Pace of Search for NYC Retail Space Heightens Among Potential Cannabis Vendors
The expectation that vendor license applications awarded by New York State’s Office of Cannabis Management (OCM) are slated to open at some point in the next 30 to 90 days has prompted aspiring vendors to accelerate the pace of their searches for available retail space, signing lease agreements with a range of different conditions. Over the past 12 months, the number of potential cannabis tenants, made up of a mix of “experienced business owners to aspiring entrepreneurs looking at densely populated NYC,” has quadrupled.
While the impending opening of applications has contributed to heightened activity, two other factors are driving pressure including signs of the retail market recovering, resulting in a tighter market with more competitors for space. In addition, more and more landlords have gradually become open to leasing to a cannabis space, adding more potential to the market; and although risk remains a factor at the center of many landlords’ decisions, since marijuana is still illegal at the federal level, meaning that federally chartered banks cannot accept payments from landlords leasing to cannabis businesses, it is no longer as off-putting as it was a year ago.