Real Estate Archives - Green Market Report

Debra BorchardtApril 12, 2021


Real estate is one of the more difficult aspects of the cannabis industry. Securing a license is tough but getting your location is even tougher. Each state has different regulations and restrictions, which combined with unique real estate markets makes finding and securing property essential. It’s an expensive endeavor and one in which traditional mortgages aren’t typically an option. 

This presentation will focus on the New England and New York area cannabis real estate markets. It will cover the following states: Maine, Vermont, New Hampshire, Connecticut, Massachusetts, New York, New Jersey, and Pennsylvania. 

Many of the states that have gone fully legal – meaning legalized both medical use and adult-use cannabis often have opt-out clauses for municipalities. This means that in some areas if a town or village decides against allowing cannabis stores or facilities in its location, that puts even more demand for locations in the municipalities that approve cannabis businesses. 

Growth in the Northeast

The Northeast cannabis industry has been expanding at a blistering pace. In 2018, there were only 187 dispensaries across nine states. Fast forward to March 2021 and you see the number has jumped to 424. Of this 424, only Massachusetts and Maine have adult-use products for the sale, the rest are entirely medical marijuana. These numbers are expected to jump even higher as states like New Jersey and New York go fully legal. “It plays out in typically New England ways – Maine has been really friendly, Portland was very competitive,” said MMLG Managing Director Brian Lauvray. 


Dispensary/Retailers 2018-YTD 2021
State 2018 2019 2020 3/2021
CT 18 18 18 18
MA 65 98 161 206
ME 8 8 20 23
NH 4 5 5 5
NJ 6 8 13 14
NY 30 38 38 38
PA 47 76 104 110
RI 3 3 3 3
VT 6 6 7 7
Total 187 260 369 424
Copyright © 2021 by CNB Media LLC dba Cannabiz Media
Source: Cannabiz Media License Database


One area in Massachusetts that saw a dispensary boom is Great Barrington. This lovely town in the heart of the Berkshire mountains is a center for tourism. Skiing in the winter, plus hiking, biking and camping in the summer. There’s a bustling summer performance calendar as well that brings lots of baby boomers up to watch dance and theatre groups. It’s the perfect place to locate a dispensary and the town initially opened its doors. 

That sparked a flood of dispensaries and now the town, despite having no cap on stores is saying they have enough, thank you. The population has less than 7,000 people but 5 dispensaries. Springfield in the middle of the state has attracted several stores and then Boston and its surrounding suburbs has numerous dispensaries, but there are big pockets of the state where there are zero dispensaries. Mostly due to the lack of a major highway or tourist center.

Capitalizing on the Asset

Cannabis companies continue to struggle with getting big mortgages for buildings. They continue to use the capital raised in order to fund a store or facility purchase. The later, the company can sell the property to a REIT or real estate investment trust and then lease it back. Innovative Industrial Properties or IIP is a popular REIT that has done this so often, that it is the leader in the space. 

Let’s look at Massachusetts again. Almost every big player in the space has sold a property to IIP. (The investment figure is in thousands and the data is from the IIP 2020 annual report.)


Rentable Sq. Ft Investment
PharmaCann MA Massachusetts May 31, 2018 58,000 30,500
Holistic MA Massachusetts July 12, 2018 55,000 14,750
Trulieve MA Massachusetts July 26, 2019 150,000 43,500
Ascend MA Massachusetts April 2, 2020 199,000 33,775
Cresco MA Massachusetts June 30, 2020 118,000 8,904
4Front MA Massachusetts December 17, 2020 67,000 15,500

In 2020, IIP closed on the acquisition of a property in Massachusetts, which was approximately 118,000 square feet of industrial space in the aggregate. The purchase price for the property was approximately $7.8 million (excluding transaction costs). IIP also entered into a long-term, triple-net lease agreement for the property with a wholly owned subsidiary of Cresco Labs Inc. (Cresco), which intends to operate the property as a regulated cannabis cultivation, processing and dispensing facility upon completion of redevelopment. Cresco is expected to complete additional tenant improvements for the property, for which IIP has agreed to provide reimbursement of up to $21.0 million. Assuming full reimbursement for the tenant improvements, IIP’s total investment in the property will be approximately $28.8 million.(Data from IIP’s annual 2020 report)

Going back a couple of years in 2018, closed on the acquisition of a property located at 96 Palmer Road in Monson, Massachusetts, which comprises approximately 55,000 square feet of industrial space situated on approximately 5.4 acres. The purchase price for the property was $12.75 million. Concurrent with the closing of the purchase, the Company entered into a long-term, triple-net lease agreement with Holistic Industries, Inc. (“Holistic”), which intends to continue to operate the property as medical-use cannabis cultivation and processing facility in accordance with Massachusetts medical-use cannabis regulations. 

Newcomers – New Jersey & New York

Massachusetts looks like an old-timer compared to the soon-to-be fully legal states of New Jersey & New York. Both markets are expected to be sizable and both are only legal for medical marijuana at this time. Both have recently decided to legalize adult-use cannabis and New Jersey could begin sales in 2021, while New York will begin sales on April 1 2022. Both states are also famous for expensive real estate. 

Any new entrant to the market is best served by hiring a consultant that knows the ins and outs of navigating the red tape that comes with cannabis. The competition for licenses will be fierce. Brian Lauray from MMLG consultants said, “New York & New Jersey will be a battle royale from an application standpoint. Borough commissioners and aldermen and who you know.” Plus, both states allow municipalities to opt out of the cannabis industry. “In New Jersey, a few desirable municipalities have indicated they are open for business – like Jersey City,” said Lauvray. “It’s a really interesting market – everyone wants in. But there is a lot of demand and not a lot of supply. It will come down to the operators that have the money and can tweak many levers” 

IIP has also been busy in the New York market buying properties despite the relatively small size of the number of stores and facilities. New York is a limited license state that only gave 10 operators the opportunity to be in the industry. That will change with full legalization, but those 10 operators have all struggled with the medical-only nature of the state. It had a very restricted list of conditions in order to get the license and sales have been dismal versus the amount of money invested. So it was no surprise to see some companies selling off real estate to IIP in order to get some cash in the kitty.  

IIP said in a securities filing that in December 2019, one of its properties in New York accounted for 6% of our net real estate held for investment. In December 2020, the company said it amended its lease and entered into a development agreement with PharmaCann at one of our New York properties, making available $31.0 million in construction funding at the property. “Assuming full payment of the construction funding, our total investment in the property will be $61.0 million. As of December 31, 2020, we incurred approximately $70,000 of the construction costs, of which none was funded.”


Rentable Sq. Ft Investment
Curaleaf NJ   New Jersey July 13, 2020 111,000 18,940
Columbia Care NJ Portfolio   New Jersey July 16, 2020 54,000 13,033
PharmaCann NY   New York December 19, 2016 127,000 30,000
Vireo NY   New York October 23, 2017 40,000 6,717

In New Jersey, the Columbia Care parcel is actually two properties and IIP said that Columbia Care was expected to redevelop one of the properties and IIP would reimburse them $1.6 million. Curaleaf was redeveloping its building with a reimbursement of up to $29.5. IIP said  $20 million was spent on redevelopment costs and IIP funded $13.4 million of that. Both New Jersey and New York give cannabis companies the best of both worlds. Each state has urban dense population locations and then long-term agricultural areas. In upstate New York, much of this agricultural land is economically depressed as well and welcomes large-scale grow facilities despite the smell and light pollution. 


Pennsylvania is a medical-only state at this time, although there seems to be incredible pressure on the state to go fully legal as its neighbors New York and New Jersey. In the last 12 months, Pennsylvania medical cannabis sales totaled $910 million. Medical cannabis sales have grown steadily in the past 13 months, starting at $40M in January 2020 and ending at close to $98M in January 2021. The state’s stores have grown from 47 in 2018 to 110 in 2021 for just a medical market. The size of the spaces is growing as well. While Canadian companies may have overbuilt facilities, Pennsylvania operators are clamoring for more. In December Ayr Strategies closed on the purchase of CannTech PA for $57 million. This acquisition included a 143,000 sq. ft. cultivation and processing facility on 13 acres.


Rentable Sq. Ft Investment
Jushi PA Pennsylvania April 6, 2018 89,000 13,381
Maitri PA Pennsylvania April 24, 2019 51,000 21,402
Green Leaf PA Pennsylvania May 20, 2019 266,000 13,592
PharmaCann PA Pennsylvania August 9, 2019 54,000 25,730
GTI PA Pennsylvania November 12, 2019 148,000 39,600
Curaleaf PA Pennsylvania December 20, 2019 72,000 25,749
Holistic PA Pennsylvania June 10, 2020 108,000 15,007

Parallel is working to set up a 120,000-square-foot grow facility in a space owned by The Buncher Co. in the Chateau neighborhood of the North Side, working in partnership with the University of Pittsburgh through its venture called Goodblends PA. The company said that the venture needed a big building for a range of uses that will include growing and processing medical cannabis products, conducting research, training employees as well as meeting basic distribution and warehousing demands. A fully legal state could see an additional boost in real estate. At this time, Pennsylvania is IIP’s second-largest market for a property with rents accounting for 15.7% of rental revenue. Seven properties with 788,000 rentable square feet bring in $18.3 million a year (as of December 2020). 


An example of the effect on a fully legal state can be seen in the recent increase in stores in Maine, which jumped from 8 in 2019 to 23 in 2021. Propco., a subsidiary of New York-based real estate investment trust Power REIT acquired a three-acre property in York County, Maine. The sales price was $400,000. That property currently houses an under-construction, 32,800-square-foot cannabis cultivation facility. It also has a 2,800 square foot processing/distribution building with construction recently completed. PropCo. Said it will fund the construction of an additional 9,900 square feet of processing space and the renovation of an existing 2,738 square foot building at the recently acquired property. The completion of construction on the new property is targeted for Summer 2021.

The combined properties are expected to be one of the largest cannabis greenhouse cultivation and processing/distribution properties in the state of Maine upon completion. David Lesser, Power REIT’s Chairman and CEO said that it’s not easy to raise capital for large-size facilities despite all the talk. He also noted this his REIT is focused on greenhouse cultivation facilities. 


The remaining states are relatively smaller parts of the real estate story in the Northeast. Connecticut has four producers that account for 18 dispensaries and facilities. Vermont has seven, New Hampshire has five and Rhode Island has three. This week a bill to legalize marijuana in Connecticut was approved by a key committee on Tuesday—but it “remains a work in progress,” the chairman said. The legislation is said to be backed by the governor and includes a series of new social equity provisions. A week ago, Marijuana Moment reported a pair of Rhode Island Senate committees held a joint hearing on two marijuana legalization proposals—including one proposed by the governor—as well as several bills to reform the state’s existing medical cannabis program. In late 2020, Vermont’s governor allowed a legalization law to take effect without his signature. However, it may be some time before actual legal sales can begin as decisions around licensing have yet to be decided. 


Ultimately, the real estate side of cannabis seems to be a solid choice. Lesser said that so far in cannabis if tenants have trouble making the rent, it often gets worked out. Either new investors come in or the company is acquired, but the situation is typically resolved. IIP has noted that its rents are on time as well. In October 2019, a court-appointed a receiver of the tenant at its Los Angeles, California property. That tenant subsequently defaulted on its lease payments to us for all of 2020. It had been leased to Vertical in southern California, in which Vertical made partial payments of contractual rent due.

The purchase price for the southern California portfolio was approximately $17.3 million.  Then Holistic the cannabis operations from the tenant, which had been in receivership. Holistic closed on this transaction and then quickly executed a long-term, triple-net lease with IIP for the entire property. Assuming full reimbursement for the redevelopment of the property, IIP’s total investment in the property will be $24.0 million. The company did say that for some or all of 2021, it expected that many of its tenants would continue to incur losses as their expenses increase in connection with the expansion of their operations and that they have made and will continue to make rent payments to us from proceeds from the sale of the applicable property or cash on hand, and not funds from operations.IIP says it has not provided deferrals of any rent obligations to any tenant since July 1, 2020.

In Closing

The New England market holds a great deal of promise for the cannabis industry. The pandemic has caused a huge disruption in traditional retail for many of these economies. Lockdowns caused a spike in online shopping causing many brick & mortar retailers to close up, presenting opportunities for dispensaries. While rural land values have risen as remote working created an opportunity for urban dwellers to relocate to more rural settings. Once depressed towns have seen new life, so the days of cheap big acreage in remote locations have declined. It’s still relatively early in this cycle for cannabis industries and the picture is sure to change as rules regulations get decided and then perhaps tweaked again. 

Debra BorchardtDecember 23, 2020


GrowGeneration Corp . (NASDAQ: GRWG) can’t seem to stop growing and said it is buying Southern California -based Canopy Crop Management and its complete portfolio of products, including the Power SI brand of silicic acid-enriched fertilizers. The company did not disclose how much it paid for Canopy Crop. It is the second acquisition in Southern California this month and the third acquisition in the state since November.

Canopy Crop Management was founded in 2019 and is recognized as the industry’s leading silicic acid company. Power SI will continue to be sold through Canopy Crop Management to all hydroponic retail stores including Grow Generation’s 39 locations.

“Private label expansion has become a strategic priority for GrowGen, and a key component of our long-term revenue generation plan,” said Michael Salaman , GrowGen’s President and Co-Founder. “We are proud to bring Canopy Crop Management and its founder Rex Gill under our umbrella. Rex brings his unique technologies and proprietary products to GrowGen and will be instrumental in leading private label product development within the nutrient and additive space.”

GrowGen’s Growth

Since 2014, GrowGen has acquired 34 stores and opened 16 new stores. The company has identified Ohio, Illinois, Pennsylvania, New York, New Jersey, Massachusetts and Missouri as new markets where it plans to open new operations.  On August 10, 2020 it acquired the assets of Benzakry Family Corp, d/b/a Emerald City Garden, in Concord, Ca. On October 12, 2020, the company acquired the assets of Hydroponics Depot, LLC, a single store located in Phoenix, Arizona. On October 20, 2020, the company acquired the assets of Big Green Tomato, a two-store chain in Battle Creek and Taylor, Michigan. On November 17, 2020, the company acquired the assets of The GrowBiz, which we believe is the third-largest chain of hydroponic garden centers in the United States, with four stores in California and one store in Oregon. In connection with the GrowBiz acquisition, Ross Haley, the founder of The GrowBiz and the former CEO of Hawthorne Gardening Company, a Division of Scott’s Miracle-Gro, joined the Company as a senior strategic advisor.

“I started Canopy Crop Management with the goal of providing the highest-quality formulations, and I’m fortunate to find a partner like GrowGen, one of the most trusted names in hydroponic and organic gardening,” said Gill, Canopy Crop Management’s CEO. “I look forward to creating new and innovative silicic acid formulas and organic pesticides and fungicides that are much more cost-effective than what is currently on the market.”


Debra BorchardtNovember 4, 2020


Innovative Industrial Properties, Inc. (IIP)(NYSE: IIPR) reported total revenues of approximately $34.3 million for the third quarter ending September 30, 2020. This was a 197% increase from the prior year’s third quarter. It also beat the Yahoo Finance average analyst estimate for revenue of $29.63 million. The stock rose over 8% ahead of the company’s earnings to lately trade at $133.

IIP recorded net income available to common stockholders of approximately $18.9 million for the quarter, or $0.86 per diluted share, which beat the Yahoo Finance estimate for $0.78. The adjusted funds from operations (AFFO) were approximately $27.9 million, or $1.28 per diluted share. Net income available to common stockholders and AFFO increased by 205% and 192% from the prior year’s third quarter, respectively.

IIP said that it had approximately $161.1 million in cash and cash equivalents and approximately $451.2 million in short-term investments, totaling approximately $612.3 million. The company said it had no debt, other than approximately $143.7 million of unsecured debt, consisting solely of 3.75% exchangeable senior notes maturing in 2024, representing a fixed cash interest obligation of approximately $5.4 million annually, or approximately $1.3 million quarterly.

IIP paid a quarterly dividend of $1.17 per share on October 15, 2020 to common stockholders of record as of September 30, 2020, representing an approximately 10% increase over the second quarter 2020’s dividend and a 50% increase over the third quarter 2019’s dividend.

COVID Rent Update

IIP has said during the first quarter earnings release, that it worked with three of its 22 tenants to provide temporary rent deferrals, structured to apply a portion of the security deposit IIP holds under each lease to pay April rent in full, defer rent for May and June in full, and provide for the pro rata repayment of the security deposit and deferred rent over an 18 month time period starting July 1. The company said that all three tenants paid rent in full for each of July, August, September and October, including pro rata repayments of the security deposit and deferred rent.

IIP also said that it collected 100% of contractual rent due for each of the months of July, August, September and October 2020 across IIP’s total portfolio (other than the tenant at IIP’s Los Angeles, California property that is in receivership), and has not executed rent deferrals for any additional tenants, other than the three tenants described above.

IIP Is Up To 63 Properties

As of November 4, 2020, IIP said it owned 63 properties located in Arizona, California, Colorado, Florida, Illinois, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, North Dakota, Ohio, Pennsylvania and Virginia, totaling approximately 5.0 million rentable square feet (including approximately 1.7 million rentable square feet under development/redevelopment), which were 99.3% leased (based on square footage) with a weighted-average remaining lease term of approximately 16.1 years.

IIP has raised total net proceeds of over $1.4 billion from all of its capital raising activities to date, after deducting underwriters’ discounts and commissions and offering expenses, and had invested approximately $908.4 million in the aggregate (excluding transaction costs) and had committed an additional approximately $273.5 million to reimburse certain tenants and sellers for completion of construction and tenant improvements at IIP’s properties. These statistics do not include up to approximately $7.2 million that may be funded in the future pursuant to IIP’s lease with a tenant at one of IIP’s Massachusetts properties, as the tenant at that property may not elect to have IIP disburse those funds to the tenant and pay IIP the corresponding base rent on those funds. These statistics also treat IIP’s Los Angeles, California property as not leased, due to the tenant being in receivership and its ongoing default in its obligation to pay rent at that location.

StaffJuly 22, 2020


As the pandemic stretches into more months, dispensaries are realizing that this might not be a temporary situation. Slapping up some plastic sheets isn’t a solution that will work for the long-term and it just doesn’t look nice. One company has incorporated new safety design measures in its dispensaries and it seems that these local level efforts could set a trend nationwide.

Led by the Guadagnino family (a family-owned business), Keystone Canna Remedies (KCR) is an MMJ dispensary chain in Pennsylvania that currently has 3 locations – Allentown, Bethlehem, and Stroudsburg (the Poconos). Its third dispensary in Stroudsburg, PA has included features in its design of the space by architect Ryan Welty of RGW Architecture, LLC to make sure both patients and employees are safe.

Since many medical marijuana patients are already dealing with immunocompromised conditions, it is even more important to protect them. The patients need to feel safe if they are leaving their homes to meet with a professional or get medicine. 

KCR Stroudsburg’s design and policy measures included the following measures:

  • The efficient use of space to expedite patient flow
  • Tempered glass partitions separating patients from sale counters
  • Quartz countertops, which boast anti-microbial properties
  • Physical distancing markers indicating appropriate spacing throughout indoor and outdoor waiting areas
  • Pharmacy consultation rooms designed to accommodate 6ft distancing
  •  Pre-order options
  • Designated parking area to accommodate curbside transactions if needed
  • Patient limits within indoor waiting and point of sale areas
  • PPE requirements for all patients and staff (facemasks and gloves), which will be provided for those without

The cannabis industry is accustomed to making adjustments as rules and regulations are frequently changed. However, in this case, most dispensaries took it upon themselves to adapt to a new normal. In KCR’s case, during the height of the pandemic, it moved all patient transactions out of the dispensary buildings and into the parking lots to maximize social distancing. It moved staff around to fill areas of need.  Some employees were tasked with being “runners” between the patient/caregiver in their parked car and counter staff.

Glass shields were installed to separate patients and staff at both the reception desk and the point of sale counters. Social distancing efforts inside the dispensary include signs and physical distancing markers which serve as reminders, and limited patient counts in our waiting area and our sales area.

In Closing

These measures may have been enacted as a response to a deadly virus, but it really does make sense to protect medical marijuana patients as much as possible. It is likely that such efforts will remain in place long after the COVID-19 threat passes. If this virus could be so deadly, there is no doubt more viruses will be in our future.




StaffJuly 20, 2020


Columbia Care (OTCQX: CCHWF) sold two of its properties in New Jersey for $12.4 million to Innovative Industrial Properties, Inc. (IIP) (NYSE: IIPR). Columbia Care will then rent the two properties which include an industrial building comprising approximately 50,000 square feet and a retail location comprising approximately 4,000 square feet.

Columbia Care will continue to operate the retail property as a regulated medical-use cannabis dispensary and the industrial property as a regulated medical-use cannabis cultivation and processing facility. Columbia Care is expected to complete improvements to the industrial property and IIP has agreed to provide reimbursement of up to $1.6 million. This brings IIP’s total investment in the two properties to approximately $14.0 million if all the improvement money is reimbursed.

“Columbia Care is one of the preeminent cannabis operators in the United States, and we are thrilled to introduce them as a new tenant partner,” said Paul Smithers, President and Chief Executive Officer of Innovative Industrial Properties, Inc. “As one of the largest cannabis operators, Columbia Care is dedicated to providing the highest quality products and services to patients and customers, and we look forward to supporting them as a long-term real estate capital partner in New Jersey, including providing the additional real estate capital for further enhancements to their cultivation and processing facility.”

Columbia Care in New Jersey

Columbia Care is one of only three operators licensed to dispense medical cannabis in the southern region of New Jersey. In June, the company announced the opening of a dispensary location and produced its first harvest this month at its cultivation and processing facility. New Jersey classified medical cannabis dispensaries as “essential,” allowing them to remain open during the coronavirus pandemic, while implementing additional safety and social distancing protocols to protect the health of patient customers and employees. Last month, the New Jersey Department of Health also enacted a waiver that allows licensed operators to provide home delivery of medical cannabis products to patients.

Nicholas Vita, CEO of Columbia Care said, “Partnering with IIP provides Columbia Care with access to nondilutive capital that offers flexibility and provides us with the ability to continue to build and expand our cultivation, manufacturing, and retail capabilities in the markets that matter most.”

The dispensary in Vineland NJ will be supported by the company’s 50,000 sq. ft. cultivation and manufacturing facility, which will supply both the dispensary as well as Columbia Care’s wholesale operations in the state. Adhering to both local and state guidelines for social distancing, patients have access to curbside and express pickup options as well as Columbia Care’s innovative Virtual.Care portal, providing the industry’s most complete virtual shopping experience.


As of July 20, 2020, IIP owned 61 properties located in Arizona, California, Colorado, Florida, Illinois, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, Nevada, North Dakota, Ohio, Pennsylvania and Virginia, totaling approximately 4.5 million rentable square feet (including approximately 1.5 million rentable square feet under development/redevelopment), which were 99.2% leased (based on square footage) with a weighted-average remaining lease term of approximately 16.1 years. As of July 20, 2020, IIP had invested approximately $820.4 million in the aggregate (excluding transaction costs) and had committed an additional approximately $213.3 million to reimburse certain tenants and sellers for completion of construction and tenant improvements at IIP’s properties. .

Debra BorchardtJuly 1, 2020


Cresco Labs Inc. and Innovative Industrial Properties, Inc. (IIP) have closed on the acquisition of a property in Massachusetts with a leaseback agreement. The property is approximately 118,000 square feet of industrial space and the deal is valued at $7.8 million.

Cresco is a true leader in quality, customer experience, and patient care in its core markets, and we are pleased to further expand our long-term real estate partnership with them in Massachusetts,” said Paul Smithers, President and Chief Executive Officer of IIP. “The Massachusetts regulated cannabis industry is still in its early stages, and is emerging as one of the strongest medical and adult-use cannabis markets on the East Coast. Our transaction with Cresco represents our fifth property acquisition in Massachusetts, and we are firmly committed to being a strong real estate partner to the industry here for many years to come.”

Cresco Labs has agreed to a long-term, triple-net lease agreement for the property, which it plans to operate as regulated cannabis cultivation, processing and dispensing facility upon completion of redevelopment. Cresco said it is expected to complete additional tenant improvements for the property, for which IIP has agreed to provide reimbursement of up to $21 million. Assuming full reimbursement for the tenant improvements, IIP’s total investment in the property will be approximately $28.8 million.

A String Of IIP Deals

Debra BorchardtJune 4, 2020


Grassroots Cannabis has sold two facilities it operated in North Dakota to Scythian Real Estate. Scythian purchased the properties from Grassroots Cannabis for $3.4M. Grassroots is going to lease back the properties. Grassroots Cannabis will continue to operate both North Dakota locations under the name Herbology, offering high-quality medical marijuana products including flower, concentrates, tinctures, vape pens and topicals, as well as one-on-one patient consulting.

“This sale-and-leaseback agreement with Scythian represents a non-dilutive capital solution for Grassroots Cannabis as we expand our retail operations,” said Steven Weisman, Chief Strategy Officer and Co-founder of Grassroots Cannabis.

Curaleaf (OTC:CURLF)  announced it was acquiring Grassroots in 2019, but the deal has yet to close. In May, Curaleaf said it is still working through state approvals and hopes to close by the end of the second quarter.

Joseph Lusardi, Chief Executive Officer of Curaleaf said in the company’s recent earnings release, “We expect the pending completion of our purchase of Grassroots, the largest private vertically integrated multi-state cannabis operator, to affirm our position as the world’s largest cannabis company by both revenue and operating presence.”

Scythian Deal

The acquisition includes a recently renovated 4,500-square-foot facility located at 310 US-2 in Devils Lake and a newly constructed 4,995-square-foot facility located at 318 24th St. East in Dickinson.

“Scythian is committed to working with cannabis operators like Grassroots Cannabis that have a proven track record of success,” said Randy Roberts, Partner at Scythian. “Both of these locations are well-positioned to support the long-term growth of Scythian’s portfolio as we continue to identify opportunities with highly sophisticated operators in quality markets.”

Scythian’s investment fund is currently valued at nearly $40 million with 18 assets under management, including various locations operated by The Green Solution in Colorado. The firm is raising an additional $25 million in capital to fulfill an existing acquisition pipeline across multiple states.

Acreage Holdings has announced early in April it was closing the North Dakota dispensary. The North Dakota location operated under Acreage’s “Botanist” banner — reopened as Pure Dakota Health, according to the state’s Division of Medical Marijuana.

Debra BorchardtMay 7, 2020


Cannabis REIT Innovative Industrial Properties, Inc.  (NYSE:IIPR) reported its results for the first quarter ending March 31, 2020, with total revenues of approximately $21.1 million. This was a 210% increase from the prior year’s first quarter. Innovative Industrial also delivered a net income of approximately $11.5 million or $0.72 per diluted share.

The adjusted funds from operations (AFFO) were approximately $17.8 million, or $1.12 per diluted share. Net income available to common stockholders and AFFO increased by 249% and 236% from the prior year’s first quarter, respectively. The company paid a quarterly dividend of $1.00 per share on April 15, 2020, which increased approximately 122% increase over the first quarter of 2019’s dividend.

“One of the pillars of our business strategy has consistently been a conservative, flexible balance sheet, and we believe we are exceptionally well-positioned to not only weather this unprecedented health crisis and economic disruption but to continue to make real estate investments on a long-term basis with best-in-class tenant operators,” said Alan Gold, Executive Chairman of IIP. “We remain steadfast in our support of this industry and its bright long-term future and are working every day through this crisis with our tenant partners toward continuing to build a tremendous future forward of growth and strength for many years to come. When we overcome this crisis through the collective ingenuity of our top medical professionals and researchers, the regulated cannabis industry will continue to thrive and be one of the top drivers of growth and good jobs across the country.”

COVID Rent Deferrals

While cannabis was deemed an essential service in many states, social distancing was still required. This makes working in a grow facility a challenging prospect. IIP said it has had conversations with each of its tenants in March and April over the situation. As a result, the company said that it is providing temporary rent deferrals for three of its 21 tenants. The decision was to apply a portion of the security deposit IIP holds under each lease to pay April rent in full, defer rent for May and June in full, and provide for the pro-rata repayment of the security deposit and deferred rent over an 18 month time period starting July 1.

That means a total of $743,000 of security deposits that IIP holds in cash were applied to the payment of rent for April, and a total of approximately $1.5 million in rent was deferred for May and June. The total of this amount, $2.3 million, represents approximately 3% of IIP’s total revenues as reported for the three months ended March 31, 2020, annualized.

Current Portfolio

As of May 6, 2020, IIP said it owned 55 properties located in Arizona, California, Colorado, Florida, Illinois, Maryland, Massachusetts, Michigan, Minnesota, New York, Nevada, North Dakota, Ohio, Pennsylvania, and Virginia, totaling approximately 4.1 million rentable square feet (including approximately 1.3 million rentable square feet under development/redevelopment), which were 99.1% leased (based on square footage) with a weighted-average remaining lease term of approximately 15.9 years. As of May 6, 2020, the company has invested approximately $719.7 million in the aggregate and had committed an additional approximately $143.2 million to reimburse certain tenants and sellers for completion of construction and tenant improvements at IIP’s properties.

Financial Picture

In January, IIP completed an underwritten public offering of 3,412,969 shares of common stock, including the exercise in full of the underwriters’ option to purchase an additional 445,170 shares, resulting in net proceeds of approximately $239.6 million. The company reported that it has roughly $108.3 million in cash and cash equivalents and approximately $272.9 million in short-term investments, totaling approximately $381.2 million.

Debra BorchardtMarch 27, 2020


Cannabis real estate firm Zoned Properties, Inc. (OTCQB: ZDPY) announced its financial results for the year ending December 31, 2019, following the market close on Thursday. Revenues for Zoned Properties were $1.26 million for the year versus $1.24 million for 2018.

The company reported that operating expenses were $1.26 million for 2019 versus $3.20 million for 2018, which included a one-time non-cash write-off of $1.85 million related to deferred rent receivables in the second quarter of 2018.

“Zoned Properties closed 2019 with a tight capital structure, a clean balance sheet with no toxic debt, and a positive cash position, a rarity among companies operating in the regulated cannabis industry. We have a strong, unleveraged portfolio of triple-net leased properties producing passive rental revenue that are positioned for large-scale expansion and increased value potential. I am extremely excited about our opportunity to utilize the past year’s achievements to scale Zoned Properties in the coming years,” commented Bryan McLaren, Chief Executive Officer.

Cannabis Franchise Investment

Earlier this week, Zoned announced it had partnered with a start-up cannabis franchise organization. Zoned Properties made an initial investment of $100,000 into the start-up cannabis franchise organization, in the form of a 5-year Convertible Debenture that bears interest at the rate of 6.5% per year. Assuming full conversion of the Convertible Debenture, at the sole discretion of the company, Zoned Properties would own a 33% membership interest in the organization. McLaren will also serve on the franchise organization’s management committee to oversee the investment and provide advisory expertise.

“With this strategically placed investment, we are thrilled to formalize our partnership with an exciting and innovative new organization,” commented Bryan McLaren, Chief Executive Officer. “The founders of the start-up cannabis franchise organization have significant industry experience that we believe will be an important growth driver for Zoned Properties. We plan to release further details about the partnership and the start-up organization in the coming months.”

Looking Ahead

“I believe 2020 will be a transformative year for the cannabis industry. As we continue to execute on our strategic plan, Zoned Properties is positioned to play an important leadership role in shaping this emerging industry while capitalizing on this transformation for the benefit of all stakeholders,” continued Mr. McLaren. “Subsequent to the 2019 year-end, Zoned Properties was validated by the United Nations and One Carbon World as the first cannabis industry-focused business to achieve carbon neutrality, we completed a $100,000 investment in an exciting new franchise start-up organization, and we have continued to expand our advisory services across the cannabis industry. We very much look forward to sharing tangible updates as we work to grow Zoned Properties as an industry-wide leader.”

The stock was listed from its 52-week of 13 cents to lately trade at 17 cents.

Kaitlin DomangueJanuary 25, 2020


Innovative Industrial Properties, Inc. (NYSE:IIPR) has placed approximately 2,000,000 shares of common stock for public offering, representing roughly 22% of the shares outstanding.

The company’s plan for the revenue of the sale is to invest in specialized real estate assets. The assets are intended for cultivation and processing facilities for corporate use and in alignment with the company’s investment strategy.

The company placed the public offering of 2.967M common shares at $73.25/share. Gross proceeds will equate to $217.4M. Underwriters are expected to be offered a 30-day option to purchase up to an additional 300,000 shares of its common stock.

According to MarketWatch, since the announcement of the public offering, the REIT’s stock has dropped 4.5% in premarket trading, pricing 7.8% Thursday’s close of $79.45.

Key players in the offering include BTIG, LLC as sole-book running manager, BTIG, LLC is acting as sole book-running manager for the offering; Compass Point Research & Trading, LLC and Ladenburg Thalmann & Co. Inc., a subsidiary of Ladenburg Thalmann Financial Services Inc. as co-lead managers, and Roth Capital Partners as a co-manager.

Innovative Industrial Properties, Inc. is an internally managed real estate investment trust. It is focused on the acquisition, ownership and management of specialized industrial properties leased to licensed medical-use cannabis facilities.

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