- opportunities we you tenants doing I a I have used yields see think compressed. the don't have didn't industry that don't and mean When variety word of into of yield compression. I we a have think I have the we that credits, didn't come high-quality we do.
-- don't so And yield yields compressed there characterize sense. any as I have that compression. wouldn't I we being think So in
competitive the capital. they're But still for, been have risk-adjusted that they industry more we're deservedly so and the strong basis, achieving industry, risk-adjusted there's the a we we're we're -- expansion trying yields while what young, in describe that think is very in are that of past, think basis, same mature, seeing an We're that's think, of today. on I and seeing it's different just to opportunities. types continuing seen range it's yield. to very And getting continuing -- have seeing this a very some I that I to credits here
REIT think legislative as sort type the sectors, prepared or think invested REIT get whether the continue to different be to space reform? a a you that do while? REIT kind of sort best it's you'll REIT do a who's in then, hit maybe you subsector someone Or of running for we ground of of once the only that's do across And probably Alan, who
we're think to I that that one. don't Well, be think we there, only the there's do competitors out I and going don't I -- -- have
that for to think on in there industry, a do We that in is become experts are occur. that one and I for it does forever. could enter years an working understanding industry. on capital the but and underwriting -- and they And have of us this of in we cost the have a future, enormous opportunities the be focus do this product specialized continue will evaluating specialized business. in many and you we garnered lower that take type, than lead credits industry believe we've that believe Whenever the time others it to you that over it,
he the his already is of the what going that one the so out at any is Schumer and or of last And I of the pass know the prepared this comments something guessing to when same if likes of teeth what's have during comes But won't will after Presumably, once list sort kind impossible. appreciate time, table. negotiation I one, Bill process of probably you starts. timing wish remarks Congress put on less the may. probably
on guess, to if what were that compares thoughts So has on you sort XX I runway And your XX -- could the on over it, that how timing of months? impacted comment you next, Bill specifically expecting? your to call and
Yes, Paul. Dan, this is
a out Bill, pretty wants votes it's he the to actually of correct Senator democratic it have certainly, even understanding. put are think, he the And is with side Schumer's happy real it does on with he that not everything He there, outlined. list what with wanted. get wish I as We the the
He's won't next expect he through of probably substantial put rewrite, go September a -- to year. there. using the on out it then And beginning reintroduced comments we Bill. be So until September it'll get for the
So we're happy with it.
portfolio like happy we've the we I that. because to think spoken will their program. that do with own equally operators are to see the were idea states direct they in And many of the happy be able
And we the any it changed really that close have, not we continue at legislative day one, always federal opinion slow on are opinion change been of on we not it. process, level keep that. timing the a to we have a our since eye doesn't reform of will surprised, because be and and So our
our Due for over to to Gold concludes to time closing would remarks. the constraints, any turn Alan this conference I back session. like question-and-answer
hard their the we'd forward I'd very our Industrial more Thank stockholders you, and for again you. and team thank like once everybody most Thank to work us achieving the in importantly, call results, that. for of to Properties' today. Innovative and phenomenal thank to their like look on thank we support for joining certainly these
The attending you presentation. today's has Thank now for concluded. conference
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