Innovative Industrial Properties, a leading real estate investment trust (REIT) specializing in industrial and life science properties, announced it has closed a new $100 million secured revolving credit facility with a federally regulated commercial bank. The new facility significantly enhances IIP’s financial flexibility as it continues expanding its portfolio within the life sciences sector.
The revolving credit facility, which has an initial three-year term, is secured by the company’s IQHQ investment—a major life sciences real estate holding. Borrowings under the facility will bear interest at a rate equal to the one-month Secured Overnight Financing Rate (SOFR) plus 200 basis points, or approximately 6.1% based on current rates.
The financing includes an accordion feature allowing IIP to increase borrowing capacity by up to $35 million, for a total potential commitment of $135 million, contingent upon the addition of other participating lenders. This new facility positions the company to further capitalize on attractive investment opportunities in the long-term life sciences market, leveraging strong fundamentals and stable returns.
IIP emphasized that this transaction represents a key milestone in diversifying its capital sources beyond the cannabis-focused industrial assets that originally defined its business. The life science expansion strategy is expected to reduce the company’s overall cost of capital and improve liquidity amid evolving market conditions.
KEY QUOTE:
“The successful closing of this credit facility supports our thesis that our recent investment in the life science industry should lead to both improved access to, and lower cost of, capital. With an already strong, low leveraged balance sheet, this credit facility enhances our financial flexibility and provides us with an attractive, accretive investment spread exceeding 800 basis points on our IQHQ investment, and positions us to continue to capitalize on the attractive, long-term strength of the life science industry. We appreciate the strong support we received from our banking partner for this significant commitment of capital.”
Alan Gold, Executive Chairman, Innovative Industrial Properties
