{
  "docId": "019dd923-622c-750b-8b9a-e29456cbe117",
  "docSlug": "6acbd8e96867",
  "documentTitle": "Innovative Industrial Properties, Inc. (IIPR)",
  "authorId": "62_Grizzly_Research",
  "authorName": "Grizzly Reports",
  "documentKindSlug": "research-note",
  "documentKindLabel": "Research note",
  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2020-04-09 00:00:00",
  "orientation": "portrait",
  "aspectRatio": 0.77272725,
  "pageNumber": 11,
  "pageCount": 36,
  "prevPage": 10,
  "nextPage": 12,
  "slideType": "expose_contradiction",
  "function": "expose_contradiction",
  "density": "overcrowded",
  "nDataPoints": 5,
  "notes": "Includes a photographic site visit as evidence of the contradiction between disclosed construction schedules and reality.",
  "elementsJson": [
    "paragraph",
    "headline_text",
    "photo"
  ],
  "metadataConfidence": 1,
  "imagePath": null,
  "slideHref": "/slides/019dd923-622c-750b-8b9a-e29456cbe117/11",
  "deckHref": "/decks/019dd923-622c-750b-8b9a-e29456cbe117",
  "deckJsonHref": "/decks/019dd923-622c-750b-8b9a-e29456cbe117.json",
  "deckAnchorHref": "/decks/019dd923-622c-750b-8b9a-e29456cbe117#slide-11",
  "components": [
    {
      "bbox": null,
      "kind": "callout",
      "text": "We visited the site on 03/20/2020. To our astonishment, the property was still in very early age of construction.",
      "attrs": null,
      "subkind": null,
      "toolName": "Visual emphasis",
      "toolSlug": "visual-emphasis",
      "confidence": null,
      "componentId": "019dd953-70f8-7007-94e1-4d42770df9f2",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.35,
        "w": 0.78,
        "x": 0.11,
        "y": 0.49
      },
      "kind": "image",
      "text": "Site visit photo showing construction status",
      "attrs": null,
      "subkind": "photo",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "9f941523-4c3b-4be8-a41e-afe6c7ddc758",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.02,
        "w": 0.78,
        "x": 0.11,
        "y": 0.41
      },
      "kind": "paragraph",
      "text": "The monthly Base Rent for the first twelve (12) months of the Term of the Lease is $260,000.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "0f9e83ac-9bf9-4ce0-b384-7d7b9ac44d07",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.03,
        "w": 0.78,
        "x": 0.11,
        "y": 0.37
      },
      "kind": "paragraph",
      "text": "We have identified the address to be Lot 4 Life Science Drive, Scott Technology Park, Olyphant, PA, corresponding to parcel 071.04-010-004.12",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "1074a09e-0924-4539-b941-82d80938bf01",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.07,
        "w": 0.78,
        "x": 0.11,
        "y": 0.16
      },
      "kind": "paragraph",
      "text": "In this section we examine the latest two of the four transactions between IIPR and PharmaCann to establish why we suspect IIPR is constructing sham transactions to keep its tenant solvent. Again, a comprehensive analysis on all leases can be found in the Appendix, which is uploaded as a separate document on our website.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "794d45a3-fd39-4cdd-90e3-3fe87fdc458b",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.05,
        "w": 0.78,
        "x": 0.11,
        "y": 0.31
      },
      "kind": "paragraph",
      "text": "On August 8th, 2019, IIPR purchased property from PharmaCann for initially $942,000, offering reimbursement for improvement up to $29.1M for a total investment of $30.0 million (excluding transaction costs).",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "83135886-17c1-4a79-a80d-819017e4771f",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.03,
        "w": 0.78,
        "x": 0.11,
        "y": 0.85
      },
      "kind": "paragraph",
      "text": "This should come as a huge surprise to investors. According to the schedule IIPR disclosed, construction was planned to finish in November of 2019.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "8ed10925-1a78-41ab-ac7c-0c9969c7a6e3",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.07,
        "w": 0.78,
        "x": 0.11,
        "y": 0.09
      },
      "kind": "paragraph",
      "text": "In PharmaCann’s specific case we think this scheme has naturally come to an end. We consulted with industry experts and believe that as of 2019, PharmaCann had ran out of properties to sell to IIPR in sale-leaseback transactions, and also don’t have sufficient cash to pursue new projects.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "92e43841-7187-48bf-a15a-04bf65265c2a",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.03,
        "w": 0.78,
        "x": 0.11,
        "y": 0.44
      },
      "kind": "paragraph",
      "text": "We visited the site on 03/20/2020. To our astonishment, the property was still in very early age of construction.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "df725696-f9eb-4a84-8f5d-49e4aa61e1f7",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.03,
        "w": 0.5,
        "x": 0.11,
        "y": 0.28
      },
      "kind": "title",
      "text": "2.1.2 Scott Township PA – $260,000 a month for Empty Land?",
      "attrs": null,
      "subkind": "headline",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "3eb91ba0-d60c-41aa-af0a-0eac02317965",
      "frameworkName": null,
      "frameworkSlug": null
    }
  ],
  "metrics": [],
  "tools": [
    {
      "name": "Before-After-Bridge",
      "slug": "before-after-bridge",
      "agent": "Storyteller",
      "layer": "slide",
      "matchId": "378f1e98-032e-4609-ade0-b8a581ad1dff",
      "evidence": "The property was still in very early age of construction.",
      "confidence": 0.5
    }
  ],
  "frameworks": [
    {
      "name": "fraud-exposure",
      "slug": null,
      "matchId": "3e6ae60b-e1a4-4066-b0cb-c52d4da44ca0",
      "evidence": "The slide explicitly claims to expose 'sham transactions' and provides evidence of a discrepancy between disclosed construction schedules and site reality.",
      "confidence": 0.9
    }
  ],
  "arcBeats": [
    {
      "to": 18,
      "from": 10,
      "beatId": "364af6ab-9a95-435c-b829-610042107d6d",
      "arcName": "Overcoming the Monster",
      "arcSlug": "overcoming-monster",
      "beatName": "Expose Contradiction",
      "beatSlug": null,
      "evidence": "The report highlights contradictions in IIPR's business dealings, such as suspicious transactions and financial troubles of its tenants.",
      "position": 1,
      "confidence": 0.8,
      "parentBeatName": null,
      "parentBeatSlug": null
    }
  ],
  "loops": [
    {
      "to": 18,
      "from": 9,
      "name": "Zoom In",
      "slug": "06-zoom-in",
      "bestFor": "Technical deep-dives, case studies, detailed analysis",
      "matchId": "6427974c-8712-4c50-958a-10078d43f3b9",
      "evidence": "The report zooms in on specific tenants, such as PharmaCann and Vireo, to highlight their financial troubles.",
      "position": 0,
      "objective": "What are the financial troubles of IIPR's tenants?",
      "structure": "The Big Picture -> Key Area of Focus -> Specific Detail -> Implication",
      "confidence": 0.7,
      "description": "Start broad, then progressively focus on specific details that prove your point"
    }
  ],
  "imagePathAlt": null,
  "thumbSrc": null,
  "thumbSrcAlt": null,
  "locked": true
}