Cannabis Legalization, Only Weeks Old, Already Sparking Land Rush

By:
Chris Gaetano
Published Date:
May 4, 2021
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Although New York state legalized adult-use recreational cannabis just a few weeks ago, the measure has already sparked off a major land rush, as companies scramble to secure prime real estate for when the nascent industry matures.

Crain's New York Business
, for example, is reporting that Columbia Care, one of the state's already-existing medical dispensaries, has already sealed a $42.5 million deal for 34 acres of land in Long Island that it plans to use for marijuana cultivation, on top of a site it already has in Rochester. The company paid $15 million in cash and the remainder in stock.

This is not the only such deal, as the New York Times is reporting that cannabis entrepreneurs are already rushing to buy up properties that could be turned toward the recreational cannabis industry. While in the countryside, companies are buying up farmland, in the city,companies are looking for good spots for retail dispensaries, with brokers negotiating with landlords to allow for leases to such businesses in the future. One broker, Lee and Associates, says that by working with landlords, it has already lined up about 200 locations for retail dispensaries.

Ultimately, said the Times, there could be up to 900 dispensaries in New York and over 4 million square feet of cultivation space. While the parties to land deals have had to contend with zoning regulations meant to keep the business away from certain spaces, as well as financial institutions wary of financing businesses connected with something still illegal on a federal level, cannabis company executives believe that economic incentives will soon erode some of those barriers. This, in turn, will allow for easier access to capital to further grow the sector, something the industry has long struggled with.

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