Innovative Industrial Properties (IIPR) reported total revenues of $76.5 million for the third quarter ended September 30, 2024, a 1.7% decrease from $77.8 million in the same period of 2023. Net income attributable to common stockholders was $39.7 million, or $1.37 per share, down from $41.256 million, or $1.45 per share, year-over-year. Adjusted Funds From Operations (AFFO) also saw a decline, reaching $64.3 million, or $2.25 per share, compared to $64.790 million, or $2.29 per share, in Q3 2023.
The revenue decrease was primarily attributed to a $3.0 million decline in contractual rent and property management fees from properties IIP regained possession of since June 2023. Additionally, a $1.3 million decline resulted from the re-classification of two sales-type leases, and $1.3 million in contractually due rent and property management fees were not collected during the quarter. These declines were partially offset by a $4.6 million increase from contractual rent escalations, lease amendments for additional improvement allowances, and new leases.
The company applied $1.4 million of security deposits for rent payments from tenants including 4Front Ventures Corp., TILT Holdings Inc., and Emerald Growth Holdings LLC. IIP also terminated its lease with Temescal Wellness of Massachusetts Holdings, LLC and regained possession of that property on September 30, 2024. The quarterly dividend of $1.90 per common share, paid on October 15, 2024, represented an annualized dividend of $7.60 per common share and an AFFO payout ratio of 84%.
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