Kafkaesque Sale of IIPR: Koa Wealth’s Cold Exit

The world of finance is a strange and unsettling place, much like a labyrinth whose walls seem to close in with every turn. This reality was once again affirmed as Koa Wealth Management, LLC, with unsettling finality, liquidated its entire position in Innovative Industrial Properties (IIPR), marking an irreversible decision that echoes through the cold, empty halls of bureaucracy. The sale of 68,221 shares-valued at a precise yet arbitrary $3.77 million, based on the third quarter’s average price-has left the fund with a vacuum, a silent emptiness where once there was a vested interest, now rendered meaningless.

What happened

In a filing dated October 28, 2025, to the U.S. Securities and Exchange Commission, Koa Wealth Management, LLC solemnly announced the complete liquidation of its stake in Innovative Industrial Properties. The shares, once firmly held in the fund’s portfolio, were dispensed with in an action that bore the hallmarks of finality. At the close of Q3 2025, the fund held not a single share of the company. A stark zero. And with this, the name of Innovative Industrial Properties fades into the distant past of financial history, leaving no trace of its former 3.0% share in the fund’s Assets Under Management (AUM).

What else to know

Innovative Industrial Properties has been expunged from the fund’s portfolio, leaving behind a barren landscape where once it had been a player, however minor. As of the date the fund’s holdings were last tallied-September 30, 2025-what was once a source of potential has become, in the eyes of Koa Wealth, simply an encumbrance. The major holdings that remain include the stalwarts of the portfolio: BRK-B at $19.58 million, AAPL at $15.30 million, and others. They seem stable, perhaps even comforting in their predictability, much like old friends who have not yet outlived their usefulness.

And yet, one must ask, is stability anything more than a trap? With Innovative Industrial Properties now absent, the fund appears to have turned away from the cannabis-focused REIT-an investment with a tantalizing promise of high returns, yet fraught with risks that make one uneasy at the very thought. Its dividend yield of 14.46%, shining like a distant beacon of income, now sits amid the bleakness of a performance that has descended 25.5% in value this year. Such figures are not mere statistics; they are the cold, unforgiving truth of the market’s harsh realities.

Company Overview

Metric	Value
Price (as of October 29, 2025)	$49.63
Dividend Yield	14.46%
YTD Performance	-25.5%

Company Snapshot

It owns and leases properties designed for a very specific purpose-cannabis cultivation and processing, a niche so tightly defined that it seems almost absurd in its exclusivity.
Operates as a Real Estate Investment Trust (REIT), providing these properties to a select group of tenants who have been licensed by the state to participate in the increasingly regulated world of medical-use cannabis.
The target tenants are those experienced in the intricacies of state-level cannabis operations, operating within a highly controlled, and highly uncertain, market.
Its focus remains fixed on a sector plagued by the unpredictability of regulation, market forces, and the unpredictable whims of public opinion.

Foolish take

The decision to sever ties with Innovative Industrial Properties, taken by Koa Wealth Management, was not made lightly, nor was it an isolated one. It reflects a world in which the burden of volatility becomes unbearable, and where the strictures of financial responsibility can never be overlooked. With shares down over 25% in 2025 alone, the company faces the cruel weight of economic forces-rising interest rates, declining property values, and tightening financing conditions. In the face of such challenges, the decision to liquidate becomes a reasonable one, even if it feels more like a surrender than a triumph.

For all its pain, Innovative Industrial Properties is not without merit. It continues to fulfill a unique, albeit increasingly troubled, role in the medical cannabis market. Its high dividend yield-14.46%-remains a siren song for dividend hunters, though it seems tinged with the bitterness of skepticism. The market’s doubt in the company’s long-term viability is palpable, and yet, it continues to operate, its long-term leases providing a steady stream of cash flow in a world of unpredictability. Koa’s exit from this particular holding hints at a cautious move, perhaps towards more stable, diversified assets, leaving behind the troubled landscape of cannabis REITs. And yet, it’s hard not to wonder if, in the cold analysis of this decision, a lost opportunity lies just beyond reach, waiting like an unopened door in a bureaucratic maze.

Glossary

Assets Under Management (AUM): A measure of the total market value of assets managed by a fund or firm on behalf of its clients. It is, in many ways, a symbol of power, but also a reminder of the often arbitrary nature of financial wealth.
Liquidated: A term that brings a chill to the spine-an entire position sold off, leaving behind only the quiet void of what once was.
Quarterly Average Price: A number that seems to hold meaning, yet can be rendered meaningless as soon as it is invoked, a mere approximation of something far more elusive.
Dividend Yield: The percentage of a company’s stock price paid out as dividends, which is often an enticing figure that promises much, but delivers little when the market turns cold.
Real Estate Investment Trust (REIT): A company that owns or finances income-producing real estate, with the disturbing duty of distributing most of its income to shareholders-both a gift and a burden.
Stake: A symbol of ownership, yet one that can feel more like a weight around one’s neck as the market shifts.
Portfolio: A collection of investments, but in truth, perhaps nothing more than a collection of burdens.
Medical-use Cannabis Sector: A sector both regulated and rife with uncertainty-where legality and profitability seem as volatile as the market itself.

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2025-10-30 00:18