Innovative Industrial Properties
On February 8, Innovative Industrial Properties (IIPR) announced that it acquired property in Sacramento, California, for $6.7 million. The property is ~43,000 square feet of industrial space. The acquisition is Innovative Industrial Properties’ first investment in California. The acquisition helps the company take its portfolio in the United States to ten states. With this acquisition, IIPR owns 12 properties with ~1,070,000 rentable square feet.
Innovative Industrial Properties entered into a triple-net lease agreement with an experienced operator. The operator intends to operate the property as a cannabis cultivation facility, according to California regulations.
Paul Smithers, Innovative Industrial Properties’ president and CEO, said, “We are excited to add California to our portfolio. The tenant has a long track record of success serving patients in need in California, and we look forward to completing the redevelopment of the property with their team, which will enable them to significantly expand their reach.”
Innovative Industrial Properties rose ~1.6% and closed at $64.31 for the week ending February 8. As a result of these gains, the stock traded 32.1% above its 100-day moving average price of $48.67, which indicates bullishness in the stock. On a year-to-date basis, the stock has risen 40.1%. However, investors should be cautious. The company’s 14-day relative strength index is at 68, which suggests that the stock is very close to moving into an overbought position.
Innovative Industrial Properties outperformed the ETFMG Alternative Harvest ETF (MJ), which fell ~4.3% during the same period. The fund also provides exposure to Cronos Group (CRON), Canopy Growth (CGC), and Aurora Cannabis (ACB) with weights of 18.8%, 8.6%, and 7.8%, respectively, as of February 8.