Innovative Industrial Properties Stock Trading Higher On Q4 Revenue Growth Of 20% YoY

Innovative Industrial Properties, Inc. IIPR generated total revenues of approximately $276.4 million in 2022, compared to approximately $204.6 million for 2021, an increase of 35%. During the twelve months ended December 31, 2022, IIP collected 97% of contractual rents and did not collect rents totaling $8.6 million from four tenants: Kings Garden (California), Vertical (California), Green Peak (Michigan) and an affiliate of Parallel (Pennsylvania).

Full Year 2022 Financial Highlights

• Net income attributable to common stockholders and net income attributable to common stockholders per diluted share of approximately $153.0 million and $5.52, respectively;

• Declared dividends to common stockholders totaling $7.10 per share, a 24% increase over 2021.

• Invested approximately $394 million, including nine acquisitions of properties located in seven states and twelve lease amendments to provide funding of qualifying real estate infrastructure improvements at properties in seven states, expanding IIP’s footprint to 110 properties totaling 8.7 million rentable square feet in 19 states at year end.

Q4 2022 Financial Highlights

• Generated total revenues of approximately $70.5 million in the quarter, representing a 20% increase from the prior year’s fourth quarter.

• Recorded net income attributable to common stockholders of approximately $41.2 million for the quarter, or $1.46 per diluted share, and AFFO of approximately $59.6 million, or $2.12 per diluted share.

• Paid a quarterly dividend of $1.80 per common share on January 13, 2023 to stockholders of record as of December 30, 2022, equal to an annualized dividend of $7.20 per share.

Year-to-Date 2023

• Kings Garden Inc. (Kings Garden) paid rent for February of approximately $825,000 on the four properties it continues to occupy, and indicated it is in discussions for a potential merger or sale of assets.

• Rent collection for IIP’s operating portfolio was 92% for the month ending February 28, 2023.

Balance Sheet Statistics (as of December 31, 2022)

• 12% debt to total gross assets, with approximately $2.6 billion in total gross assets.

• Total quarterly fixed cash interest obligation of approximately $4.2 million.

• No secured debt.

• No debt maturities until May 2026, other than $6.4 million principal amount of 3.75% exchangeable senior notes in 2024.

• Debt service coverage ratio of 15.5x (calculated in accordance with the company’s 5.50% unsecured senior notes due 2026).

Price Action

Innovative Industrial Properties shares were trading 5.43% higher at $87 per share during Tuesday’s pre-market session.

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