Innovative Industrial Properties (IIP), a real estate investment trust based in San Diego that specializes in sale-leaseback deals in the marijuana industry, spent $17.5 million to do such a transaction near its Southern California headquarters. IIP bought a 70,000-square-foot facility and quickly signed a long-term lease with Kings Garden, a cannabis company based in the Coachella Valley, about 150 miles from San Diego. Kings Garden plans to use the facility to house a cannabis cultivation, manufacturing and distribution operation, according to a news release. This is the fifth leasing arrangement between IIP and Kings Garden, the release noted. The purchase, which comes only one month after IIP engineered a $49 million sale-leaseback in Boston, adds to a cannabis real estate portfolio that includes 56 properties across 15 states that are home to legal marijuana markets. As of mid-May, IIP has invested roughly $740 million in marijuana-related properties, according to the release. Innovative Industrial Properties trades on the New York Stock Exchange as IIPR.
California’s three licensing authorities will all begin immediately deferring business license renewal fees for marijuana companies as part of the state’s coronavirus response, the agencies said in a joint news release. The California Bureau of Cannabis Control and the departments of Food and Agriculture and Public Health said licensed marijuana businesses whose permits expire between May 14 and June 30 can request that their license fees be deferred for up to 60 days. License fees already paid this year for renewals will not be refunded however, according to the release. The California Cannabis Industry Association (CCIA) applauded the move, calling it a “step in the right direction.” “While the cannabis industry was thankful for being deemed an essential business, the industry as a whole has been left out of the relief programs at both the state and federal levels that have eased financial burdens faced by all businesses,” the CCIA noted. “The fee deferral announcement that came out today is a step in the right direction. We are encouraged that industry advocacy efforts have evolved into actions that provide real relief for the essential regulated cannabis industry.” "license renewal,license renewal"
The coronavirus has further derailed systemic reforms to the California regulatory agencies that oversee the state’s marijuana industry under a revised state budget plan. In the budget proposal released Thursday, Gov. Gavin Newsom said that his previously announced goals – merging the state’s three regulatory agencies and streamlining marijuana tax collections – would have to be put off until next year because of complications stemming from the coronavirus. During his January announcement, the governor did not release specific details of his proposals except to unveil the name of a proposed combined regulatory agency – the Department of Cannabis Control. And Thursday, the newly revised budget summary made clear the governor’s plans won’t happen until 2021 at the earliest. According to the summary, Newsom’s administration: “Was in the process of developing a more detailed plan … for the transition (from three cannabis regulatory agencies to one). However, this process was interrupted by the COVID-19 pandemic, requiring a delay in the consolidation as planned.” The summary promises that a specific consolidation plan will be included in the 2021-2022 state budget.“Remains committed to simplifying and improving cannabis tax administration and will work with stakeholders on a proposal for inclusion in the budget next year.” The revised budget summary also stipulated that marijuana regulators will receive a total of $143.8 million in funding: $68.2 million for the Bureau of Cannabis Control.$20.8 million for the Department of Public Health.$54.8 million for the Department of Food and Agriculture. The funds are intended to be used for ongoing licensing and enforcement by the agencies as well as to “shift sworn investigators from the Department of Consumer Affairs’ (DCA) Division of Investigations to” the Bureau of Cannabis Control, which is a wing of the DCA.
declared essential during the coronavirus outbreak are hoping to leverage newly allowed flexibility such as curbside pickup and home delivery into permanent ways of doing business. They also believe this is an ideal opportunity to seek additional regulatory relief and other reforms to help fend off challenges related to the economic downturn resulting from COVID-19. The emboldened marijuana industry also hopes to accelerate legalization efforts, especially given that states are becoming financially strapped amid economic shutdowns related to coronavirus. “Cannabis is going to be an important part of the economic recovery. … I think, first and foremost, is tax revenue,” Adam Goers, vice president of corporate affairs for New York-based multistate operator Columbia Care, said during a recent media briefing sponsored by the Cannabis Information Project. The Cannabis Information Project is made up of 12 of the largest marijuana operators in North America, with a mission that includes communicating the benefits of the industry to the public, regulators and other cannabis stakeholders. According to industry officials, more flexible regulatory regimes and marijuana laws offer a potential win-win for companies and governments including: Additional sales for cannabis businesses.Significant tax revenue and job growth for states and municipalities at a time they need it most. Such flexibility also would help state-legal marijuana businesses stem losses to illicit markets, another benefit for both the industry and communities. The industry wish list depends on the location, but here are a few examples: Permit curbside pickup and home delivery as permanent options going forward in states that are now allowing it on a temporary basis.Add smokable flower and physician discretion to New York’s medical marijuana industry, which currently is one of the most restrictive MMJ programs in the country.Ease investment restrictions. In Oregon, for example, state regulators must approve any loan to a marijuana business that exceeds $100,000. Industry officials said the cannabis industry has shown during the coronavirus pandemic it can operate responsibly in an environment with more flexibility such as curbside pickup and home delivery. Chris Melillo, senior vice president of retail operations for Massachusetts-based Curaleaf said: “I also think it’s a great opportunity to continue to lobby for change for patients and customers.” But policy changes at the state level are going to reach only so far, industry officials said. “Without any changes on the federal level and even on a state level, it’s undoubtedly true that we’re going to see bankruptcies, we’re going to see liquidations, we’re going to see job losses along the way,” Columbia Care’s Goers said. Short of nationwide legalization, industry officials see several federal reforms as crucial: Banking access.Tax equity. Marijuana companies, because of their federally illegal status, currently are prevented under Section 280E of the IRS code from taking business tax deductions.Insurance reimbursement for medical marijuana patients. Home delivery could remain long-lasting The coronavirus crisis not only compelled some states to deem marijuana companies essential but also ushered in a new way of doing business with online ordering, curbside pickup and home delivery. Kelly Fair, U.S. general counsel for Canadian-based Canopy Growth, noted that Colorado issued its first marijuana delivery license during the COVID-19 pandemic, a measure long advocated for by the cannabis industry and finally passed by state lawmakers last year. A number of states have permitted and encouraged delivery during the coronavirus crisis, and more than a dozen states put in place regulations allowing curbside pickup. Fair said she believes these changes will extend beyond the pandemic. Rather, she noted, they also are “signaling some broader policy changes in how jurisdictions allow dispensaries to operate.” Visit our shop.
Indus Holdings, a California-based vertically integrated marijuana company, said it secured up to $14.5 million in loan financing to complete a greenhouse and boost the company’s profitability path. Indus, which said it will close the deal in April, also will use the proceeds for renovations and as general working capital “to become profitable and self-sustaining.” Geronimo Capital and Merida Capital are providing the financing. Geronimo is led by George Allen, the former president of multistate marijuana operator Acreage Holdings. Last May, Indus, which trades on the Canadian Securities Exchange as INDS, announced its intention to expand its operations outside of California to Nevada and Oregon.
Cannabis companies that provide delivery services – including delivery operators and retailers – are seeing a deluge of orders as customers stock up on marijuana products in the wake of coronavirus pandemic concerns. At the same time, these companies are putting into place unprecedented measures to ensure their delivery drivers and customers stay healthy, ranging from taking employees’ temperatures to providing them with latex gloves and alcohol-based disinfectants. In addition, states including Massachusetts, Michigan, New York and Illinois are taking steps to encourage home delivery of cannabis products as well as to give customers the option of curbside pickup. Policies cannabis delivery services and retailers have implemented include: Providing drivers with an alcohol-based disinfectant solution and latex gloves and instructing them to sanitize their hands between deliveries and wipe down commonly touched items and surfaces.Taking employees’ temperatures at the beginning of their shifts.Cleaning off phones and terminals.Implementing a no-touch ID verification process in stores and when making deliveries.Instructing employees who have been sick or been around someone who is not well to stay home. Meanwhile, cannabis retailers are scrambling to remove obstacles that might inhibit deliveries. In California, for example, retailers are petitioning the Bureau of Cannabis Control to lift the requirement that customers who have cannabis delivered must sign to verify they received their orders, said Elizabeth Ashford, senior director of corporate communications at California-based cannabis delivery company Eaze. Delivery spike in the past few days On Sunday, Eaze saw a 34% increase in the number of customers signing up for its service as well as a surge in the size of orders, Ashford said, noting consumer preference has shifted toward edibles. Also in California, Driven Deliveries has seen a nearly 20% increase in transactions and a 10% rise in order value since coronavirus was discovered in the state, CEO Christian Schenk said. “We have had an increase in first-time customers of 6% this week alone, which is almost double our normal new customer performance,” Schenk said. Oakland, California-based retailer Harborside is adding two more vehicles to its fleet to keep up with demand for cannabis delivery, said Pedro Fonseca, general manager of the company’s stores. Harborside plans to hire up to three new delivery drivers and shift some workers from its sales staff into that role. Flower still accounts for the majority of Harborside’s sales, Fonseca said. Harborside is providing all employees with masks, hand sanitizer and gloves. The company also is monitoring the number of people in the store. “If we find we have more than 100, we’ll have them line up outside,” Fonseca noted. San Francisco cannabis delivery platform Sava saw an uptick in orders March 11 and then a big spike March 13, said Amanda Denz, the company’s co-founder and chief marketing officer. Denz estimates daily sales are up to four times what they normally are and that the company, which carries 400 SKUs from various brands, is starting to run out of products. Goods that Sava’s customers are purchasing most often include sleep aids such as tinctures and edibles. Cloverdale, California-based Garden Society, which delivers its own brand of products to customers, is going through inventory quickly, said Karli Warner, the company’s co-founder. Many customers are ordering mini-pre-rolls that come 10 to a pack. “People are looking for smaller sizes so they’re not passing them around,” Warner said. Delivery rule shifts Tempe, Arizona-based digital payment and compliance platform Alt Thirty Six is waiving all transaction fees for delivery purchases for new and existing merchants until April 20. In Massachusetts, medical marijuana treatment centers are permitted to expand their delivery service and to remind patients that they are allowed to acquire up to a 60-day supply of medical-grade marijuana. Michigan Gov. Gretchen Whitmer signed an executive order Monday that permits all licensed marijuana retailers to provide home delivery and curbside pickup of products. Before Whitmer signed the order, retailers had to be licensed for delivery, and sales had to be conducted inside the store. The New York Department of Health is permitting registered organizations that have previous approval to deliver medical marijuana to the homes of registered patients and designated caregivers through April 16 without written approval.
Prosecutors for a U.S. attorney’s office in California issued a grand jury subpoena for records related to 30 marijuana companies, including the parent of Weedmaps. Although the purpose of the investigation by the U.S. attorney for the Eastern District of California is unclear, according to MarketWatch, a subpoena was issued to Ghost Management Group, which owns California-based Weedmaps. The subpoena “covers documents related to cannabis businesses listed on Weedmaps and records related to its ordering service,” MarketWatch reported. Federal agents also sought records related to a wide-range of information regarding Weedmaps, including: Its staff.Investors.Accounting.Communications.Payments to government employees, elected officials and candidates for public offices. A Weedmaps spokesperson told MarketWatch that it receives such government requests “from time to time” and complies with them all. The company did not elaborate further. Weedmaps is a popular website among cannabis consumers looking to find marijuana retailers and also facilitates MJ deliveries. The company has been under fire from California officials since 2018 for advertising illegal marijuana retailers. Meanwhile, MarketWatch reported, prosecutors also requested records from Weedmaps regarding two other California cannabis companies, CannaCraft and Terra Tech. CannaCraft produces a marijuana-infused drink in partnership with Lagunitas Brewing Co. Terra Tech is a vertically integrated multistate marijuana operator. The U.S. attorney’s office, Terra Tech and CannaCraft all declined comment to MarketWatch.