The REIT cannabis initiative will soon become a publicly traded real estate investment.
Subversive Real Estate’s merger with Inception REIT is part of a $ 183 million transaction to turn a special investment vehicle into real estate investment confidence, giving it tax benefits and more capital, Bloomberg News said.
The transaction is expected to close later this month, making Inception the second publicly traded REIT cannabis following the success of Innovative Industrial Properties.
The REIT structure will help cannabis companies that need cash, as well as investors who want to invest in the growing cannabis sector without having to manage assets.
“We will unlock capital for operators,” Subversive CEO Richard Acosta told Bloomberg.
Innovative industrial real estate, founded in 2016, has performed better than other commercial real estate sectors since the onset of the pandemic, as dispensaries were able to operate during outages, while other facilities – such as restaurants or cinemas – did not.
However, it remains to be seen how the REIT structure can share the risk. If marijuana becomes legal at the federal level, companies may not have to operate facilities in every state, as is now required of them, and cultivation land and processing facilities in some states may become unnecessary. [Bloomberg] – Akiko Matsuda