Company: IIPR
Filing Date: 2025-11-04
Form Type: 10-Q
Source: 0001677576-25-000005
Chunk: 91

Company: INNOVATIVE INDUSTRIAL PROPERTIES INC
Filing Date: 2025-11-04
Form: 10-Q
Item: Part I, Item 1
Chunk 91
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 2025, property expenses included $0.9 million and $2.3 million, respectively, of non-reimbursed expenses related to operating properties that were not leased. 

Recent Developments

Investment in IQHQ

As previously disclosed, on August 6, 2025, the Company through its Operating Partnership entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with IQHQ, Inc., a Maryland corporation (“IQHQ REIT”) and certain of IQHQ REIT’s affiliates. The Securities Purchase Agreement, together with certain exhibits thereto, set forth the terms under which the Operating Partnership agreed to: (i) purchase up to $170 million of 15.0% Series G-1 Cumulative Redeemable Preferred Stock of IQHQ REIT (the “IQHQ Preferred Stock”) at a price of $1,000 per share, together with corresponding warrants to purchase common equity units of IQHQ Holdings, LP, a Delaware limited partnership, subject to the satisfaction of certain funding milestones of the IQHQ Preferred Stock; and (ii) provide a $100 million commitment to the operating partnership of IQHQ REIT as a member of a lender syndicate under an Amended and Restated Credit 

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Agreement (the “IQHQ Credit Facility”) with an initial term of three years, extendable by an additional 12 months upon payment of an extension fee and satisfaction of certain other conditions.

On September 30, 2025, our Operating Partnership assigned its rights and obligations under the Securities Purchase Agreement to IIP Life Science Investments LLC (“IIP Life Science”), a wholly owned subsidiary of the Operating Partnership. Following the assignment, IIP Life Science completed the initial closing of the Company’s investment in preferred equity of IQHQ REIT, purchasing 5,000 shares of IQHQ Preferred Stock for $5.0 million. On October 31, 2025, the Company purchased an additional 45,000 shares of IQHQ Preferred Stock for $45.0 million, resulting in a total investment of 50,000 shares with an aggregate purchase price of $50.0 million. 

The IQHQ Preferred Stock accrues cumulative dividends comprised of (i) a 10.0% annual cash dividend and (ii) a 5.0% paid-in-kind (“PIK”) dividend, both calculated on the Base Amount (as defined in the Securities Purchase Agreement), with dividends payable quarterly in arrears. The PIK dividend rate increases by 1.25