Innovative Industrial Properties: Bull vs. Bear

Innovative Industrial Properties (NYSE: IIPR) is the largest owner of commercial marijuana properties in the United States. At last count (in May 2022) the company owned 8.1 million square feet of marijuana fields, spread out across 109 properties in 19 states.

Innovative acquires all of its property via a sale-leaseback arrangement. A marijuana grower sells their land to Innovative in order to raise cash. And Innovative turns around and leases the land back to the marijuana grower. In this manner the grower has access to funds -- which is important as much of the marijuana industry is shut off from the banking system because of federal laws.

This week, one of Innovative's renters, Kings Garden, defaulted on its rent payment. Is this the start of a wave of bad news about to hit this landlord to the pot industry? Or is it a blip on the chart? Two Fools put forth the bear and bull cases for Innovative Industrial Properties.

Source Fool.com