Opening large scale cannabis business projects doesn’t require 25 years of experience in Commercial Real Estate Development, a successful $2.2 billion company acquisition as founding member, or an ownership portfolio of mixed-use commercial buildings ranging in the thousands of acres – but those qualifications sure do help. As someone who has all three, Joe Kachuroi is situated as one of the leading real estate moguls to answer the question How does one develop the commercial real estate to open a cannabis dispensary in the United States, and what are the challenges?
Rules, Regulations, & Responsibilities – Oh My!
Let’s do some math. If you think developing and acquiring home ownership in the year 2023 is difficult, imagine this pain multiplied, add on immense regulation, and then subtract the jurisdictions with laws restricting your business. That’s what it’s like to be on the ground-floor of the emerging Cannabis Real Estate sector. Despite these businesses collectively going from $17 billion in legal sales in 2020 to $25 billion in 2021 – with projected growth of $100 billion by 2030, mind you – traditional banks and lenders aren’t always willing to work with real estate projects connected to a substance still not legal in all 50 states… yet. The fact that many state governments, as well as Federal laws, do not see the economic opportunities grown out of the cannabis real estate industry is one of the top contenders of why planning, building, and executing real estate projects is finicky at best. That’s why Joe’s extensive knowledge and firsthand experience in this multi-Billion-dollar-and-growing industry is imperative for your business needs. Joe holds the deep comprehensive and realized sophistication regarding the responsibilities and rules that go along with navigating an industry in its regulatory infancy. Essentially, he’s been on the ground floor of something big before anyone else.
Mistakes Can Make or Break You
Given all of the information up to now, it’s no surprise that the cannabis real estate industry is highly sought after from all angles. Imagine that demand when cannabis is legalized everywhere, and demand means money. Outside of the bare basics – business plans, investors, and contingency options – there are certain parts of the industry that you need to anticipate in order to avoid mistakes.
Mistake #1: Not implementing a mitigation plan
When it comes to an emerging industry on the verge of unseen opportunities, you need to mitigate errors as much as possible. Have a strategic plan with back-up options and mitigation actions so you can move forward confidently no matter what happens. Learn from the errors of those who built the foundation – don’t reinvent the wheel. Learn from Joe.
Mistake #2: Not having an established cannabis real estate expert on your team
Exploring this up-and-coming industry, with all of the twists and turns it provides, without any prior knowledge is like exploring a cave without a flashlight… and no knowledge of where you are. Industry experts like Joe are the key for newcomer success, as well as the wherewithal investors need to feel comfortable finally entering the largest growing industry in the United States.
Mistake #3: Miscalculating the budget
By now, you understand that this industry is young. You won’t have the same amount of preexisting knowledge as, say, someone in the traditional real estate development arena. Other than the typical budget items (building materials, workforce, etc.), you’ll need to anticipate required permit and license costs, as well potential upgraded utilities during construction.
COVID-19 Created Opportunities, & Americans Agree
Not much good came from the global pandemic that swept through the world for almost four years, so when a positive outcome is recognized its best to hone in. With COVID-19 taking its toll on our individual and collective mental health – not to mention the physical health ailments associated with it – people looked towards cannabis to treat themselves. In fact, in 2020 alone there were 53.2 million additional cases of depression and 76.2 million additional cases of anxiety worldwide, causing a medical cannabis market projected compound annual growth rate of 26.6% over the next 4 years. The Pew Research Center even conducted a study in 2021 that found roughly 60% of American adults believe cannabis should be legalized both medically and recreationally. This shift in the societal conscience, combined with the public’s increasing need for the healing properties cannabis provides, is why this industry is booming like no other has in quite some time.
To sum it all up, Joe Kachuroi has positioned himself as a leading expert to ensure Americans get the help they need, business owners get the tools they need, and investors get the equity they need. It’s no mistake that the cannabis real estate market is experiencing exponential growth with Joe at the helm.