Why Innovative Industrial Properties Stock Withered by Almost 40% in December
For any person or company that makes coin by renting property, a tenant default is the situation nightmares are made of. That’s only compounded if the landlord in question manages multiple properties and a tenant defaults on more than one of them.
Such was the situation with marijuana real estate investment trust (REIT) Innovative Industrial Properties (NYSE: IIPR) in the final month of 2024. And not only did it suffer a damaging default event, but an analyst tracking its stock also downgraded his recommendation.
Just a few days before Christmas, Innovative’s tenant PharmaCann defaulted on its latest rent payments for six of the 11 properties it leases from the REIT. All told, the unpaid monies totaled $4.2 million for December. Although it did pay for the other five facilities, it has cross-default provisions baked into its contracts. So, technically, it defaulted on those too.
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