Innovative Industrial Properties, Inc. (NYSE: IIPR) announced results for the fourth quarter and year ended December 31, 2018. IIPR generated rental revenues of approximately $4.7 million in the quarter, representing a 111% increase from the prior year’s quarter and in line with the Yahoo! Finance analyst estimate.
IIPR recorded net income attributable to common stockholders of approximately $2.3 million for the quarter, or $0.24 per diluted share, and adjusted funds from operations (AFFO) of approximately $3.6 million, or $0.38 per diluted share. AFFO represented an increase of 344% from the prior year’s quarter.
The company paid its seventh consecutive quarterly dividend of $0.35 per share on January 15, 2019, to stockholders representing a 40% increase from the prior year’s quarter. IIPR also declared its eighth consecutive quarterly dividend of $0.45 per share, which is expected to be paid on April 15, 2019, to stockholders of record as of March 29.
In October 2018, IIP completed an underwritten public offering of 2,990,000 shares of common stock, including the exercise in full of the underwriters’ option to purchase an additional 390,000 shares, resulting in net proceeds of approximately $113.9 million.
After the quarter ended, IIPR’s operating partnership subsidiary completed a private of offering in February 2019 of $143.75 million aggregate principal amount of 3.75% exchangeable senior notes due 2024, which includes the exercise in full of the initial purchasers’ option to purchase additional Notes, resulting in estimated net proceeds of approximately $138.4 million.
The company gave the following update about its portfolio in a statement. As of March 13, 2019, IIP owned 13 properties that were 100% leased to state-licensed medical-use cannabis operators and comprising an aggregate of approximately 1,128,000 rentable square feet (including approximately 159,000 rentable square feet under development/redevelopment) in Arizona, California, Colorado, Illinois, Maryland, Massachusetts, Michigan, Minnesota, New York, Ohio and Pennsylvania, with a weighted-average remaining lease term of approximately 14.3 years.
IIPR had invested $161.2 million in the aggregate (excluding transaction costs) and had committed an additional $37.7 million to reimburse certain tenants and sellers for completion of construction and tenant improvements at IIP’s properties. IIPR’s average current yield on invested capital was approximately 15.1% for these 13 properties, calculated as the sum of the initial base rents, supplemental rent (with respect to the lease with PharmaCann LLC at one of IIPR’s New York properties) and property management fees (after the expiration of applicable base rent abatement periods), divided by IIPR’s aggregate investment in these properties (excluding transaction costs and including the aggregate potential tenant reimbursements of $37.7 million).