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]