Just How Many Dispensaries Are Already in New York City?

New York’s adult-use cannabis market expects to be immense once it reaches maturity. Various reports suggest the marketplace could earn between $1 billion and $3 billion annually in the coming years.

Success will be determined, in large part, by the state’s ability to address the unlicensed market, sometimes referred to as the legacy market. States like California and Colorado have generated high sales but continue to struggle with unlicensed grows and dispensaries. 

New York’s Cannabis Control Board (CCB) and Office of Cannabis Management (OCM) have released legislation incrementally. In April, the state granted over 200 conditional marijuana cultivator licenses to existing hemp farmers. On June 1, the CCB approved its first set of packaging, labeling and advertising regulations. Plans have also been made to issue approximately the first 100 licenses to people most affected by the drug war. 

No further clarity has been given regarding license availability. In the meantime, a surge of unlicensed dispensaries has begun to open. Stores include brick and mortar, pop-up and mobile sales sites using the state’s current grey area gifting laws. Numerous operators assume early launching is the natural step to gaining an adult use license. Others caution that such a measure may eventually bite aspiring legal operators. 

How Many Businesses Are Selling Weed In New York City Right Now?

Unlicensed stores and sellers are popping up across the state. No more so than New York City, which consumed 77.44 metric tons per year of pot per year, according to a 2018 study. Sources offered various broad estimates of how many operate in New York City today, with most answers ranging between 100 and over 1000. 

The city has its fair share of licensed locations, with names like Curaleaf (OTC: CURLF), Columbia Care, MedMen (OTC: MMNFF), RISE and Etain, all having a presence across the boroughs. A search on Google reveals scores of unlicensed shops. A deeper dive via community cannabis contacts or a stroll in certain parts of the city will likely show others, including standalone sellers in the park and bodegas. 

Most sources noted that tracking how many sellers operate in New York City today is difficult.

“If you include every bodega and smoke shop selling unlicensed and untested cannabis, it’s easily in the hundreds, if not the thousands,” said Mike Zaytsev, academic director for LIM College’s cannabis degree program

Gregory M. Tannor, executive managing director and principal at real estate firm Lee & Associates NYC, said that when considering illegal shops and bodegas, “Every day there are new smoke shops opening throughout the city.” 

If using recent OCM reporting, there were at least 52 illegal storefronts across the state as of early 2022. In July, five months after announcing it had sent out cease and desist letters, the OCM announced it issued 52 warnings to various unlicensed operators that you can read here. However, some outlets report that non-cannabis operators were named, calling into question the list’s accuracy.

Why Open Now? 

 

Some unlicensed operators believe that if they open now, they are likely to win a retail license once the state begins issuing permits. Some offered caution to those individuals. 

Kassia Graham, co-founder and social media director for Cannaclusive, said that the state is taking note even if it seems lax on enforcement. She feels that entering the market now only makes sense if the operator has no interest in becoming licensed. Graham expects the illicit market to continue in New York past legalization like in other states. 

“We’ll continue to see a thriving legacy market due to the costs, compliance, and legal issues related to making the jump to the legal realm of the industry,” she opined. 

Andrew Livingston, the director of economics and research at Vicente Sederberg LLP, offered a similar opinion. 

 “The risk of being disqualified for operating an illegal enterprise is not a significant cost to those who are not interested or do not have the ability to open a licensed cannabis business,” He said. 

 Livingston added that the allure of quicker revenue in the illicit market likely further fuels the interest of some illegal operators. 

 Potential licensing bans might not faze existing grey operators already doing well for themselves. LIM’s Zaytsev feels it’s safe to assume that operators will continue on if they already have success. 

“Why would any of them stop,” he asked, adding, “They’re doing quite well, from what I’ve heard.”

Andrew Ward

Andrew Ward is a Brooklyn, NY-based freelance writer. He is the author of the book "Cannabis Jobs" (out October 2019). Bylines include Benzinga, High Times, Merry Jane, Weedmaps, PROHBTD, PotGuide, The Marijuana Times as well as several other publications, company blogs and live events.


FundCanna

Leave a Reply

Your email address will not be published. Required fields are marked *

Choose Your News

Subscribe to the Green Market Report newsletter that gives you original content delivered straight to your inbox.

 Subscribe

By continuing I agree to your Privacy Policy and consent to receive relevant newsletters and other email communications on events, editorial features, and special partner offers from Green Market Report. I can unsubscribe or change my email preferences at any time.


About Us

The Green Market Report focuses on the financial news of the rapidly growing cannabis industry. Our target approach filters out the daily noise and does a deep dive into the financial, business and economic side of the cannabis industry. Our team is cultivating the industry’s critical news into one source and providing open source insights and data analysis


READ MORE



Recent Tweets

@GreenMarketRpt – 21 hours

New Colorado Rules: More Packaging Mandates, But Also Supply Chain Flexibility

@GreenMarketRpt – 22 hours

Michigan Gov. Whitmer Makes Marijuana Top Cop’s Role Permanent

@GreenMarketRpt – 1 day

Michigan Man Who Halted Some NY Licensing Suing Los Angeles

Back to Top

Choose Your News

Subscribe to the Green Market Report newsletter that gives you original content delivered straight to your inbox.

 Subscribe

By continuing I agree to your Privacy Policy and consent to receive relevant newsletters and other email communications on events, editorial features, and special partner offers from Green Market Report. I can unsubscribe or change my email preferences at any time.