Innovative Industrial Properties (IIPR) reported total revenues of $62.9 million for the second quarter ended June 30, 2025, a substantial 21% decrease from $79.8 million in the same period of 2024. Net income attributable to common stockholders fell to $25.1 million, or $0.86 per diluted share, from $41.7 million, or $1.44 per diluted share, year-over-year. Adjusted Funds From Operations (AFFO) also saw a significant decline to $48.4 million, or $1.71 per share, from $65.5 million, or $2.29 per share, in Q2 2024.
The significant revenue decrease was primarily driven by tenant defaults totaling $15.8 million from PharmaCann, Gold Flora, TILT, and 4Front. Additional factors included a $1.3 million decrease from vacated or sold properties, a $3.9 million decrease from a one-time disposition-contingent lease termination fee collected in Q2 2024, and a $0.6 million decrease in tenant reimbursement revenue. These declines were partially offset by $1.6 million from new acquisitions, $1.5 million from new leases on existing properties, and $1.6 million from contractual rent escalations.
Despite the financial headwinds, IIPR maintained a strong balance sheet with over $190 million in liquidity and a conservative 11% debt-to-gross assets ratio as of June 30, 2025. The company also repurchased 371,538 shares of common stock for $20.1 million at a weighted average price of $54.09 per share year-to-date Q2 2025. The dividend of $1.90 per common share was declared on June 13, 2025, and paid on July 15, 2025.
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