Power REIT Buys Colorado Greenhouse Property In Lease-Back Deal With The Apotheke

Real estate investment trust Power REIT PW has purchased a 4.3-acre property in Ordway, Colorado.

The property has been leased by The Apotheke, a Minority Woman-Owned Business run by dispensary operator Viviana Fernandez.

Power REIT is set to financially support the 21,558 square-foot property — which includes a greenhouse and processing facility — with $1.8 million.

At the same time, PropCo signed a 20-year triple-net lease with Apotheke, which runs the cannabis cultivation facility. The Apotheke is obliged to fund all property connected costs, such as maintenance, insurance, and taxes.

Furthermore, it has to keep its medical marijuana license and run its business following all the regional regulations.

When the original 20-year term expires, companies are left with two, five-year renewal options.

This acquisition boost Power REIT’s CORE FFO on a run-rate basis by around 9 cents per share. Without any other financing activities in the future, this transaction combined with other recent greenhouse-connected transactions is projected to raise CORE FFO per share to around $2.44 per year on a yearly run-rate basis.

“I am excited to expand my operations and shift my operating focus to Crowley County because I believe greenhouses are the future for cannabis cultivation and this was a perfect union between us and Power REIT, which is focused on greenhouse facilities,” Fernandez said in a statement.  

David Lesser, Power REIT’s Chairman and CEO, said the deal is proof of Power REIT’s commitment to ESG (environment, social, and governance), and it backs the company’s investment principle of investing in sustainable real estate while supporting a minority woman-owned business.