Revolutionary Industrial Properties (NYSE:IIPR) is expanding in Michigan.
The actual estate investment trust (REIT) bought a new 156,000-square-foot house in Warren, Michigan for $19 million, excluding transaction expenses.
IIP is leasing the facility to LivWell Holdings licensee LivWell Michigan. After upgrades are completed — IIP will cover up to $23 million in tenant improvements — LivWell will use the facility to cultivate and procedure cannabis.
“We are excited to announce the starting of our lengthy-term actual estate partnership with LivWell,” IIP CEO Paul Smithers stated in a press release. “LivWell has created a tremendous track record of accomplishment in Colorado during the final decade, and we appear forward to supporting the speedy expansion of their operations in Michigan.”
IIP has positioned itself as a useful actual estate companion for healthcare marijuana firms. By acquiring and leasing properties to cannabis producers, it permits them to expand more rapidly by minimizing their capital specifications. This is specifically significant these days, as a lot of cannabis firms are acquiring it complicated to raise capital from conventional sources, such as industrial banks.
IIP has currently invested far more than $300 million in actual estate acquisitions. The REIT owns 32 properties in 12 U.S. states that collectively cover two.three million rentable square feet. Demand for these facilities has been robust the properties are 100% leased with typical terms of practically 16 years. They are also extremely lucrative for IIP and its shareholders, with typical returns on invested capital of far more than 14.1%.
With far more states anticipated to legalize marijuana in the coming years, demand for cannabis production facilities really should continue to develop. Investors, in turn, can anticipate Revolutionary Industrial Properties to steadily expand its actual estate portfolio in the months and years ahead.