With voters having just approved the legalization of marijuana in three more states, Apto this week released the results of its latest Apto National Broker Buzz Poll, which was conducted earlier this month.
Incidentally, we named our periodic surveys “Apto Broker Buzz Polls” before cannabis real estate deals were in the news. We don’t mean to suggest that brokers are always buzzed! LOL.
On election day in the U.S., which was November 6, voters in Michigan legalized marijuana for recreational use, and voters in Missouri and Utah legalized the use of medical marijuana. Now, 33 states and the District of Columbia have enabled the sale of some form of legal marijuana.
The latest Apto poll surveyed commercial real estate brokers in the states that allowed for the sale of some form of legal marijuana prior to the recent election. Those states included: Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Hawaii, Illinois, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Vermont, Washington (State) and West Virginia.
Broker Survey Results
The poll asked commercial brokers about retail and industrial cannabis deals, and about sale and lease cannabis deals.
Among the brokers who have already been involved in a cannabis real estate transaction, 85% said they would do another one, while 15% said they would not.
Asked “How much more difficult is a cannabis deal than a conventional deal?” brokers on average said “8” on a scale of 1 to 10, with 1 being less difficult and 10 being more difficult.
Asked “How well are supply and demand matching up for retail cannabis real estate space in your market?” brokers on average said “4” on a scale of 1 to 10, with 1 being “not in balance” and 10 being “in perfect balance.”
Asked “How well are supply and demand matching up for industrial cannabis real estate space in your market?” brokers on average said “4” on a scale of 1 to 10, with 1 being “not in balance” and 10 being “in perfect balance.”
- Asked “How are cannabis deals pricing in your market (leases and sales)?” brokers responded this way:
- 76% said above-market pricing
- 21% said at-market pricing
- 3% said below-market pricing
Commenting on the poll results, Tanner McGraw, founder of Apto, said, “The slow but steady legalization of marijuana across more states is beginning to have an impact on real estate markets as local jurisdictions grapple with zoning and other issues that affect the availability of sites, be they for cultivation and storage or for retail sales of cannabis. The survey results suggest that there is somewhat of a shortage of sites, likely because allowable zoning has not caught up with demand.”
“Another apparent issue is financing for businesses engaged in marijuana cultivation, distribution and sales. Conflicting laws at the federal and state levels portend a thicket of regulatory compliance issues for participants in this industry.”
“Commercial real estate brokers are affected by these issues, be it location and siting, or capital and credit, as they work to serve the market.”
Thanks to those members of the commercial real estate brokerage community who participated in the poll, which included Apto customers and non-customers.