- REFI is a mortgage REIT that lends to state-licensed operators in the cannabis industry.
- It is currently trading at 1.1x P/B and yields 9% (in-line with other mREITs with better risk profiles).
- If current legal conditions persist, REFI will not be able to take title to the underlying real estate if a default occurs. Thus, providing no margin of safety to investors.
- If legal conditions do change, REFI will find it harder to compete against the larger, more traditional and established players who will be free to move into the space.
- Insiders have been buying but still not enough to justify an investment.
For further details see:
Chicago Atlantic Real Estate Finance: Cannabis Lender Stuck Between A Rock And A Hard Place