Benzinga | Jan 4, 2021 12:15PM EST

Power REIT Reports Purchase Of 2 Properties Totaling 4.21 Acres In Crowley County, Colorado

Power REIT (AMEX:PW) ("Power REIT" or the "Trust") today announced that it acquired two properties with a total of 4.21 acres in Crowley County, Colorado (the "Property") through a wholly owned subsidiary ("PropCo"). The Property is strategically located in a part of southern Colorado that offers a very favorable business setting and climate for greenhouse cultivation.

As part of the transaction, Power REIT has agreed to fund the immediate construction of an approximately 21,732 square foot greenhouse and processing facility for approximately $1.84 million including the land acquisition cost.

Concurrent with the acquisition, PropCo entered into a 20-year "triple-net" lease with The Grail Project LLC ("Grail Project") which will operate a cannabis cultivation facility. The lease requires Grail Project to pay all property related expenses including maintenance, insurance and taxes. After the initial 20-year term, Grail Projects' lease provides four, five-year renewal options. The lease also has a personal guarantee from the owner of Grail Project.

The lease requires Grail Project to maintain a medical marijuana license and to operate in accordance with all Colorado and municipal regulations and prohibits retail sales of its products from the property. The lease is structured to provide straight-line annual rent of approximately $350,000 which represents an unleveraged CORE FFO yield of approximately 19% on the invested capital. The transaction increases Power REIT's CORE FFO on a run rate basis by approximately $0.18 per share.