Navigating through the many opportunities available in Cannabis Real Estate can be overwhelming and at times confusing. However, there are some main things to focus on, that will get you headed in the right direction for making decisions on a property.
These are fundamentals. Keep in mind, this information is valuable to know whether you just locked down an awesome spot or are just starting to look around.
KNOW YOUR ZONING
What is the zoning designation for your property? Is it zoned AG? Is it light industrial? Is it rural residential? Figuring out the specific zoning will help you to look up the ordinances for the city or county the property is in, and see what is allowed for each zone
KNOW YOUR ORDINANCES
Is it located in a County or City? What are the ordinances regarding Cannabis cultivation or running Cannabis related businesses on that property for that County or City? You can go to their county or city websites and search for their cannabis ordinance pages or call the specific planning department for that municipality to research it.
BE SPECIFIC WITH YOUR INTENTIONS
Make sure you focus your questions and research on exactly what your plans are for the property. Are you doing cultivation? Are you wanting to open a dispensary? Do you want to operate a medibles kitchen? Do you want to do manufacturing with extractions? Will it be volatile or non-volatile and what is allowed?
Have a detailed conversation preferably with the seller. The seller’s agent or representative can be a great resource too, but when you are dealing with a Cannabis property or business it’s great to be able to speak to the owner.
KNOW YOUR LICENSING AND PERMITS
The owner may have already been operating on the property and possibly applied for permits. Great! Ask if you will be able to be provided with that documentation. They may want you to sign a non-disclosure to make sure you keep the info confidential and that is normal. Along with asking about the permits, ask exactly what the permit will allow.
If it’s cultivation, what is the square footage allowed for the grow? Sometimes referred to as the canopy, which means the amount of space the plants can occupy. Does the zoning specify what type of grow? Indoor, outdoor in greenhouse or hoop house with light dep, outdoor with plants in the ground?
Has the application for the permit been filed? If so, when? Has the property been inspected by the County/City? What stage do they believe the permit is in? Has the seller been given any indication of a time frame for their permit application to be completed? Was it filed by a Cannabis consultant company or attorney who specializes in the application packages? This can be important because there are many things that have to be checked off in order for the permit application to get approved and so all this needs to be done properly.
KNOW YOUR INSURANCE
A smart business owner takes every detail into account. Insurance is one of those things you want in case something were to happen to your operation. Consider flooding, fires, theft, and even possible burglary for your operation. Retail stores are insured different than farms, and the reasons are simple. You wouldn’t insure a tomato farm the same way you’d insure a local grocery store would you?
Don’t let the details overwhelm you, Cannabis properties are about running a business professionally and making sure you are lined up for success is important, so it’s worth it!