Innovative Industrial Properties (NYSE:IIPR) is a rarity in the marijuana industry. At a time when many cannabis companies are struggling to make a profit, IIP is using a highly lucrative real estate strategy to deliver handsome gains to its investors.

IIP is structured as a real estate investment trust (REIT). It acquires facilities that can be used to produce medical marijuana and leases them to state-licensed growers. It's a relatively simple and repeatable business model -- one that IIP is successfully using to build a thriving empire of cash-generating properties.

A cannabis leaf is on top of a stack of $100 bills.

Innovative Industrial Properties is the cannabis stock you're searching for. Image source: Getty Images.

As a REIT, IIP passes nearly all of its cash flows on to its shareholders via a fast-growing dividend. Since the second quarter of 2017, it increased its quarterly cash payout from $0.15 per share to $1.24. Unsurprisingly, IIP's stock price soared during this time.

IIPR Chart

IIPR data by YCharts

With more states moving to legalize marijuana, IIP has plenty of room for expansion still ahead. As it continues to serve as an important real estate partner for a U.S. cannabis industry that could generate $200 billion in annual sales by 2030, according to investment bank Stifel, IIP is poised to become a much larger company over the next decade.

So, if you're looking for a way to add a cannabis-fueled growth element to your investment portfolio, buying shares in Innovative Industrial Properties could be a great way to do so.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.