Core Insights - The cannabis sector is evolving as capital markets reopen, leading investors to focus on cannabis real estate investment trusts (REITs) for more predictable revenue during uncertain times [1][17] - January 2026 is a critical month for investors to reassess income opportunities and monitor tenant performance updates [1][8] Group 1: Innovative Industrial Properties (IIPR) - IIPR is the largest cannabis-focused REIT in the U.S., specializing in acquiring industrial cannabis properties and leasing them back to licensed operators [2][4] - The portfolio includes over 100 properties across nearly 20 states, primarily cultivation and processing facilities, with long lease terms supporting recurring revenue visibility [4][6] - IIPR has maintained positive operating cash flow despite tenant liquidity stress, with funds from operations sufficient to support dividends [6][7] Group 2: Chicago Atlantic Real Estate Finance (REFI) - REFI operates as a mortgage-focused cannabis REIT, providing senior secured loans to cannabis operators, generating income primarily through interest payments [8][10] - The company targets operators in limited-license states, which often support stronger pricing and margins, and has shown consistent earnings strength with stable net interest income [10][11] - REFI maintains available lending capacity, allowing continued loan origination, but borrower performance is critical for earnings stability [12] Group 3: NewLake Capital Partners (NLCP) - NLCP is a smaller cannabis property REIT that acquires cannabis-related real estate through sale-leasebacks, with a portfolio that includes both dispensaries and cultivation facilities [13][15] - The company owns over 30 properties across roughly a dozen states, focusing on secondary and emerging cannabis markets, which can create opportunities but also add tenant risk [15][16] - Financially, NLCP has a conservative balance sheet with stable revenue year over year, and funds from operations continue to cover dividends [16][17] Group 4: Overall Market Insights - Cannabis REITs present a different risk profile compared to traditional cannabis stocks, focusing on income generation rather than retail sales growth [17] - Tenant health remains the primary risk across the sector, with IIPR, REFI, and NLCP serving different investor objectives, highlighting the importance of diversification [17]

Core Insights - Cannabis real estate investment trusts (REITs) provide a unique investment opportunity by collecting rent or interest rather than selling cannabis, thus reducing direct operational risk [1] - As December 2025 approaches, Innovative Industrial Properties, NewLake Capital Partners, and Chicago Atlantic Real Estate Finance are highlighted as key investment options, each with distinct risk and income profiles [1] Innovative Industrial Properties (IIPR) - IIPR is one of the earliest cannabis-focused REITs, acquiring specialized industrial facilities leased to licensed cannabis operators, thus avoiding direct exposure to cannabis sales [2] - As of late 2025, IIPR owned over 110 properties covering approximately nine million rentable square feet, with no company-run dispensary locations [2] - Financially, IIPR generated revenue above $60 million in its most recent quarter, with net income remaining positive despite tenant-related challenges, and adjusted funds from operations (FFO) comfortably covering dividends [5] NewLake Capital Partners (NLCP) - NLCP specializes in sale-leaseback transactions with operators, often under triple-net lease terms, which enhances cash flow visibility [6] - As of late 2025, NLCP's portfolio included 34 properties, comprising 19 dispensaries and 15 cultivation facilities, providing clearer retail exposure [6] - NLCP maintained steady financial performance in 2025, with positive AFFO covering dividends, and emphasized liquidity and disciplined underwriting [8] Chicago Atlantic Real Estate Finance (REFI) - REFI operates by providing loans to cannabis operators secured by real estate collateral, earning interest income instead of rent [9] - As of late 2025, REFI worked with over 25 portfolio companies, providing diversification across operators and regions [9] - Financially, REFI delivered strong yield metrics, with net interest income as the primary revenue driver, and distributable earnings comfortably covering dividends [11] Final Thoughts - The cannabis REIT sector continues to evolve, with each structure offering distinct advantages and risks: IIPR for scale and diversification, NLCP for direct dispensary exposure, and REFI for high yields through secured lending [12]