INNOVATIVE INDUSTRIAL PROPERTIES INC (IIPR) SPO
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|Company Name||INNOVATIVE INDUSTRIAL PROPERTIES INC|
|Company Address||11440 WEST BERNARDO COURT, SUITE 220
SAN DIEGO, CA 92127
|Company Phone||(858) 997-3332|
|Employees (as of 12/31/2017)||6|
|State of Inc||--|
|Fiscal Year End||12/31|
|Shares Over Alloted||0|
|Shareholder Shares Offered||--|
|Lockup Period (days)||180|
|Quiet Period Expiration||2/26/2018|
We estimate that the net proceeds from the sale of the common stock we will receive from this offering will be approximately $ million (or approximately $ million if the underwriters’ option to purchase additional shares is exercised in full), after deducting underwriting discounts of approximately $ million (or approximately $ million if the underwriters’ option to purchase additional shares is exercised in full) and estimated offering expenses of approximately $200,000 payable by us. We will contribute the net proceeds of this offering to our Operating Partnership as an additional capital contribution. Our Operating Partnership intends to use the net proceeds from this offering to invest in specialized industrial real estate assets that support the regulated medical-use cannabis cultivation and processing industry that are consistent with our investment strategy, and for general corporate purposes. However, we cannot predict if or when we will identify and acquire properties that meet our acquisition criteria. Until appropriate assets can be identified, we may invest the net proceeds of the offering in interest-bearing short-term investments that are consistent with our intention to qualify as a REIT. Any interest-bearing short-term investment we make likely will provide a lower net return than we will seek to achieve from our target assets.
The current market for properties that meet our investment objectives is limited. In addition, we believe finding properties that are appropriate for the specific use of allowing medical-use cannabis growers may be limited as more competitors enter the market, and as medical-use cannabis growers obtain greater access to alternative financing sources, including but not limited to equity and debt financing sources. We face significant competition from a diverse mix of market participants, including but not limited to, other companies with similar business models, independent investors, hedge funds and other real estate investors, hard money lenders, and cannabis operators themselves, all of whom may compete with us in our efforts to acquire real estate zoned for medical-use cannabis facilities. Several competitors have recently entered the marketplace, including Kalyx Development, Inc., AmeriCann, Inc., Zoned Properties, Cannabis-RX, Inc., The CannaBusiness Group, Inc., MJ Holdings, Inc., MJ Real Estate Investors, Home Treasure Finders, Inc., Advanced Cannabis Solutions, Inc. and Grow Condos, Inc. In some instances, we will be competing to acquire real estate with persons who have no interest in the cannabis industry, but have identified value in a piece of real estate that we may be interested in acquiring. These competitors may prevent us from acquiring desirable properties or may cause an increase in the price we must pay for properties. Our competitors may have greater financial and operational resources than we do and may be willing to pay more for certain assets or may be willing to accept more risk than we believe can be prudently managed. In particular, larger companies may enjoy significant competitive advantages that result from, among other things, a lower cost of capital and enhanced operating efficiencies. Our competitors may also adopt transaction structures similar to ours, which would decrease our competitive advantage in offering flexible transaction terms. In addition, due to a number of factors, including but not limited to potential greater clarity of the laws and regulations governing medical-use cannabis by state and federal governments, the number of entities and the amount of funds competing for suitable investment properties may increase, resulting in increased demand and increased prices paid for these properties. If we pay higher prices for properties, our profitability may decrease, and you may experience a lower return on our common stock. Increased competition for properties may also preclude us from acquiring those properties that would generate attractive returns to us.
We are a self-advised Maryland corporation focused on the acquisition, ownership and management of specialized industrial properties leased to experienced, state-licensed operators for their regulated medical-use 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, 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 a subsidiary, 100% of the limited partnership interests in our Operating Partnership. --- Our principal executive offices are located at 11440 West Bernardo Court, Suite 220, San Diego, CA 92127. Our telephone number is (858) 997-3332. Our website is www.innovativeindustrialproperties.com.
|Auditor||BDO USA, LLP|
|Company Counsel||Foley & Lardner LLP|
|Lead Underwriter||Ladenburg Thalmann & Co. Inc.|
|Transfer Agent||Computershare Trust Company, N.A|
|Underwriter||Compass Point Research & Trading, LLC|
|Underwriter||National Securities Corp|
|Underwriter Counsel||DLA Piper LLP (US)|
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