Innovative Industrial Properties, Inc.

Good day, everyone, and welcome to the Innovative Industrial Properties second quarter 2025 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's remarks, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. To withdraw your question, please press star then two. Please note that this event is being recorded. I would now like to turn the conference over to Eli Cantor, Director of Investor Relations. Please go ahead, sir.

Thank you for joining the call. Presenting today are Alan Gold, Executive Chairman, Paul Smithers, President and Chief Executive Officer, David Smith, Chief Financial Officer, and Ben Regan, Chief Investment Officer. Before we begin, I'd like to remind everyone that statements made during today's conference call may be deemed forward-looking statements within the meaning of the safe harbor of the Private Securities Litigation Reform Act of 1995, and actual results may differ materially due to a variety of risks, uncertainties, and other factors. Please refer to the documents filed by the company with the SEC, specifically the most recent reports on Form 10-K and 10-Q, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements. We are not obligated to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. In addition, on today's call, we will discuss certain non-GAAP financial information, such as FFO, normalized FFO, and AFFO. You can find this information together with reconciliations to the most directly comparable GAAP financial measure in our earnings release issued yesterday, as well as in our 8K filed with the SEC. I'll now hand the call over to Alan.

Thanks, Eli. Good morning, and thank you for joining our call. Yesterday, we announced our first expansion outside of the cannabis industry with a strategic investment in IQHQ, a leading private life science retail. This investment underscores our conviction in the long-term fundamentals of the life science industry and provides IIP a unique opportunity to accretively deploy capital while adding industry and tenant diversification to our portfolio and positioning us to continue driving growth and creating long-term value for our shareholders. IQHQ was founded in 2019 and has raised over $4 billion of equity capital since inception. Its current portfolio, including both operational and underdevelopment properties, totals over 5 million square feet with additional pipeline potential, all located in the leading and largest global life science markets in Boston, South San Francisco, San Diego, and the Golden Triangle in the UK. Within the overall life science real estate market, we anticipate improving fundamentals with new deliveries in 2025 trending down compared to prior years and continued deceleration and construction starts expected in the near term. In addition, life science fundraising in 2025 is on track to be its highest since 2021, further underscoring investors' confidence in the long-term fundamentals of the industry. This investment at this entry point positions us to capitalize on these long-term secular tailwinds. The total commitment of $270 million is expected to be highly accretive to AFFO, carrying a blended yield exceeding 14%. Our investment includes $100 million investment in IQHQ's revolving credit facility to be funded at closing, and future funding of up to $170 million invested in IQHQ preferred stock to be funded over time. We expect to fund these investments with a combination of cash on hand, draws from the company's revolving credit facility, and future financing activities. While we continue to evaluate investment opportunities in the cannabis industry, this investment provides complementary growth opportunities to enhance our investment pipeline, including a right-of-first offer on all future asset sales by IQ HQ, providing potential pipeline opportunities on over 5 million square feet of leading life science real estate for IIP. Our management team brings decades of experience in the life science industry, most recently in biomed reality, giving us the expertise to leverage our existing platform to drive accretive growth for our shareholders. As we continue to execute on our plan and drive value within our cannabis portfolio, we are excited to announce this return to accretive growth with our investment in IQ HQ. With that, I'll now turn the call over to Paul. Paul?