Company: IIPR
Filing Date: 2025-02-26
Form Type: 424B5
Source: 0001104659-25-017454
Chunk: 131

Company: INNOVATIVE INDUSTRIAL PROPERTIES INC
Filing Date: 2025-02-26
Form: 424B5
Chunk 131
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 assets to ensure
that we comply with those requirements, but we cannot assure you that we will be successful in this effort. No independent appraisals
will be obtained to support our estimates of and conclusions as to the value of our assets and securities, or in many cases, the real
estate collateral for the mortgage loans that support our assets. Moreover, the values of some assets may not be susceptible to a precise
determination. As a result, no assurance can be given that the Service will not contend that our ownership of securities and other assets
violates one or more of the asset tests applicable to REITs.

Distribution Requirements

Each taxable year, we must distribute dividends,
other than capital gain dividends and deemed distributions of retained capital gain, to our stockholders in an aggregate amount at least
equal to:

| · | the sum of: |

| · | 90% of our REIT taxable income computed without regard        
 to the dividends paid deduction and our net capital gain, and |
| · | 90% of our after-tax net income, if any, from foreclosure     
 property, minus                                               |

| · | the sum of certain items of non-cash 
 income.                              |

We must make such distributions in the taxable
year to which they relate, or in the following taxable year if either (i) we declare the distribution before we timely file our
U.S. federal income tax return for the year and pay the distribution on or before the first regular dividend payment date after such
declaration or (ii) we declare the distribution in October, November or December of the taxable year, payable to stockholders
of record on a specified day in any such month, and we actually pay the dividend before the end of January of the following year.
The distributions under clause (i) are taxable to the stockholders in the year in which paid, and the distributions in clause (ii) are
treated as paid on December 31 of the prior taxable year. In both instances, these distributions relate to our prior taxable year
for purposes of the 90% distribution requirement.

In order for distributions to be counted as satisfying
the annual distribution requirements for REITs other than “publicly offered” REITs, and to provide a REIT-level tax deduction
for such REITs, the distributions must not be a “preferential dividend.” A distribution is not a preferential dividend if
the distribution is (i) pro-rata among all outstanding shares within a particular class and (ii)