Innovative Industrial Properties, Inc.

For the first quarter, total revenues were $69 million, up 3.5% versus the fourth quarter, driven mainly by $3.2 million of payments from PharmaCann and $1.5 million received in settlement of remaining unpaid administrative rents from Gold Flora. AFFO was $53.4 million, or $1.88 per share, in line with the fourth quarter of 2025. Year-to-date, the company raised $128 million of gross capital, including $72 million of preferred equity, $36 million of common equity and $20 million of secured debt at a fixed 9% rate. As of March 31, liquidity was about $177 million, including $89 million of cash and $87.5 million of revolver availability, with debt service coverage above 11x and net debt to adjusted EBITDA of 1.1x. Management did not provide formal next-quarter or full-year financial guidance on the call, but said it expects proceeds from pending financings to address this month’s unsecured bond maturity and support future growth.

Paul Smithers focused on the federal rescheduling change as the biggest development for the business since 2016, saying it removes 280E for qualifying medical operators and could create retroactive tax relief and faster DEA registration. He said these changes should improve operator economics, expand access to capital and create a healthier long-term environment for growth and investment. His tone was upbeat and confident, while still noting the company is prioritizing balance-sheet actions and portfolio stabilization.

David Smith emphasized capital management and the bond maturity due this month, saying the company raised $128 million year-to-date and is pursuing nearly $130 million more in financings, including a $56.5 million financing expected to fund today. He said the contemplated financings would carry a blended rate of just over 8%, and highlighted strong balance-sheet metrics: roughly $177 million of liquidity, a debt service coverage ratio above 11x and net debt to adjusted EBITDA of 1.1x. He also tied quarter results to revenue from PharmaCann and Gold Flora settlements and noted AFFO of $53.4 million, or $1.88 per share.

Analysts pressed management on how quickly the signed-but-not-yet-commenced leases will contribute to earnings, and Ben Regin said timing depends on regulatory approvals, license transfers and free-rent periods that can last from 3 months to 12 to 18 months. Questions also focused on the impact of Schedule III: Paul Smithers said medical license holders are covered now, that 280E relief should apply to qualifying medical operators, and that the broader hearing process is expected to resolve the adult-use question within about 30 days after it begins on June 29. Management also said rescheduling does not address interstate commerce or banking, and that those issues remain unresolved.