Here are the New York real estate options cannabis retailers should consider
As New York State prepares to unveil its licensing process for cannabis operators, applicants are raising questions about the impact of real estate on the process.
Some applicants have begun searching for Manhattan retail space in hopes that it would make their applications more competitive, RIPCO’s Colby Pipertold the New York Business Journal.
But Come Back Daily founder Steven Phan, who launched the CBD retail operation that once included four stores in Manhattan and one in White Plains, believes that this strategy is costly and counterproductive.
“It’s a lot of risk and costs to take that probably won’t bring the result that many of these applicants are expecting,” Phan, who also is also retail chair of the New York Cannabis Growers and Processors Association, told the New York Business Journal.
Tyme Ferris, co-founder of Boonville, New York-based Pantheon Collective, says that finding landlords willing to rent to dispensaries is not as easy as it seems either. Ferris, earlier this year, spoke with the Albany Business Review about some of the challenges that he faced in finding space, such as expectations of deep pockets or bias towards the industry.
Overcoming these misconceptions, both say, require consistent community engagement and education to show that companies have remained proactive in addressing many of these concerns.
Another obstacle, Ferris says, has been cannabis status as an illegal drug on the federal level, which makes it difficult to acquire certain financial services and tax benefits, such as writing off large chunks of retail space.
For his operations in Colorado, Ferris says, he was always cognizant that spaces in his store that held cannabis products were non-deductible for federal tax purposes. He plans to continue this model in New York in a future retail space.
During the site selection process, Phan says, applicants should think creatively about their product and the demographics seeking it.