The global cannabis boom is fueling demand for facilities that can be used to grow and process marijuana. Real estate investment trust (REIT) Innovative Industrial Properties (NYSE:IIPR) was created to help investors profit from this surging demand for cannabis cultivation sites. The company is rapidly expanding its real estate portfolio, leasing its properties to state-licensed medical marijuana growers and passing on the profits to its shareholders.

IIP announced on Oct. 22 that it acquired two properties in Joliet and Kankakee, Illinois, which together comprise about 90,000 square feet of industrial space, for $32.8 million, excluding transaction costs. IIP is leasing the properties on a triple-net basis to Cresco Labs (OTC:CRLBF), which will continue to operate them as regulated cannabis cultivation and processing facilities. IIP will also reimburse Cresco for up to $13.8 million in tenant improvements.

"Cresco has created a tremendously valuable footprint in the cannabis industry throughout their states of operation," IIP CEO Paul Smithers said in a press release. "We look forward to our long-term real estate partnership, and continuing to support them in their strategic growth for many years to come."

In addition to helping investors profit from the cannabis craze, IIP is also helping medical-use cannabis companies expand faster than they otherwise could. By acquiring and leasing back their properties, IIP provides these businesses with valuable capital that they can then allocate to higher-return expansion initiatives. In essence, IIP takes care of their real estate needs, and its tenants focus on what they do best, such as growing marijuana.

"With the continued expansion of Illinois' medical-use cannabis program and the introduction of the regulated adult-use cannabis program next year, we are very well-positioned, with state-of-the-art cultivation and processing facilities and support from IIP, to continue to enhance productive capacity of these facilities, to play a key role in the continued strong growth of the Illinois regulated cannabis industry," Cresco Co-Founder and President Joe Caltabiano said.

A cannabis leaf made out of $100 bills.

Innovative Industrial Properties is a vital source of capital for cannabis producers. Image source: Getty Images.

IIP also announced on Oct. 23 that it acquired a 120,000-square-foot property in Quincy, Florida, from Trulieve Cannabis (OTC:TCNNF) for $17 million, excluding transaction costs. Like Cresco, Trulieve signed a triple-net lease with IIP and will use the facility for medical cannabis cultivation.

IIP previously completed a sale-leaseback deal with Trulieve for an industrial site in Holyoke, Massachusetts, back in July.

"It is great to team with IIP again on this transaction, providing us the real estate capital to continue to expand our capacity in one of the largest and most dynamic medical cannabis markets in the United States," Trulieve CEO Kim Rivers said. "These newly developed cultivation facilities provide us with the optimal controlled environments to continue to deliver the highest quality products to patients throughout the state of Florida."

With most states' legalized cannabis markets still in their early stages, investors can expect Innovative Industrial Properties to strike more real estate deals with companies like Cresco Labs and Trulieve in the weeks and months ahead.

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.