Innovative Industrial Properties, Inc.

Faruqi & Faruqi, LLP Securities Litigation Partner James (Josh) Wilson Encourages Investors Who Suffered Losses Exceeding $75,000 In Innovative Industrial Properties To Contact Him Directly To Discuss Their Options

If you suffered losses exceeding $75,000 in Innovative Industrial Properties between February 27, 2024 and December 19, 2024 and would like to discuss your legal rights, call Faruqi & Faruqi partner Josh Wilson directly at 877-247-4292 or 212-983-9330 (Ext. 1310).

Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential claims against Innovative Industrial Properties, Inc. (“IIPR” or the “Company”) (NYSE: IIPR) and reminds investors of the March 18, 2025 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.

Faruqi & Faruqi is a leading national securities law firm with offices in New York, Pennsylvania, California and Georgia. The firm has recovered hundreds of millions of dollars for investors since its founding in 1995. See www.faruqilaw.com.

As detailed below, the complaint alleges that the Company and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose that: (1) IIPR was experiencing significant declines in rent and property-management fees in connection with certain customer leases; (2) the foregoing would likely impair the Company’s ability to maintain FFO and revenue growth; (3) accordingly, IIPR’s leasing operations were less profitable than the Company had represented to investors; and (4) as a result, the Company’s public statements were materially false and misleading at all relevant times.

On November 6, 2024, IIPR reported its financial results for the third quarter of 2024.  Among other items, IIPR reported normalized FFO per share of $2.02, missing the consensus estimate of $2.03 and declining from $2.09 in the same period in 2023.  IIPR also reported revenue of $76.5 million, missing the consensus estimate of $77.5 million and declining from $77.8 million in the same period in 2023.  IIPR stated that the year-over-year decrease was due to a $3.0 million decline in contractual rent and property management fees in the third quarter related to properties that IIPR regained possession of since June 2023; a decline of $1.3 million due to rent received but not recognized in rental revenues resulting from the re-classifications of two sales-type leases beginning January 1, 2024; and $1.3 million of contractually due rent and property management fees that were not collected during the current quarter.

On this news, IIPR’s stock price fell $12.93 per share, or 10.51%, to close at $110.07 per share on November 7, 2024.

Then, on December 20, 2024, IIPR announced that on the previous day, PharmaCann Inc. (“PharmaCann”), the tenant for eleven properties that IIPR owns—and the revenues from which represented 17% of IIPR’s total rental revenues for the three and nine months ended September 30, 2024—defaulted on its obligations to pay rent for the month of December under six of its eleven leases (the “Leases”), for properties located in Illinois, Massachusetts, Michigan, New York, Ohio and Pennsylvania.  December rent, including base rent, property management fees, and estimated tax and insurance payments, totaled $4.2 million for these six properties.  Further, IIPR stated that it applied security deposits held by IIPR pursuant to these Leases for the payment in full of the defaulted rent, in addition to late penalties and interest.  Finally, the Company revealed that “although PharmaCann paid rent in full under the remaining five Leases totaling $90,000 for the month of December, as a result of cross-default provisions contained in each of the Leases, on December 19, 2024, PharmaCann also defaulted on its obligations under these five Leases, as a result of the non-payment of rent on the other six Leases.”

On this news, IIPR’s stock price fell $21.68 per share, or 22.73%, to close at $73.66 per share on December 20, 2024.

The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not. 

Faruqi & Faruqi, LLP also encourages anyone with information regarding Innovative Industrial  Properties’ conduct to contact the firm, including whistleblowers, former employees, shareholders and others.

To learn more about the Innovative Industrial Properties class action, go to www.faruqilaw.com/IIPR or call Faruqi & Faruqi partner Josh Wilson directly at 877-247-4292 or 212-983-9330 (Ext. 1310).

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