IIPR resolves PharmaCann litigation, reports new tenant defaults

Innovative Industrial Properties Inc. (NYSE: IIPR) announced it has resolved litigation with PharmaCann Inc. regarding lease defaults and reported new tenant payment issues in a portfolio update.

The real estate investment trust reached a settlement agreement with PharmaCann that includes monetary judgments for amounts owed under leases in New York, Ohio and Pennsylvania. PharmaCann must turn over the New York and Pennsylvania properties by May 20, 2026, and the Ohio property by May 26, 2026. The company stated it is in discussions with prospective tenants for all three properties.

IIPR has executed new lease agreements for three other properties previously leased to PharmaCann, including a 205,000 square foot Michigan facility in April 2025, a 58,000 square foot Massachusetts property in November 2025, and a 66,000 square foot Illinois property in March 2026.

The company also secured new tenants for three properties previously leased by Gold Flora and reached tentative agreements for four assets leased to 4Front, subject to diligence and licensing processes. These 4Front agreements are expected to take effect after receivership proceedings conclude in the third quarter of 2026.

Two tenants defaulted on March 2026 rent payments. The Cannabist Company failed to pay $0.6 million in rent for a Pennsylvania property, representing 2.7% of IIPR's total rental revenues for 2025. Battle Green Holdings defaulted on $0.8 million in rent for an Ohio property, representing 2.9% of 2025 rental revenues. IIPR plans to use security deposits to cover both missed payments.

The Cannabist Company remains current on 19 of its 20 leases with IIPR, which collectively represented 6.3% of the company's 2025 rental revenues. IIPR stated it will aggressively enforce its lease rights, potentially including eviction proceedings.

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