NewLake Capital Partners (NLCP) LD Micro 20th Annual Main Event Conference summary

Business model and portfolio

• Second-largest U.S. cannabis real estate owner; buys properties from or for operators, then leases them long term; collects monthly rent and pays quarterly dividends.

• Portfolio spans 35 properties in 13 states and 13 tenants: 15 cultivation facilities and 20 dispensaries.

• Collected 100% of contractual rent year to date; zero debt; AFFO payout ratio 88%; dividend yield 13%.

• Weighted-average remaining lease term nearly 12 years; portfolio weighted-average yield 13%; average annual rent escalators 2.6%.

Industry catalysts

• Medical cannabis moved to Schedule 3, which management said removes 280E tax limits for medical businesses; 50% of properties are medical and 50% are dual-use.

• Management expects adult-use rescheduling to conclude in Q4 or Q1 next year, extending tax benefits across cannabis; cited two industry companies uplisted to the NYSE after medical rescheduling.

• Hemp restrictions are set to take effect in December; operators in Ohio saw 5%-30% top-line revenue gains as sales shifted to state-legal dispensaries after a ban.

• Growth outlook rests on illicit-to-legal sales conversion, expanded Georgia and Texas medical programs, and Virginia's planned adult-use launch next year.

Growth and capital plans

• Four growth levers: contractual rent escalators, tenant-improvement funding, leasing three available properties to reduce carrying costs, and new acquisitions.

• Acquired a Kentucky dispensary in August; credit facility extended through 2029 and borrowing cost lowered 100 bps, from prime plus 1 to prime.

• Acquisitions funded with equity and internally generated revenue; management plans to use available credit over time to grow without diluting shareholders.

• Triple-net leases place operating costs and most maintenance and CapEx on tenants; transactions are signed with a lease to avoid tenancy risk, with regular property inspections.