United Energy Corp (UNRG)

[DWillie]

Take a look at IIPR and what they've done. A lot of their buys are in the 15-50M range. I would expect the average property with a large greenhouse operation would go for around 25-30M. And these exist in every single state with medical or recreational MJ because multi-state retailers are not allowed to transport across state lines. So they have real estate for growing and retailing in every state they operate in. It's a lot of cash tied up in hard assets that these companies are starting to realize they can better use elsewhere if they sell it and lease it back.

Innovative Industrial Properties acquires freestanding industrial and retail properties from state-licensed medical-use cannabis operators. The properties are then leased back under long-term, absolute net lease agreements. We focus on well-capitalized companies that have successfully gone through the rigorous state licensing process and have been granted a license in the state where the property is located.

We act as a source of capital to these state-licensed operators by acquiring and leasing back their real estate. This allows for the opportunity to redeploy the proceeds into core operations, yielding a higher return than they would otherwise get from owning real estate.

We work with licensed operators across all product types: cultivation, processing, distribution and retail.

Our sample sale leaseback terms:

Targeted deal size - $5 million to $30+ million
Additional expansion capital available
Lease term – 10 to 20 years
Initial base rent – 10% to 16% on total investment (based on property underwriting)
Annual base rent escalations – 3% to 4.5%
Security deposit and corporate guaranty based on credit underwriting
Transaction timeline – closing 30 to 60 days from signed purchase and sale agreement