IIP Begins Public Sale of Series B Preferred Stock to Fund Alewife Loan

Innovative Industrial Properties, Inc. (IIPR ) announced on October 7, 2026 that it has commenced a public offering of its Series B Cumulative Redeemable Preferred Stock, and the company said it intends to use the net proceeds to fund all or a portion of its remaining unfunded commitment under a previously announced mezzanine loan investment in the life science industry, with any remaining net proceeds directed to investments consistent with its investment strategy and to general corporate purposes.

No market currently exists for the new preferred series, and the company plans to file an application to list it on the New York Stock Exchange under the symbol “IIPR Pr B,” according to the company’s announcement. The company expects to grant the underwriters a 30-day option to purchase additional shares to cover overallotments.

Stifel is acting as active bookrunner for the offering, with A.G.P./Alliance Global Partners (GLP ), Huntington Capital Markets and Oppenheimer & Co. acting as passive bookrunners and Academy Securities, Clear Street, Compass Point, Roberts & Ryan, Roth Capital Partners and Wolfe Capital Markets and Advisory acting as co-managers. The offering is being made only by means of a written prospectus under an effective automatic shelf registration statement on Form S-3 previously filed with the U.S. Securities and Exchange Commission on February 21, 2025, and the company filed a preliminary prospectus supplement for the offering that is dated October 7, 2026.

Terms of the Series B Preferred Stock

The Series B Preferred Stock carries a liquidation preference of $25.00 per share. The number of shares to be offered and the dividend rate were left blank in the preliminary prospectus supplement, which is subject to completion.

Under the filed terms, holders will be entitled to cumulative cash dividends payable quarterly in arrears on January 15, April 15, July 15 and October 15 of each year, commencing January 15, 2027, with the first dividend pro-rated from the original issue date through January 14, 2027. Dividends will be computed on the basis of a 360-day year consisting of twelve 30-day months and will accrue whether or not the company has earnings, whether or not funds are legally available for payment and whether or not the dividends are authorized and declared.

The shares will rank on parity with the company’s 9.00% Series A Cumulative Redeemable Preferred Stock and senior to its common stock with respect to dividend rights and rights upon liquidation, dissolution or winding up, and they will rank junior in right of payment to the company’s debt, including its 6.00% exchangeable senior notes due 2029. Upon any voluntary or involuntary liquidation, holders of the Series B shares would be entitled to $25.00 per share plus accrued but unpaid dividends before any distribution to holders of common stock. No class or series of the company’s capital stock ranked senior to the Series B Preferred Stock as of the date of the prospectus supplement.

The Series B Preferred Stock has no stated maturity and is not subject to mandatory redemption or any sinking fund. The company generally may not redeem the shares before a 2031 date left blank in the preliminary document, except in limited circumstances relating to its ability to qualify as a real estate investment trust or under a special optional redemption within 120 days after a Change of Control. On or after that 2031 date, the company may redeem the shares at its option, in whole or in part, for $25.00 per share plus accrued but unpaid dividends, upon not fewer than 30 and not more than 60 days’ written notice.

Upon a Change of Control, each holder will have the right to convert some or all of such holder’s Series B shares into common stock, subject to a Share Cap, unless the company has provided notice of its election to redeem the shares. Holders will generally have no voting rights, except that if dividends are in arrears for six or more quarterly periods, whether or not consecutive, holders of the Series B Preferred Stock, voting together with any parity preferred stock carrying like rights, will be entitled to elect two additional directors until all unpaid dividends have been paid. The affirmative vote or consent of at least two-thirds of the outstanding Series B shares is required for the company to authorize or issue capital stock ranking senior to the Series B Preferred Stock or to amend its charter in a manner that materially and adversely affects the series.

Articles supplementary establishing the series will generally prohibit any person from owning more than 9.8% of the outstanding Series B shares by value or number, whichever is more restrictive, a restriction intended, among other purposes, to help the company maintain its REIT qualification. The stock has not been rated, and the prospectus supplement states that investing in it involves a high degree of risk, including risks associated with non-rated securities. Continental Stock Transfer & Trust Company is the transfer agent and registrar. The underwriters expect to deliver the shares through The Depository Trust Company on the fifth business day following pricing. If the NYSE application is approved, trading is expected to commence within 30 days after the initial issuance.

Use of Proceeds and the Alewife Mezzanine Loan

The company will contribute the net proceeds of the offering to its operating partnership, IIP Operating Partnership, LP, as an additional capital contribution. The operating partnership intends to use the proceeds to fund all or a portion of the remaining unfunded commitment under the Alewife Mezzanine Loan and to use any remainder for investments consistent with the company’s strategy, for working capital and for other general corporate purposes.

On September 28, 2026, IIP Life Science Investments II LLC, a wholly owned subsidiary of the operating partnership, entered into the Sixth Amendment to the Alewife mezzanine loan agreement, increasing the facility’s maximum principal amount by $267.0 million to $400.0 million. IIP Life Science II committed up to $245.0 million of the increase, and the existing mezzanine lender committed up to $22.0 million. Also on September 28, 2026, IIP Life Science II funded an initial advance of approximately $111.0 million, the proceeds of which were used to repay in full the borrower’s existing $85.0 million bridge loan, together with accrued interest, fees, a minimum return payment and other amounts due.

The loan funds construction and development of Alewife Park, a master-planned, transit-oriented life science campus on approximately 27 acres in West Cambridge, Massachusetts. The borrower, IQHQ-Alewife Holdings, LLC, is a wholly owned subsidiary of IQHQ, LP, the operating partnership of IQHQ, Inc. The loan bears interest at a per annum rate equal to the greater of 14% or the applicable interest rate benchmark, initially one-month Term SOFR, plus a 9.0% spread, matures on February 9, 2028 with a one-year extension option, is secured by pledges of limited liability company interests rather than a mortgage on the property, and carries completion, environmental and recourse guaranties from IQHQ, LP.

IIP Life Science II holds a right of first offer to purchase, finance or refinance the Alewife Park property once its funded total under the loan equals or exceeds $155.0 million. Under the Co-Lender Agreement entered into on September 28, 2026, the company also has an option, but not the obligation, to purchase up to approximately $155.0 million in maximum principal amount of the existing mezzanine lender’s notes.

The offering follows a charter amendment that became effective September 25, 2026, increasing the company’s authorized shares from 100,000,000 to 175,000,000, with authorized common stock rising from 50,000,000 to 100,000,000 shares and authorized preferred stock from 50,000,000 to 75,000,000 shares. As of September 30, 2026, the company had 27,570,861 shares of common stock and 5,666,082 shares of Series A Preferred Stock issued and outstanding, and it offers and sells Series A shares from time to time through an at-the-market offering program. As of June 30, 2026, the company had approximately $623.6 million in aggregate principal of indebtedness outstanding, consisting of $221.1 million secured under its term loans, revolving credit facility and life science credit facility and approximately $402.5 million unsecured under the exchangeable notes.

Innovative Industrial Properties is an internally managed real estate investment trust focused on the acquisition, ownership and management of specialized properties leased to experienced, state-licensed operators for their regulated cannabis facilities and on financial investments in the life science industry. The company was incorporated in Maryland on June 15, 2016, conducts its business through an umbrella partnership REIT structure and has elected to be taxed as a REIT beginning with its taxable year ended December 31, 2017.