Real Estate

Cannabis real estate covers the sourcing, leasing, and financing of properties for cultivation, processing, and retail use — a market shaped almost entirely by zoning and capital access rather than by property type alone. Most jurisdictions confine cannabis use to specific "green zones" defined by distance buffers from schools, parks, and residential areas, so a parcel's cannabis-use eligibility, not its square footage or condition, is usually the first filter. Because federal law still blocks cannabis businesses from most conventional mortgages, financing runs through cannabis-specific channels: sale-leaseback arrangements with cannabis-focused REITs, private lenders comfortable with the risk, or landlords who accept the business directly and price accordingly.

Fit to license type comes first: a cultivation site needs power capacity and water access a retail storefront doesn't, while a dispensary needs foot traffic and parking within a zone that allows retail cannabis use, which is often a smaller subset of the broader cultivation or manufacturing zone. Zoning diligence has to go beyond a city's cannabis ordinance to confirm the specific parcel hasn't been excluded by an overlay, moratorium, or unmet buffer distance. Capital structure is the other major variable: sale-leaseback financing trades ownership for cash but usually comes with above-market rent, while a direct lease from a cannabis-tolerant landlord costs less but offers no path to equity. Rent itself interacts with 280E, since plant-touching businesses can only deduct occupancy costs allocable to production, not retail floor space.