How to Expedite the Cannabis Property Selection Process

Real estate often causes cannabusiness owners to spin their wheels. With short application windows and the need to have contingency plans in place, it’s easy to prolong your search for the right cannabis property.

But finding the right location for your cannabusiness doesn’t have to take forever. If you do it right, you can speed up the process and get to building your business faster. That said, a cannabis property must meet very specific zoning requirements and should thus be approached differently than other kinds of real estate.

Higher Yields Consulting How to Expedite the Cannabis Property Selection Process

To that end, we’ve developed an expedited process to help you find a cannabis property without getting blindsided by common real estate roadblocks. 

Here’s our step-by-step process for finding your cannabis property more efficiently.

Start With the Green Zones

The first thing you need to know is how to choose the areas in which to look for your cannabis property. Many people do this by choosing a city, downloading a list of 1,000 or so properties in that city, and narrowing the list down to 100 properties from there. 

But once they start going through those specific properties, they find that none of them actually qualify as cannabis properties because they aren’t zoned properly. 

We created our green zone assessments for this very reason — because no one wants to settle on a location only to find out their cannabusiness isn’t legally allowed to operate there. Instead, our process starts with establishing where the facility you plan to operate is allowed to be, and then choosing from those locations.  

Research the Requirements

Once you know where your cannabis property can legally exist, do your research to find out what requirements it will need to meet, with special attention to regional and municipal setbacks

Usually, a city will determine setbacks based on how far the property is from a dispensary or how many dispensaries and cannabis facilities can be in a certain ZIP code or territory. But they’ll also dictate how far a facility must be from churches, day care centers, schools, and rehab facilities. 

These kinds of facilities are constantly shutting down and opening up, but the city might only update their green zone map once per quarter — meaning the map can become inaccurate within a week. 

At HYC, we use a number of systems and databases to create our own up-to-date green zone maps with all relevant setbacks factored in. From there, we search for addresses within those areas, giving us a narrowed list of addresses we then verify with the city to determine if they truly qualify to be used as cannabis properties.

Get Boots on the Ground

Once we have our narrowed list of potential properties, the next step is to get out there and physically scope out the area. Sometimes you’ll even find a cannabis property that isn’t in the system because it isn’t for sale or lease just yet.

Higher Yields Consulting How to Expedite the Cannabis Property Selection Process

Don’t be afraid to knock on the doors of qualified properties and ask about the company’s lease and when it expires. But be very targeted in which doors you knock on, otherwise you’ll be wasting your time. 

Above all, you need to have a process. A lot of brokers make the mistake of thinking any property will work and end up whittling down the list of possibilities into locations that in fact won’t. 

Protect Yourself From Real Estate Pitfalls

Even once you’ve found the property, you still need to be strategic as you negotiate with the landlord. Some landlords may try to charge more or create a bidding war once they find out you intend to use the space as a cannabis property. 

Protect yourself when negotiating for a cannabis property with a contingency agreement, which keeps you from being bound to the property if your license application is denied. Contingency agreements can be difficult to negotiate because of the risk they pose to landlords, so you may have to explore creative solutions.

In some cases, you can put the landlord’s mind at ease by putting down a deposit or agreeing to a smaller monthly lease until your application is officially approved. You might even have to give up equity in your business to be able to lock down the property. 

If you’re lucky, you might work with a developer who’s early in their career, has a bunch of properties, and is willing to roll the dice on your cannabis property while they get the others up and going. 

Finding a Cannabis Property Doesn’t Have to Take Forever

Choosing your cannabis property can be one of the most difficult parts of opening up a cannabusiness, especially if you approach it like you would any other type of real estate. But with the right process and tools, you can minimize risks and choose your property efficiently. 

To get expert guidance and a tried-and-tested process, contact HYC for a green zone assessment and to find the most lucrative cannabis property for your business.

Do You Need a Commercial Cannabis Real Estate Agent or a Cannabis Consultant?

Higher Yields Consulting Do You Need a Commercial Cannabis Real Estate Agent or a Cannabis Consultant?

Unlike most commercial real estate, the cannabis real estate landscape is limited by regulations and ordinances that go far beyond choosing the best location for traffic counts. You’ll need expert help navigating all the green zones and setbacks to ensure your cannabusiness is compliant and in an advantageous location. 

Each municipality is different, and even neighboring municipalities can have entirely different requirements. So, it’s important to work with someone who can help you choose the best location for the cannabusiness you’re building.

Higher Yields Consulting Do You Need a Commercial Cannabis Real Estate Agent or a Cannabis Consultant?

You have two main options: work with a commercial real estate agent to choose your property, or work with a cannabis consulting firm that can act as a sort of one-stop shop for the entire setup process. But which is the best, most cost-effective choice in the long run? 

Read on to find out whether a commercial real estate agent or a cannabis consultant is the best choice to help you with your cannabis real estate. 

Commercial Real Estate Agent: Help Selecting Property

When dealing with cannabis real estate, you’ll need a brokerage relationship of some sort to navigate contracts and coordinate all the moving parts of the transaction. A commercial real estate agent will likely have experience with the contract process and can help you assess traffic counts to choose a potentially profitable location. 

However, especially if you’re in cultivation, there’s a lot more to consider than just traffic. For example, if the building previously housed any sort of cultivation, you’ll need to know whether they used any pesticides or left anything else in the building that could potentially harm your crop. 

You’ll also need to know what it will take to operate the building as a cannabis facility. While the property might look good on the surface, things like mold, lighting,  and ventilation will impact the facility’s operation, as well as the cost of retrofitting the property into a cannabis facility. 

A commercial real estate agent may not be familiar with all these considerations or know what to look for in an ideal cannabis real estate location.

Cannabis Consulting Firm: A One-Stop Shop

When choosing your cannabis real estate property, working with someone who has a cannabis background is essential. You need someone who knows what to look for and about ordinances and regulations for the particular municipality you’ll be operating in.

While a commercial cannabis real estate agent will start by identifying the best traffic count area — without regard to green zones, setbacks, etc. — a cannabis consultant can start with the areas where a cannabis facility can actually be placed. From there, they can help select the best of those available locations. 

Higher Yields Consulting Do You Need a Commercial Cannabis Real Estate Agent or a Cannabis Consultant?

Also keep in mind that for cannabis real estate, you’ll need more than just the property. You’ll also need to coordinate design and build, METRC compliance, security, and so on. Having one firm handle all of those considerations will save you a ton of time and money. 

Real estate is a large purchase — one of the largest parts of your business — and it’s something your business is going to be connected to for a really long time. You want to make sure that the property you purchase is going to work for cannabis specifically. 

The last thing you want is to start the process of a cannabis real estate property purchase only to find out it won’t actually work for cannabis and have to start all over again. A cannabis consultant can offer perspective on all the different elements of a cannabusiness and help you avoid any unexpected missteps.

Making the Best Choice for Your Cannabis Real Estate

When choosing who to work with for your cannabis real estate, weigh heavy on finding someone with at least some cannabis knowledge. The industry has so many nuances to stay compliant on, and you don’t want to overlook any minor detail. 

You also don’t want to get yourself stuck with a property you can’t actually use, which can happen in more than one way with this industry. Choosing the wrong property is one, but it could also be a simple matter of the licence you applied for falling through. 

This sort of situation is unique to cannabis real estate, so someone without cannabis experience may not know to prepare for the possibility. A cannabis consultant, on the other hand, can help put contingencies into your contract to protect you if you don’t end up winning the license. 

Along with industry-specific knowledge and experience, cannabis consultants are often equipped with specialized tools. For example, at HYC, we use geomapping and other software systems to locate the best cannabis real estate properties.

Get Help Navigating the Cannabis Real Estate Market

Especially in a saturated market, choosing a cannabis real estate property can quickly turn into a game of Where’s Waldo?, so it’s important to work with someone who has the tools and knowledge to set you up at your greatest advantage.Ready to talk to a consultant about choosing your cannabis real estate property? Reach out to us to schedule a consultation.

Navigating Cannabis Real Estate to Find Success

Higher Yields Consulting Navigating Cannabis Real Estate to Find Success

Green zones play an important role in cannabis real estate, which, in turn, plays an important role in winning a license. In fact, many states don’t even accept applications if real estate hasn’t already been secured. However, challenges exist with green zones that can make securing real estate difficult.

Higher Yields Consulting Navigating Cannabis Real Estate to Find Success

In addition to a lack of inventory in green zones, state and federal regulations present themselves as challenges, too. Although the road to success may seem rife with obstacles, it can be navigated with the right research and preparation.

Here’s how to overcome these challenges and find success with cannabis real estate.

The Weight of Federal Regulations

Despite being legal in most of the United States — and all of Mexico — federal legislation has yet to legalize cannabis. As a result, it remains illegal for any FDIC-insured bank to receive or process money that has anything to do with the cannabis industry.

Naturally, this makes life difficult for a cannabis real estate operator: If a property owner has any federally backed loans tied to a piece of property — as most do — they cannot lease to a cannabis operation. Their only option would be to sell, which would mean giving up a lucrative asset.

The Safe Banking Act Offers Relief

Luckily, the Safe Banking Act saves the day. Introduced by Rep. Ed Perlmutter of Colorado’s seventh District, this legislation loosens the government’s grip on cannabis-related finances. Broadly, the Safe Banking Act prohibits the government from punishing banks that work with legitimate cannabis operators.

Specifically, this bill allows:

  1. Institutions to provide general banking services to cannabusinesses.
  2. People and banks to sell affordable, federally backed loans to the cannabis industry.
  3. Cannabis real estate operators to lease their properties rather than be forced to sell.

The Safe Banking Act has opened new doors for operators as well as those in ancillary fields — in particular, cannabis real estate.

State Restrictions, Green Zones & Setbacks

Unfortunately, both the federal and state governments create challenges for cannabis real estate operators. For instance, space in green zones — areas in which cannabis operations can be legally located — is getting harder and harder to find. 

Further, cities continue to tighten regulations known as setbacks, which dictate the specific distances cannabis businesses must be located from facilities like schools, rehab centers, and day cares. Denver officials, for example, are adding fitness centers and public swimming pools to their list of setback regulations.

Recently, I worked with a client who had bought a medical-only dispensary attached to a cultivation facility with the goal of switching from medical-only to recreational. When the original owner had won the medical-only license, however, there were no setback restrictions in place for residential areas.

Higher Yields Consulting Navigating Cannabis Real Estate to Find Success

If we had kept the same medical-only license, the client would have been grandfathered into the property regardless of the new setbacks. Since we had to reapply for a recreational license, though, the new setbacks kicked in and we were forced to find a new location. 

The Promise of Emerging Cannabis Real Estate Markets

Although shrinking green zones prove to be both a nuisance and a challenge, new states offer opportunities. In particular, emerging states like New York, Massachusetts, Oklahoma, and New Jersey all have potential locations still up for sale.

These emerging markets present new opportunities for securing lucrative cannabis real estate. Doing so may give you a leg-up when the markets take off.

Moving Forward With Cannabis Real Estate

With all of the challenges, finding success with cannabis real estate can seem overwhelming, so we’re here to help. At Higher Yields Consulting, we find opportunities whether or not there’s supply because we create supply

We go out, knock on doors, and offer creative deals to property owners in green zones. This not only ensures the functionality of the industry but also builds generational wealth for property owners and their families.

Part of making the industry effective also involves tearing down the stigma that surrounds marijuana. By bringing the community together and giving back, we’re building a new, positive image for the cannabis industry.

Are you looking to secure real estate for your operation? Reach out today and get started!

How to Maximize Your Cannabis Yield: Floor Plans & Equipment Systems

How to Maximize Your Cannabis Yield: Floor Plans & Equipment Systems

Any cannabis operation — whether you’re cultivating extracting, infusing, packaging, or dispensing — has dozens of moving parts. A thorough planning process ensures a more efficient operation that can maximize your cannabis yield in terms of plants and profit. Professional planning to make the best use of your space can help guarantee that your cannabis operation runs efficiently. We’ve got a few tips to help your business bring in the best return per square foot.

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How to Maximize Your Cannabis Yield: Commercial Real Estate — Part 2

How to Maximize Your Cannabis Yield: Commercial Real Estate — Part 2

Choosing the best available property for your cannabis business is no small task. Will you build your own facility or adapt an existing building for your use? Is it better to lease or purchase? There are endless decisions to make when considering how to maximize your cannabis yield. Before you sign on the dotted line, we have some tips to help you choose a property wisely.

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How to Maximize Your Cannabis Yield: Commercial Real Estate — Part 1

california cannabis consultants

When selecting a property for your cannabis business, you want to be certain your investment aligns with your goals. At the outset, it’s important to think about how to maximize your cannabis yield in terms of production and financial return regardless of the vertical in which you choose to operate. Whether you’re thinking of buying, leasing, or doing a custom build, we have some tips on what to look for in a piece of commercial real estate — and some pitfalls to avoid.

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Cannabis Real Estate: Deals Depend on Timing, People & Politics

cannabis real estate

When it comes to finding a home for your cannabis operation, you may be challenged by zoning regulations, competition, and a looming deadline. Some cities and states require you to provide proof you’ve already secured compliant cannabis real estate as one of many rigorous criteria to apply for a license. We have some tips for finding and securing cannabis real estate, even in a tight market.

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Choosing the Right Marijuana Property for Your Cannabis Business

Choosing the Right Marijuana Property for Your Cannabis Business

There’s a lot the cannabis industry has working against it – like sophomoric legislation, gray legal areas, and closed-minded banking partners – but one of the most overlooked factors is real estate. Finding the perfect marijuana property for your budding business is no small feat, and there are far more factors than most business owners realize. From key decisions such as “To buy or to lease?” to “To vertically integrate or niche down?” the nuances of securing success start in the earliest days of building your business. Here’s what you need to know as you’re scouting out your business’s new home.

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5 Tips For Finding Cannabis Real Estate

cannabis-real-estate

5 Tips For Finding Cannabis Real Estate

You’ve decided to open a cannabis business, but first thing is first. You need a piece of real estate to operate on.

Finding the perfect piece of real estate is usually the first step in applying for a cannabis business license, whether it is for a dispensary, a cultivation operation, an extraction lab, a consumption lounge or a distribution headquarters. No matter what aspect of the cannabis space you hope to work in, your property choices will be a huge factor in the success of your application – and your eventual business. Planning ahead to make the right choices on property can be the difference between colossal failure and a thriving business.

Commercial Cannabis Real Estate Properties – Where to Start?

Not sure where to start? You aren’t the only one. But don’t worry. John Valdez, Higher Yield Consulting’s top real estate broker and VP, is here to help with our best tips for finding the right cannabis real estate for you. Read on to learn how to find your ideal property and set your cannabis business up for success:

1. Location, Location, Location is Paramount When It Comes To Commercial Marijuana Real Estate

The old saying about what’s most important in real estate “location, location, location” applies to cannabis as much as anything else. When you are choosing where to operate your business “the main thing is your location” explains Valdez.

Still, the considerations about location might differ depending on your business type. So think about what your business will need to thrive. For example, Valdez suggests that “if you are doing a cultivation facility, you want to build that close to transportation, where you can get your product out the door soon as you can.” On the other hand, Valdez says that “if you’re doing a dispensary, you want to make sure that you have good foot traffic, because you want a location where you’re clients are able to get to you easily.”

Your location will have a big impact on what you can really do with your business so make sure you find the right place to launch – with everything your business needs to succeed.

2. Learn the Local Cannabis Business and Real Estate Regulations

As you consider location, you should also learn about the local regulations for cannabis businesses in that area. It’s no good finding your perfect piece of real estate only to realize that it doesn’t have the right zoning for your business type. And these local regulations can be much more complicated than just zoning.

“Zoning is a key thing,” explains Valdez “but you want to make sure that the municipality is allowing that type of use.” There are so many aspects to these regulations, it can be easy to overlook something. “I’ve been working with consumption clubs lately” Valdez offers as an example, “and in Colorado setbacks are different for consumption clubs than they are for a dispensary.” Tiny errors on calculations for things like setbacks can be the difference between buying a usable or unusable property. So make sure you have experts on your team who can delve into the local laws and understand what you need.

3. Find a Broker and Cannabis Real Estate Team You Can Rely On

When it comes to your real estate broker, make sure you find someone who you can trust to navigate the complicated task of finding your property. “A broker that’s in the cannabis industry is crucial to having a successful closing and start up to your company” explains Valdez. “If you have somebody that doesn’t know what they’re doing, you can tie your project up for a long time before you even start that application.”

For this reason, Valdez says “one of the biggest things that I would recommend to you when you’re looking at real estate for cannabis is hiring a professional, not only a professional broker but hiring a professional team.”

Cannabis specific real estate brokers understand the rules and regulations involved in using a property for cannabis and they already have contacts in the space. This is needed for finding the right property. Still this knowledge could be strengthened with the help of a good consultant. “Brokers should have a general idea of what the local restrictions are going to be, but having a consultant to verify it is also going to be key” says Valdez.

In addition to your broker and consultant, a good design expert is also a crucial member of the team. They can help assess what improvements might be needed to make a property functional, so you can make an informed purchase.

4. Pay Attention to Available Services

When considering a property, you should also look at the services available. Depending on your business, you may need particular services like access to enough electricity to power an indoor grow, or good internet access for a business headquarters. Whatever your service needs, you may want to find a property that already meets them. “What kind of service is on the property?” asks Valdez “Because your electrical service, your heating, your air conditioning service, those are things that you want to take a look at because those are high dollar items.”

You might plan to just upgrade your services when you move in, but in some areas upgrades aren’t possible or are extremely expensive. It’s best to plan and budget all of this before you make the final purchase. The last thing you want is to buy a property that you can’t make work.

5. Consider Retrofitting a Potential Cannabis Property Carefully

This brings us to the last tip – consider retrofitting carefully. When you are deciding whether to build a new building, retrofit an old one, or just find a property that already has what you need, it might seem like retrofitting is the cost saving option. But that’s not always the case – so a cost/benefit analysis is key for this decision. “For retro-fitting you want to make sure to see what you’re going to be able to salvage and what the build is going to be on it” explains Valdez.

To figure this out you need to know how much are you going to have to spend on the build out for a retrofit or renovation on the property. “Sometimes you can look at it and say, ‘hey, it’s going to cost us an extra $800,000 to build this out.’ Let’s take a look at building a facility from dirt.”

Before buying your property, think carefully about what kind of site improvements will be required. When these improvements are ignored, something as simple as a sprinkler system could add hundreds of thousands of dollars to your costs.

The Importance Of Commercial Cannabis Real Estate

Those are our best tips for finding your perfect property, but they just brush the surface of this complicated process. If you are still feeling confused on how to proceed, Higher Yields Cannabis Consulting can help. Our knowledgeable consultants have helped cannabis businesses in over 30 states to find the right property and successfully launch. We can help your business navigate the process as well. 

Schedule a Consultation
Whether you already own a cannabusiness or want to get into the business we can help.

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Higher Yields Cannabis Consulting

Higher Yields Cannabis Consulting

Higher Yields Consulting is a Marijuana Consulting Group comprised of industry experts with decades of combined experience in the legal industry. Whether you are looking to get into the business or already have a license we can help your business succeed. Call (844) HI-YIELD to schedule an initial consultation.