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Rainbow Realty Group Acquires $2.3 ​Million Industrial Building In New Jersey

NEW YORK, Sept. 19, 2024 (GLOBE NEWSWIRE) -- Rainbow Realty Group IV, LLC and ​Rainbow Realty Group II, LLC (collectively, “Rainbow”), announced the acquisition of a ​9,800-square-foot industrial building in Ewing, New Jersey via sale-leaseback (the ​“Property”).

The Property was acquired all cash on September 17th, 2024. Rainbow’s total ​consideration for the property purchase, reserves and tenant improvements was up ​to $2,300,000. The first year’s rent on the 15-year lease represents an unlevered 14% ​cap rate to Rainbow. The absolute triple-net lease has 3% annual rent bumps. In the ​future Rainbow may seek leverage against the Property, to further enhance its ​unlevered returns.

The Tenant at the Property is a licensed cannabis cultivator in the state of New Jersey ​who has been occupying the Property since 2019. The Tenant has invested more than ​$1,000,000 into retrofitting the Property with high-tech cannabis cultivation ​equipment, including a brand-new power upgrade. Due to constrained supply in New ​Jersey, wholesale marijuana prices are some of the highest in the country.

Kyle Shenfeld, Rainbow Realty Group CEO, stated: “We are pleased to close another ​core real estate transaction occupied by a well-positioned cannabis company. The ​Property, located in Ewing, NJ, is suitable for a wide variety of industrial users. ​Rainbow’s Tenant – a savvy women-owned operation – has invested significant ​capital into upgrading the Property for cannabis cultivation. Due to the limited ​number of high-quality indoor cultivators in the state of New Jersey, our Tenant will ​be able to sell high-quality craft cannabis at an excellent price point.”

Rainbow Realty Group IV, LLC (“Fund IV”) is Rainbow’s fourth fund in the nascent ​market of cannabis-related real estate finance. Fund IV held its first closing in June ​and is currently earning a blended 18% cash on cash return, on an unlevered basis. ​Fund IV has funded three transactions thus far (including the Property above), with ​several more in its upcoming pipeline. Fund IV will be taking on new investors through ​the end of 2024. To learn more about Fund IV, please review the Fund IV Offering ​Information or email jack@rainbowrg.com.

About Rainbow Realty Group

Rainbow Realty Group and its affiliates have deployed $160 million in cannabis-​related retail and industrial real property throughout the United States. Rainbow ​offers sale-leaseback and mortgage financing, with an existing portfolio of 62 ​properties across 12 states. Rainbow's largest investor and operating partner, Gould ​Investors L.P., (“Gould”) has invested in the real estate industry for 64 years and ​currently manages $2B+ in assets. Gould is a significant shareholder in BRT ​Apartments and One Liberty Properties. For additional information, please visit ​rainbowrg.com

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