The National Association of Realtors sees better real estate activity in states with legal cannabis
The National Association of Realtors has presented a study that is based on a series of surveys conducted in September of last year to more than 600 commercial brokers in legal marijuana states. It seems to be that, as opposed to 2018 trends, cannabis business investors have been looking into acquiring more commercial property such as warehouses or retail places in states that have over three years of cannabis legal operations.
“It is very important to understand the supply and demand and the regulatory dynamic in each state. Focusing on states with higher barriers to entry makes a license more valuable and makes that real estate more valuable,” said Katie Barthmaier, CEO of Green Acreage, a cannabis-focused real estate investment trust. According to the analysis presented, the demand to purchase warehouses increased by 42% in the markets with longer periods of recreational legalization. For states that are newer to the cannabis legislation, there still was a reported increase of 34% for those with adult-use cannabis legislation. Even for the states with no recreational marijuana legislation still reported an 18% increase in the demand for warehouses.
During 2018, there was a spike in this number, and those states and those states with only medical marijuana legislation had more demand, 34% to 27% for places with also recreational. “In states that have a longstanding legal [cannabis] industry, warehouses have especially been of interest to commercial investors. That increased demand, I suspect is not just for storage but for growing,” said Dr. Jessica Lautz, vice president of demographics and behavioral insights for the National Association of Realtors.