v3.26.3
Debt
 9 Months Ended
Sep. 30, 2026
Debt Disclosure [Abstract]  
Debt Debt
The following table details the gross principal amounts and total net carrying value of our debt instruments (in thousands):
September 30, 2026December 31, 2025
Exchangeable notes$402,500 $— 
Revolving credit facilities187,500 102,500 
Term loans121,561 — 
Notes due 2026— 291,215 
Total gross principal amount of debt instruments
711,561 393,715 
Less: Unamortized debt issuance costs
(15,602)(613)
Carrying value of debt instruments$695,959 $393,102 
The following table details the cash and non-cash interest expense included within interest expense on the consolidated statement of income related to our debt instruments (in thousands):
For the Three Months Ended September 30,For the Nine Months Ended September 30,
2026202520262025
Exchangeable notes
Cash coupon$6,038 $— $7,044 $— 
Amortization of issuance cost1,086 — 1,230 — 
Revolving credit facilities
Cash coupon1,819 75 5,804 75 
Amortization of issuance cost227 117 658 349 
Term loans
Cash coupon2,495 — 4,150 — 
Amortization of issuance cost232 — 913 — 
Notes due 2026
Cash coupon— $4,004 6,387 12,089 
Amortization of issuance cost— 368 601 1,082 
Gross interest expense11,897 4,564 26,787 13,595 
Less: capitalized interest(77)(39)(188)(126)
Interest expense$11,820 $4,525 $26,599 $13,469 
Exchangeable Notes, net
On June 15, 2026, our Operating Partnership issued $402.5 million of 6.00% exchangeable senior notes due 2029 (the “Exchangeable Notes”) in a private offering, including the exercise in full of the initial purchasers' option to purchase additional notes. The Exchangeable Notes are senior unsecured obligations of our Operating Partnership, are fully and unconditionally guaranteed by us and are exchangeable by the holder for cash, shares of our common stock, or a combination of cash and shares of our common stock, at our Operating Partnership's option, at any time prior to the close of business on the second scheduled trading day immediately preceding the stated maturity date. The initial exchange rate for the Exchangeable Notes is 14.4113 shares of our common stock per $1,000 principal amount of Exchangeable Notes and the initial exchange price is $69.39 per share of our common stock. The initial exchange rate and initial exchange price are subject to adjustment for customary anti-dilution provisions and certain other specified events. The exchange rate and exchange price remained unchanged as of September 30, 2026. The Exchangeable Notes bear interest at a rate of 6.00% per annum, payable semi-annually in arrears on June 15 and December 15 of each year, beginning December 15, 2026 until maturity on June 15, 2029. Our Operating Partnership does not have the right to redeem the Exchangeable Notes prior to maturity, but may be required to repurchase the Exchangeable Notes from holders under customary fundamental change events.
The Company incurred approximately $14.0 million of issuance costs in connection with the issuance of the Exchangeable Notes, inclusive of $2.5 million of additional advisory fees paid in the three months ended September 30, 2026 in connection with the original issuance. The amortization of the debt issuance costs is recognized as a non-cash component of interest expense over the term of the Exchangeable Notes. The effective interest rate, including the amortization of debt issuance costs, was 7.54%.
Term Loans, net
During the nine months ended September 30, 2026, the Company entered into several new term loan facilities with various lenders. These term loans are secured by, among other things, certain mortgages and security interests in the real and personal properties, certain assignments of leases and rents, and certain deposit accounts maintained with the lenders.
The following table summarizes the key terms, outstanding principal balances and carrying values of term loans outstanding as of September 30, 2026 (dollar amounts in thousands):
Term LoanClosing DateOriginal PrincipalPrincipal OutstandingNet Carrying ValueInterest RateEffective Interest RateMaturity DatePayment type
Term Loan #1Apr-26$20,000 $19,854 $19,474 9.00%10.18 %Apr-29Principal and interest
Term Loan #2(1)
May-2656,500 49,730 48,472 
SOFR + 5%
9.84 %May-29Interest only
Term Loan #3May-2644,860 44,692 43,759 6.67%7.57 %Jun-31Principal and interest
Term Loan #5Jun-267,300 7,285 7,005 7.50%8.51 %Jun-31Principal and interest
Total$128,660 $121,561 $118,710 
(1)The loan has two, one-year extension options that may extend the maturity through May 2031. SOFR is subject to a floor of 3.75%. On August 5, 2026 we repaid $6.8 million of the loan, reducing the outstanding principal balance to $49.7 million as of September 30, 2026. The loan also requires the Company to maintain a minimum net worth of $120.0 million and liquid assets with a market value of at least $12.0 million. As of September 30, 2026, the Company was in compliance with these covenants.
The Company had no Term Loans outstanding as of December 31, 2025.
Revolving Credit Facilities
Revolving Credit Facility
In October 2023, our Operating Partnership entered into a loan and security agreement (the “Loan Agreement”) with a federally regulated commercial bank, as lender and as agent for lenders that become party thereto from time to time, which was originally scheduled to mature on October 23, 2026. The Loan Agreement initially provided $50.0 million in aggregate commitments for secured revolving loans (the “Revolving Credit Facility”), the availability of which is based on a borrowing base consisting of real properties owned by subsidiaries (the “Subsidiary Guarantors”) of the Operating Partnership that satisfy eligibility criteria set forth in the Loan Agreement. The obligations of the Operating Partnership under the Loan Agreement are guaranteed by the Company and the Subsidiary Guarantors, and are secured by certain assets of the Company. Borrowings under the Revolving Credit Facility bear interest at a variable rate based on the greater of the prime rate and an applicable margin based on deposits with the participating bank(s) and a stipulated interest rate. At September 30, 2026, the interest rate was 9.0%. The Revolving Credit Facility is subject to an unused line of credit fee, calculated in accordance with the Loan Agreement. The Loan Agreement is subject to certain liquidity and operating covenants and includes customary representations and warranties, affirmative and negative covenants and events of default. The Loan Agreement also allows the Operating Partnership, subject to the satisfaction of certain conditions, to request additional revolving loan commitments up to a specified amount. In November 2024, our Operating Partnership entered into an amendment to the Loan Agreement, pursuant to which the aggregate commitments under the Revolving Credit Facility were increased from $50.0 million to $87.5 million. As of September 30, 2026, the outstanding borrowings under the Revolving Credit Facility were $87.5 million. On October 21, 2026, our Operating Partnership entered into an amendment to the Loan Agreement, which extended the maturity date of the Revolving Credit Facility from October 23, 2026 to January 21, 2027. See Note 15 "Subsequent Events" for additional details.
IIP Life Science Credit Facility
In October 2025, our Operating Partnership and IIP Life Science Investments LLC ("IIP Life Science") entered into a loan agreement with a federally regulated commercial bank, as agent for the lenders that become party thereto from time to time (the “IIP Life Science Credit Facility”). Under the IIP Life Science Credit Facility, our Operating Partnership has a revolving line of credit available up to $100.0 million until the maturity date on October 3, 2028. The IIP Life Science Credit Facility includes an accordion feature under which the revolving line of credit may be increased up to an aggregate of $135.0 million, under certain conditions, including obtaining additional lender commitments. The availability of credit at any given time under the IIP Life Science Credit Facility is subject to, among other things, the amount of collateral available and a borrowing base formula based upon the value of eligible investments in certain securities and an eligible loan receivable. All obligations under the IIP Life Science Credit Facility are secured by substantial assets of the loan parties, including the Company’s investment through IIP Life Science in the IQHQ Preferred Stock, the IQHQ Warrants, and the IQHQ Credit Facility. Borrowings under the IIP Life Science Credit Facility bear interest on the outstanding daily balance at a rate of interest per annum equal to the greater of (i) the one-month Secured Overnight Financing Rate ("SOFR"), as administered by CME Group Benchmark Administration, plus 2.0% and (ii) 6.10%. As of September 30, 2026, the outstanding borrowings under our IIP Life Science Credit Facility were $100.0 million.
The IIP Life Science Credit Facility contains a liquidity covenant and a debt service coverage ratio covenant, which requires that the ratio of the Company’s consolidated EBITDA to debt service costs not be less than 2.0 to 1.0, measured as of the end of each fiscal quarter. The Company was in compliance with those covenants as of September 30, 2026.
Notes due 2026, net
In May 2021, our Operating Partnership issued $300.0 million aggregate principal amount of its 5.50% Senior Notes due 2026 (the “Notes due 2026”). In connection with the issuance of the Notes due 2026, we recorded $6.8 million of issuance costs, which were amortized using the effective interest method and recognized as non-cash interest expense over the term of the Notes due 2026. The effective interest rate including amortization of issuance costs was 6.03%.
In February 2025, we made early partial repayments at a discount totaling $8.7 million on the Notes due 2026, reducing the principal balance by $8.8 million. Following the partial repayment, all other terms and conditions of the debt agreement remained unchanged.
In April 2026, we made early partial repayments at a discount totaling $9.1 million on the Notes due 2026, reducing the principal balance by $9.1 million from $291.2 million to $282.1 million. Following the partial repayment, all other terms and conditions of the debt agreement remained unchanged.
The Notes due 2026 matured on May 25, 2026 and were repaid in full.
The following table summarizes the contractual principal payments on our outstanding indebtedness as of September 30, 2026 (in thousands):
YearAmount
2026 (three months ending December 31)$87,798 
20271,238 
2028101,321 
2029472,140 
20301,036 
Thereafter48,028 
Total$711,561