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8 Golden Tips for Investing in Hemp Real Estate

Investing in hemp real estate has become a phenomenal way for entrepreneurs to build wealth. A 2020 survey finds that about 33 percent of Americans have used CBD. They cite stress, anxiety, pain, and inflammation as reasons they take CBD supplements, lotions, and other products.

CBD’s growing popularity, however, does not ensure success in the industry. Follow these 8 golden tips for investing in hemp real estate to make smart choices and maximize your ROI.

Know How Much an Acre of Hemp Is Worth

How much an acre of hemp is worth depends on several factors. An acre that already has an irrigation system probably has a higher value than one that relies on rain for watering crops. Access to a major highway can also affect how much an acre of hemp is worth. After all, it takes time and money to move plants from the farm to the production facility. The shorter the distance, the more you can make from your crop.

Other qualities that can affect land value include:

  • Soil acidity.
  • How previous owners used the land.
  • Whether you already have a permit to farm hemp on the land.
  • Existing infrastructure for water, electricity, and other utilities.

If you have questions about the value of farmland, it never hurts to ask a professional appraiser to look at the property and give you an estimate.

Compare Regional Prices to Get a Good Deal on Hemp Real Estate

How much does an acre of land typically cost in the area? Reviewing regional land prices can help you determine whether you’re getting a good deal on your hemp real estate investment.

Work With an Experience Hemp Real Estate Agent

Even if you’ve purchased agricultural land before, you might not know how to find the best hemp real estate for your investment dollars. Growing hemp isn’t the same as growing other crops, largely because you have to deal with state and federal regulations that can affect how you operate and how much money you earn.

Working with an experienced hemp real estate agent helps ensure that you make informed decisions that lead to higher returns.

Identify all of the Ways You Can Make Money From Hemp

Obviously, you can use your hemp real estate investment to enter the CBD market. Before you decide to purchase or lease property, though, you should identify as many ways as possible to make money from hemp.

For example, you can sell your hemp to a company that makes CBD products. You can also purchase extraction equipment to start making your own CBD products. Is that an additional investment you’re willing to make? And will it lead to increased profits?

Other ways hemp real estate owners can make money include:

  • Leasing land to farmers who want to take advantage of your hemp growing permit.
  • Carefully trim flowers from the hemp plants to sell as CBD buds.
  • Extracting CBD and other chemical compounds from hemp leaves.
  • Selling stalks and other plant materials to companies that make products like cloth and paper.

Hemp isn’t just about CBD production. Use the whole plant to maximize your returns. Can you build a house out of hemp? Believe it or not, some companies use hemp fibers to make a material called “hempcrete.” It’s considered an eco-friendly way to construct houses and other buildings.

Estimate the Overall Cost of Ownership

It’s pretty easy to determine how much hemp real estate will cost to buy. You just negotiate a price with the current owner and add any applicable taxes and fees.

That doesn’t give you the total cost of ownership, though. Consider that you will probably have to:

  • Pay annual property taxes.
  • Add to the existing infrastructure.
  • Amend the soil to improve crop yield.
  • Renew your hemp growing permit.
  • Pay utility bills.
  • Hire employees.
  • Purchase seeds, equipment, and other essentials.

Determining the total cost is an ordeal, but you can make the process easier by hiring a business consultant who has been through the steps many times before.

Get Crop Insurance to Protect Yourself From Losses

Imagine that one day you look out over your acres of profitable hemp, growing easily in the sun after a gentle rain. The next morning, you wake up to learn that a terrible storm has destroyed area crops. Unfortunately, your farm got hit hard. You lost at least half of your hemp crop.

That’s a sad moment for anyone. All of that hard work gone to waste! You will feel much less upset, though, if you have crop insurance that protects you from financial losses.

Most farmers have crop insurance. Unfortunately, the government makes it a little harder for hemp and cannabis farmers—even though Congress legalized hemp in the Farm Bill. Private crop insurance providers have policies that can protect your hemp real estate investment.

Compare Funding Options to Lower Costs

It’s not always easy to get funding for 420 investment opportunities. You can find funding offers through 420 properties, though.

Always compare your funding options to make sure you spend as little as possible. Few people have enough money to purchase large plots of land without help. That doesn’t mean your loan’s percentage rate should eliminate your profits!

Explore loans and other funding opportunities so you can purchase hemp real estate that will grow healthy crops and earn you significant returns on your investment.

Consider the Benefits of Selling Your Hemp Real Estate Investment

What is an acre of hemp worth? They might have paid significantly less when you bought hemp real estate a few years ago. Today, you could potentially double or triple your money by putting your land up for sale.

Contact us today to get your hemp property listed and attract serious buyers willing to pay for the true value of your land.

June 12, 2021Comments Off
Everything You Need to Know About Finding & Investing in Cannabis Real Estate

The legal cannabis industry has had a tremendous effect on residential and commercial real estate properties. According to research from the National Association of Realtors (NAR), many residents living in states with cannabis properties say that the housing market has been tighter—likely because of the growing industry.

The same report shows that hemp and CBD real estate needs have influenced demand. Some examples of changes associated with cannabis legalization include:

  • 23 percent increased demand in storefronts.
  • 18 percent increased demand in farmland.
  • 36 percent increased demand in warehouses.

It’s impossible to say that the increased demand comes exclusively from medical and recreational cannabis legalization, but there’s a strong connection that industry experts have noticed.

Clearly, there’s a lot of money to make by investing in cannabis real estate. Like any investment, though, you need to make informed decisions to reap significant returns. The following guide cannot ensure that you find and invest in the perfect cannabis real estate, but it can certainly point you in the right direction.

Know the Different Types of Hemp and Cannabis Real Estate

Cannabis and hemp real estate has several categories that you should consider before determining which option fits your investment goals and local laws. Some popular real estate categories include:

  • Retail storefronts for CBD
  • Retail storefronts for recreational cannabis products
  • Dispensary real estate for medical marijuana products
  • Farmland for growing cannabis
  • Farmland for growing hemp
  • Residential real estate for growing hemp
  • Residential real estate for growing cannabis
  • Warehouse space for storing hemp and cannabis products
  • Warehouse spaces for indoor cultivation
  • Industrial space for making hemp or cannabis concentrates and other products

Learn Your State and Local Laws

As of mid-2021, 17 states and Washington, D.C. have recreational cannabis laws that let adults over 21 years old purchase cannabis products from licensed dispensaries or retail stores. Many other states have medical cannabis laws that let patients purchase medicine with prescriptions from their doctors.

The Farm Bill makes CBD legal in all 50 states, but products cannot contain more than 0.03 percent THC, which makes edibles, tinctures, and other products non-psychoactive.

It’s critical to note that every state has its own laws regulating the cultivation and sale of hemp and cannabis. Some states let adults grow a small number of cannabis plants on their personal property. Other states forbid personal cultivation.

Even in states with fairly permissive cultivation and sales regulations, rules can change from community to community. You might find it easy to get cannabis properties in West Hollywood licensed. Growing or selling cannabis in a more conservative area, however, could create many more challenges.

Whether you want to invest in 420 properties in California, Oregon, Colorado, or elsewhere, you must know how local laws will affect your investment. It’s never a bad idea to consult a cannabis business or real estate lawyer before you invest.

Your Cannabis Real Estate Will Require a Permit or License

No matter what type of cannabis or hemp properties interest you, you will need to get a permit or license before you can begin operations. Again, permit and licensing requirements can vary greatly from area to area.

Don’t assume that you can purchase CBD real estate and start growing hemp just because the Farm Bill made CBD products legal. States still require permits before you can grow hemp plants. Hemp and marijuana look extremely similar. In many ways, they’re the same plant. They do, however, contain different levels of chemicals like THC and CBD. States want to make sure that hemp farms follow regulations and do not try to make extra money by growing THC-rich cannabis.

Limited Permits

States, counties, and municipalities often have a limited number of permits for cultivating and selling cannabis products. If you cannot get a permit, it doesn’t make sense to purchase CBD properties and real estate for sale in that area. You have no idea how long you will have to wait before you can receive a permit that lets you start growing or selling.

You might think that 420 properties in California make it easy to cultivate cannabis. That isn’t always the case. Your opportunities might depend on how many permits the area has.

Buying Permits on the Secondary Market

Limited licenses and permits don’t necessarily mean that you cannot start reaping returns on your investment. Even if an area has already given all of its licenses to cultivators and storefronts, you could buy one on the secondary market.

Securing Funding for Hemp and Cannabis Real Estate

More and more states recognize that they need tax revenues from legal cannabis and hemp sales. The federal government, however, still considers cannabis an illegal drug. There is very little chance that the Department of Justice would ever target a cultivator or dispensary operating within a state’s legal framework. Conflict between federal and state laws, however, can make it difficult for investors to secure funding when they want to buy, lease, or rent real estate.

When most people want to purchase real estate, they go to banks or mortgage brokers to borrow money. Since most banks operate across state lines, they tend to worry about following federal laws as closely as possible. This makes them nervous about funding businesses in the cannabis industry. Many even feel uncomfortable lending money to buy hemp properties.

Instead of wasting time with banks that will probably turn down your application, turn to private lenders that don’t need to think as much about following every aspect of federal banking laws. Don’t give up on your investment opportunity until you research funding options through 420property. While 420property does not function as a lender, it does have connections to lenders that might want to help you fund a cannabis real estate purchase.

Make sure you follow these steps before applying for a cannabis business loan. An accurate credit record and high credit rating will make it easier for you to secure funding at an affordable interest rate.

Concentrates, Edibles, and Other Cannabis Products Offer More Investing Options

Edibles have become increasingly popular among people who want to consume CBD and THC discreetly. Edibles—including tinctures, oils, and gummies—also provide a smoke-free way to consume THC and CBD. Health-conscious consumers who enjoy using THC and CBD might shy away from smoking. Edible options make them feel better about enjoying cannabis products.

Commercial and industrial cannabis real estate often makes a good investment opportunity for people who want to get into the edibles market. In addition to purchasing or leasing 420 properties, though, investors need to access extractors that can remove chemicals from raw plant materials efficiently.

Iron Fist Extractors stand out as one of the best options because the company designs and manufactures all of its equipment in the United States. You can also get a customized system designed for the type of extraction that interests you.

If you want to invest in extraction, explore your options to find a cannabis supplier, equipment manufacturer, and warehouse space you can use to reach your goals.

Find a Cannabis Real Estate Broker in Your Area of Interest

Cannabis real estate can a successful investment can take a lot of experience and exploration. Purchasing a plot of land does not ensure that you can grow cannabis successfully. You need to know that cannabis and CBD properties for sale have fertile soil, irrigation systems, greenhouses, storage facilities, and other features that will help you reach your goals.

Unless you have significant experience in hemp and cannabis cultivation, it makes sense to use a cannabis real estate broker who can help you identify the best properties.

Finding and investing in cannabis real estate doesn’t mean that you have to purchase land or buildings in your area. It’s possible to invest in real estate in other states, too. You might discover excellent opportunities hundreds of miles from where you live. You can take advantage of those opportunities when you rely on an experienced, trustworthy cannabis real estate broker to find a property that fits your needs.

When you find cannabis real estate that interests you, 420property will help you locate a cannabis real estate broker in that area. You might want to visit the property before finalizing your purchase. Outside of occasional visits, though, the investment property can largely function without your involvement. That way, you make money from real estate without spending much time or expending much effort. You let your investment generate profits for you.

Explore Cannabis Investments With 420 Property

Want to learn more about investing in hemp and cannabis real estate? Search for cannabis real estate listings to find a property that meets your budget and business interests. Take some time to explore your options and learn about the advantages of investing in certain areas. The more you know about cannabis real estate investing, the more likely it is that you will reap significant returns on your money.

June 10, 2021Comments Off
7 Reasons You Need Cannabis Business Consultants to Grow Your Company

Now that you have a clearer idea of what cannabis business consultants do, you can start learning about some of the most important reasons you need them to succeed.

1. Vet Applicants to Hire the Best Executives and Managers

Owning a company doesn’t always mean you have the experience and skills to hire the best executives and managers. A cannabis business consultant can review applicants objectively to determine which ones can do the jobs best.

Eventually, your consultant will leave. The executives and managers will stay behind. Make sure you have professionals who can do their jobs well.

2. Use the Consultant’s Existing Connections in the Cannabis Industry

If you’re starting a new cannabis company – or expanding your existing company into new areas of the industry – you might need a cannabis business consultant’s connections to grow.

Imagine that you have developed a new strain that your test group loves. It tastes amazing and creates an energetic high without any anxiety. Right now, it’s sitting in your warehouse. You need to get it into dispensaries that can sell to consumers willing to pay for high-quality products.

The question is: Do you know which storefronts in your state are willing to sell your new strain?

An experienced business consultant can point you in the right direction. A truly hands-on consultant might even do a lot of the work to get your product on shelves.

It’s much more likely that a company will want to distribute your products when its owner has a personal connection to you. A business consultant can act as that connection.

3. Abide by All Regulations to Avoid Penalties

A business consultant’s services often include reviewing company guidelines to make sure they align with industry regulations. That matters more in the cannabis industry than most.

Even states with relatively permissive recreational cannabis laws enforce strict rules on businesses. For example, you might not have the option to advertise in certain places, or you might need to ensure the presence of security during your hours of operation.

To make matters even more complicated, regulations vary from state to state. They can even vary from community to community. Business consultants in Florida might not know how to answer questions about regulations in Oregon. Similarly, professionals in Oregon might not have the information needed to help Florida cannabis businesses grow without breaking laws unintentionally.

Avoid penalties by following recommendations from experienced consultants who understand your area’s laws.

4. Overcome Growing Pains That Hold Back Many Businesses

Most businesses experience growing pains when owners try to expand. Opening a new storefront, for example, requires more than paying for more real estate and staff members. The growing business also needs to make sure that it has enough merchandise to keep shelves stocked. If you expand too rapidly, you could find that you do not have enough suppliers to satisfy patients and customers. Suddenly, you find that you’ve spent a lot of money opening a store that can only operate for a few hours a day before it runs out of merchandise.

Other common growing pains experienced by expanding businesses include:

  • Changes in tax requirements.
  • Determining whether you need to give employees more benefits to match state and federal regulations.
  • The increased costs of distributing products to multiple locations.
  • Streamlining supply chains to keep costs low without experiencing interruptions.

Unless you’re prepared to tackle these issues on your own, you need a business consultant who has helped other companies overcome these issues.

5. Determine the Best Ways to Spend Money on Your Business

Your business has a set amount of money that you can spend on growth. What’s the most effective way to use your cash and credit? Should you spend money on marketing the products you have or open a new location to reach more customers? Does it make more sense for you to start manufacturing your own edibles and concentrates, or should you dedicate that money to securing merchandise from other companies?

You have a lot of questions to answer. A cannabis business consultant can review your financial situation, research growth opportunities, and synthesize the information to help you make a smart choice.

6. Identify Emerging Opportunities in the Cannabis Industry

The cannabis industry evolves quickly. More states seem to loosen their laws every year. As areas start to allow more medical and recreational cannabis, you could expand your business and attract more patients or customers.

Emerging opportunities can also include spending money on new products. Do you have a customer base willing to spend 10 percent more on high-quality strains promoted by celebrities? Perhaps that’s an area you should pay attention to. Your business consultant can help you figure out the right path to growth.

7. Avoid Common Mistakes That Ruin Businesses

A good business consultant will help you avoid some of the common mistakes that ruin many businesses. Some of those mistakes might include:

  • Taking on more debt than you can repay.
  • Growing too fast for you to maintain quality.
  • Hiring employees who won’t commit to doing excellent work.
  • Putting people in leadership positions without teaching them how to lead.
  • Setting up an employment package that does not attract the best candidates.
  • Choosing outdated technology because it’s cheaper – even though it will eventually hurt your business by slowing operations.
  • Following a flawed business plan.
  • Refusing to adjust to the industry as it evolves.

A cannabis consultant’s services probably can’t solve all of your problems, but they can make growth much easier by helping you avoid common pitfalls.

Choosing a Cannabis Business Consultant

Now that you know the seven reasons why cannabis business consultants are essential for growth, you need to know how to identify the right professional for your company. The following tips should lead you to a reliable person.

Tip 1: Find a Cannabis Business Consultant With Experience Working in Your Area

As mentioned above, the cannabis business has diverse laws that can vary from community to community. Unfortunately, it doesn’t look like that will change soon. Unless Congress acts to legalize cannabis products, states will continue dealing with this hodgepodge of regulations. At the moment, Congress doesn’t even recognize cannabis as a medical treatment despite ample evidence showing that it can curb symptoms of depression, anxiety, ADHD, Alzheimer’s disease, and many other conditions.

Because of this unfortunate situation, you should choose a cannabis business consultant with experience working in your geographic area. If you operate in Florida, find a cannabis business consultant in Florida. If you have a store or farm in Michigan, find a consultant based in Florida.

Don’t take any chances by hiring someone who might not understand the nuances of your local laws.

Tip 2: Know What Areas of Help You Need for Your Business

Since many business consultants focus on specific issues in business development, you should start your search by identifying what areas of help your company needs. If you aren’t sure what areas apply to your plans, talk to a general business consultant to get a clearer idea of what you can expect.

Tip 3: Always Ask Cannabis Business Consultants About Their Qualifications

Does a cannabis business consultant really have the experience you need to grow your company? Before you hire someone, ask consultants about their educational degrees, real-world experience, and other companies they have helped.

Tip 4: Get References Before You Hire a Consultant

Ask business consultants to give you references so you can contact other companies that have worked with them. Reach out to those businesses in the cannabis industry to talk about their experiences. If they were happy with the consultant, there is a good chance that you will also have a positive experience. If they have a lot of complaints, it’s probably safest to choose someone else.

Tip 5: Choose a Cannabis Business Consultant Willing to Focus on Your Company’s Needs

Business consultants should never put their needs first. The client’s business matters more than anything else. If you get the impression that a cannabis business consultant near you cares more about enriching themselves, keep interviewing people until you find someone you trust.

Tip 6: Follow Your Instincts but Use Your Brain

Hiring an excellent business consultant isn’t always a straightforward decision. Someone can look perfect on paper. Despite that, you get a bad feeling about them. The opposite can also happen: Someone you click with might not have the experience you prefer.

Remember that this decision will have a direct impact on the growth of your business. Making the wrong decision could hurt your profits substantially. You want to hire a cannabis business consultant that appeals to your instinctual gut and your analytical brain.

Tip 7: Always Get a Contract Before You Use a Business Consultant’s Services

You’ve found someone you think can help your cannabis business grow. Congratulations! Now, take the time to have a lawyer write a contract that defines everyone’s expectations in the relationship. The contract could include:

  • Bonuses for reaching milestones.
  • The number of hours the consultant will work for you each week.
  • A timeline for meeting goals.
  • How much money the consultant gets paid.
  • How you can protect your business from consultants that don’t commit to your needs.

Talk to a Cannabis Business Consultant

Find a cannabis consultant today by searching the the listings on 420property. The website does not provide business consultant services, but it can help you find a reliable consultant for your cannabis business.

June 9, 2021Comments Off
Do You Need a Cannabis Lawyer if You’re Buying a Dispensary?

Buying any type of business can get complicated quickly. Even a basic contract can include a lot of legalese that makes it difficult for investors to understand the agreement’s nuances. The process becomes even more complex when you want to buy a cannabis dispensary. Suddenly, you need to make sure you follow laws that often change significantly not only from state to state but neighborhood to neighborhood. You need a cannabis business lawyer to ensure you follow the law and get a good deal that leads to a profitable dispensary.

The Role of California Cannabis Lawyers When Buying a Dispensary

A California cannabis lawyer can fill a variety of roles depending on how involved you want to be in the buying process. Some entrepreneurs want to remain as anonymous as possible, so they ask their lawyers to:

  • Create business entities that obscure their involvement.
  • Represent them during meetings and negotiations.
  • Review contracts to identify errors and explain details.
  • Make initial payments for the dispensary and related assets, such as stock and equipment.
  • Talk to local lawmakers, council members, and other influential people to make sure you follow every rule precisely.

On the other hand, some dispensary buyers just want their lawyers to play auxiliary roles. If you’re comfortable with companies business opportunities and negotiations, you might need a lawyer to provide basic services like:

  • Reviewing and submitting documents.
  • Making sure the dispensary’s operations align with local laws.
  • Overseeing final negotiations when you sign a contract and pay for the dispensary.

Obviously, it costs more to have a lawyer who’s involved in every step of the process. Many entrepreneurs decide to pay the higher price because they don’t want to risk making any mistakes during the buying and licensing processes.

Cannabis Business Lawyers Could Help You Build Relationships

Cannabis business lawyers often know a lot of people in the industry. Having a good relationship with your lawyer, therefore, could make it easier for you to make connections that benefit your dispensary. For example, your cannabis business lawyer might know a new company that makes boutique THC and CBD products for high-end consumers. Adding these items to your shelves could expand your brand’s target audience by attracting customers and patients with disposable income.

Lawyers in the industry are often happy to help clients connect with each other. Doing so means that they can create more opportunities for growth within the local cannabis market. It can also mean generating more work that helps them earn money. If you decide to enter a business contract with another brand, you will almost certainly turn to the cannabis lawyer who introduced you. It’s a smart way for professionals to create win-win situations for everyone.

A Cannabis Business Lawyer Can Provide Ongoing Support

No matter where your new dispensary is located, you need to take the local laws seriously. You cannot depend on last year’s rules to guide your future decisions. How you handle everything from advertising to packaging products could change within weeks.

A lawyer that specializes in cannabis businesses can keep you updated with emerging regulations. Is now the right time to buy a dispensary in Los Angeles? Your cannabis lawyer can help you make that decision based on expected changes in the legal and business landscape.

You have a dispensary to run. That already takes a lot of time. You will want to keep up with the major laws that affect your business, but you probably do not have time to handle the small details.

A cannabis lawyer, however, gets paid by clients to do the hard work of reading current and proposed laws. You can use that expertise to help you make smarter business decisions. For example, you might want to avoid buying a dispensary in a San Diego community if its lawmakers are considering restrictions for next year. Your cannabis lawyer can advise you whether it makes sense to buy or wait to see whether the laws change in ways that would affect your business’s success.

Local Cannabis Lawyers Can Provide Counsel for Your Business

It’s important to find a cannabis lawyer near me because the laws vary so much from place to place. A cannabis lawyer in Los Angeles probably won’t know about the details of opening and operating a dispensary in places like Denver, Portland, or Detroit.

In fact, knowing the dispensary rules in Los Angeles doesn’t even ensure that a lawyer knows everything essential about operating a dispensary in San Francisco. Even independent communities with Los Angeles can have unique rules. West Hollywood, for example, has limited permits for cannabis restaurants. Qualifying eateries can pair cannabis blends with foods for a splendid dining experience. As of mid-2021, at least, no other city offers such an option for public cannabis consumption.

Ongoing counsel from a cannabis business lawyer will help ensure that your dispensary takes advantage of new opportunities, conforms to recently passed rules, and always stays within the laws. For example, your cannabis business lawyer might have helped connect your dispensary with a cannabis restaurant. If an opportunity exists, why not take advantage of it as long as you have excellent legal counsel from an authority on cannabis law.

Understand the Risks and Penalties of Violating Cannabis Laws

Unfortunately, dispensaries have so many rules to follow that they can unknowingly violate local laws. Perhaps you didn’t know that you couldn’t advertise your cannabis dispensary on a certain street. Maybe you didn’t know that your area only lets dispensaries sell cannabis products grown off-site. If you get caught violating these and other rules, you could face hefty fines. Even worse, you could lose your permit to operate your dispensary.

A cannabis business lawyer near me can help you understand the risks and penalties of violating cannabis laws. Ideally, you get straightforward, no-nonsense advice from your lawyer that helps you stay within the rules at all times. Knowing the consequences of straying from the law could give you the motivation needed to pay close attention to your business activities.

Find Solutions When Federal and Local Laws Conflict

You already know that local and federal laws conflict when it comes to cannabis products that contain THC. It’s very unlikely that the federal government will target you as long as you operate in a state with legal cannabis. If the Department of Justice were going to shut down dispensaries, it probably would have done so under the direction of Jess Sessions, a known prohibitionist with a strict stance against legal cannabis. That didn’t happen, so it probably won’t now.

The conflict between state and federal laws can still create challenges, though. Some banks worry about doing business with cannabis dispensaries. Credit processors might also have issues letting people purchase your products with their accounts.

Until Congress makes it clear that dispensaries can operate without worry, other businesses will take a cautious approach.

Working with a cannabis lawyer, however, can help you identify payment processors, banks, lenders, and other institutions willing to accept your dispensary as a legitimate business that deserves the same services as other companies. Not every lawyer has this level of experience. You need someone who understands the industry and how some local organizations collaborate with each other for success.

Find an Experience Cannabis Lawyer

Contact a cannabis lawyer now so you can reap the benefits of working with an experienced professional who understands your needs from legal and business perspectives.

Every business needs a lawyer to help them follow industry and employment guidelines. Few industries need experts like the cannabis sector, though.

View cannabis businesses for sale on 420Property.com.

June 6, 2021Comments Off
Tips to Succeed as a Cannabis & Hemp Real Estate Agent

Investors and entrepreneurs entering the cannabis and hemp industry often need help from real estate agents familiar with properties that can support their business plans. Succeeding as a cannabis real estate agent or hemp real estate agent often means finding ways to exceed the expectations of your clients. That’s easier said than done if you’re new to the industry. The following tips will help beginner and experienced agents succeed in this growing market.

Get the Qualifications You Need to Sell Real Estate in a Green Zone

You will need to get a real estate agent’s license before you can start working with clients independently. The steps to getting your real estate agent’s license varies somewhat from state to state. In California, for example, the process involves:

  • Completing at least 135 hours of pre-licensing education.
  • Signing up for the salesperson exam.
  • Submitting your fingerprints for a criminal background check.
  • Getting a sponsorship from a currently licensed broker in California.
  • Scoring 70% or higher on the real estate salesperson exam.

Look up the requirements for your state so you can take the necessary steps toward qualifying for real estate agent jobs.

Some states have reciprocity agreements with other states. That means getting licensed in one state means you can conduct business in those with reciprocity agreements. Again, the rules can vary significantly from place to place. California does not have reciprocity with any state. Colorado, however, has full reciprocity with all states. If you’re qualified to work as a real estate agent in any U.S. state, you can also work in Colorado.

If states near you do not offer reciprocity, you may want to get licensed to work in more than one state. The option to sell and rent property in more than one state should make it easier for you to attract clients and help them find real estate that matches their needs.

Find a Mentor Who Can Show You How to Succeed

Cannabis and hemp real estate is a very “hands-on” industry. You will learn some of your most important lessons on the job. Lower the number of mistakes you make by finding a mentor who can show you how to succeed.

A mentor can help in several ways, such as:

  • Telling you how to spot signs that indicate a deal probably will not close.
  • Teaching you how to tell the difference between mediocre and excellent green zone properties.
  • Helping you navigate the complicated legal landscape that surrounds the cannabis industry in many states.
  • Introducing you to real estate agent jobs that normally go to more experienced people.

How do you find a mentor? Start by identifying professionals in your area you respect. You can also go to conferences and other professional events to meet people who interest you.

Perhaps most importantly, make sure others know that you want to learn from a mentor. You don’t want to come across as needy, but you do want to show that you take your career seriously and understand the importance of mentorships.

Understand the Diverse Needs of Cannabis and Hemp Real Estate Investors

Real estate agents for rentals and sales need to understand the diverse requirements of clients that want to work in the cannabis and hemp industry. Needs are specific to each client, but you can divide them into a few general categories, including:

  • Residential acreage
  • Warehouses with existing systems for indoor growing
  • Industrial spaces for making cannabis products and storing merchandise
  • Farmland for growing cannabis and hemp outdoors
  • Greenhouses for sale that can extend the growing season
  • Commercial and retail spaces where companies can sell to patients and customers

At first glance, this might not seem very difficult. How hard is it to find an attractive retail space in a high-traffic area? That might depend on local ordinances that dictate where cannabis and hemp retailers can operate. Some communities in states with legal cannabis do not allow any dispensaries or cannabis retail stores. Others have fairly permissive laws that make it much easier for companies to reach their customers.

To really understand the needs of hemp and cannabis real estate clients, you should also learn about topics like agriculture, hydroponics, and extraction equipment. The more you know, the more helpful you become as a hemp and cannabis real estate agent.

Market Your Expertise to Attract More Clients

Once you have an expertise in cannabis and hemp properties, you can use your experience to attract more real estate agent jobs in the industry. Many people find that they can market themselves effectively by:

  • Starting professional websites where they can publish blog posts to build authority and increase organic search traffic (make sure you include long-tail keywords like “cannabis real estate agents near me” and “cannabis real estate agents for rentals”).
  • Writing guest posts for industry websites, newsletters, and blogs.
  • Posting to popular social media platforms, including options like LinkedIn that focus on professional relationships.
  • Advertising your services on professional directories.
  • Staying in contact with previous clients by sending them cards and emails for special occasions.

More companies and investors are looking for real estate agents with rentals and property for sale. At the same time, more real agents are getting involved in the industry. Make yourself stand out so you can attract clients before your competitors can.

Connect With Renters, Buyers, and Sellers to Build Relationships

You cannot overestimate the importance of building relationships in the real estate industry. Getting real estate agent jobs is often as much about who you know as how much experience you have.

Many real estate agents find that they thrive financially by putting clients ahead of their revenue goals. Instead of focusing on closing deals, try to establish relationships between as many people as possible. That could mean taking time out of your busy schedule to introduce a potential buyer to an investor or private lender. You don’t know that you will profit from the introduction, but you will establish yourself as a trustworthy, helpful person willing to put other people’s interests ahead of your own. In the long run, this approach often means you gain the reputation needed to succeed in real estate and cannabis.

Advertise Your Services and Listings on 420Property

Start advertising your listings and services on 420Property.com for free. You can also increase your exposure by upgrading to a Featured Listing, adding a Social Boost, or getting a Dedicated Email. Learn more about advertising your services on 420Property.com so you can choose an option that fits your budget and professional goals.

June 4, 2021Comments Off
The Process of Listing Your 420-Friendly Warehouse for Rent With 420 Property

420 Property can help you connect your 420-friendly commercial rentals to investors and cannabis business owners across the United States. Before you can rent 420 grow locations to businesses and individuals, though, you need to know the most effective ways to list your properties on the website (above and beyond verifying that the property is suitable for legal cannabis business operations).

Do your best to follow every step in the following process. The more complete your 420 friendly commercial rental listing looks, the more likely it is that you will attract a responsible tenant who wants a long-term business relationship that benefits you both.

Take High-Quality Pictures of Your Warehouse’s Interior and Exterior

You will need written content to attract companies that want to rent 420 grow locations, production facilities, and storage warehouse spaces. Before you start thinking about how you will describe your building and the spaces available inside it, though, you need to take high-quality photographs and add them to your listing.

Most people are visual learners. When they see pictures, they can’t prevent themselves from stopping to look. Photographs also provide a wealth of information about your real estate. As the saying goes, “a picture is worth a thousand words.”

By adding pictures to your listing, you make it more likely that people will:

  • Stop to learn more about your 420 friendly commercial rentals.
  • Scroll through your images to help them decide whether you have a facility that matches their needs.
  • Contact you to make sincere inquiries about renting space in your warehouse.

Imagine how a similar scenario could play out without images:

  • Someone happens to see your listing.
  • They contact you to arrange a meeting time.
  • You go to your warehouse and show them around.
  • The potential tenant decides it isn’t the right option for them.

You’ve just wasted a lot of time that you could have saved by posting a few pictures.

Add Video That Gives Interested Renters a Quick, Online Walk Through

Make your images even more effective by adding video to your property listing. Instead of showing what individual spaces look like, you can provide a virtual walk-through of the warehouse.

During the video, you can describe the rooms you walk through. Perhaps you mention how many electrical outlets a space has. Maybe you point to a ventilation system you installed to help indoor cultivators grow healthier plants.

If a picture is worth a thousand words, how much is a video with commentary worth? 100,000 words? A million?

Regardless, adding video to your listings will do wonders at attracting and educating potential tenants.

Provide Accurate Pricing Information

Never provide misleading pricing information for your 420 friendly warehouse for rent. Give people accurate prices and tell them your expectations.

You might have several spaces in your warehouse that you want to rent. If so, the rental prices probably vary by size, available equipment, location, and other factors. Create a separate listing for each space so you will not confuse interested renters about the price.

Setting accurate expectations now will form the bedroom of your owner-tenant relationship. Imagine that someone comes to your warehouse to ask about renting a 420 grow location. You say that you have a room available at $2.50 per square foot. The person counters that they saw an ad that said $2 per square foot. “Oh, that’s for the third-floor room,” you respond.

At this point, you have probably lost a tenant by undermining that person’s faith in you. If you’re willing to mislead interested parties in the price of a warehouse space, who’s to say that you won’t try to pull other tricks in the future.

Set a fair price based on your facilities and area averages. Then, advertise your prices accurately. You do not want to start a business relationship with anything other than 100 percent honesty.

Add a Description That Optimizes Keywords

Why write a description of your 420 friendly warehouse for rent? You have at least two reasons to spend time crafting a compelling, accurate description of your space.

First, you can use your description to include keywords that will help search engines find your listing. Make sure you add location-specific keywords. Some options include:

  • 420 friendly rooms for rent near me (you could replace “me” with the name of your city or neighborhood).
  • 420 friendly commercial rentals
  • Cannabis warehouse grow locations
  • Rental space for growing cannabis
  • Warehouse rental for cannabis

Depending on your facility, you might also add keyword phrases like:

  • Fully air-conditioned and heated cannabis warehouse
  • Irrigation system for cannabis
  • LED lights for growing cannabis
  • Extraction equipment on-premises

Think about what makes your warehouse space special. Anything that occurs to you will probably make a good keyword that attracts potential tenants.

Second, you want to write a description of your 420 friendly warehouse for rent because some people prefer to learn by reading. Your photos and videos might help them understand what you offer. For some learners, though, nothing beats reading text.

If you don’t feel comfortable writing compelling descriptions of your rental space and rental agreement, consider hiring someone to do that job for you. It often costs very little. In return, you get to captivate readers with professionally written text that converts them into paying tenants.

Answer Questions About Your 420 Friendly Commercial Rentals Accurately

Your listing will prompt you to provide a lot of information about your 420 friendly commercial rentals. Some pieces of information you should complete include:

  • Size
  • Lease type
  • License type
  • City tax rate
  • Available utilities
  • Owner’s name (use a company name if it owns the property)
  • Contact information (phone and email) so people can reach out to you with questions

The more information you provide in the listing, the fewer questions you will get from people who ultimately decide to choose a different location. For example, someone who wants to know whether your building uses natural gas or electricity will call or email you to ask the question. Answering takes a few minutes out of your day. You could have saved yourself time and effort by listing all types of utilities available at your property.

Answer as completely and accurately as you can. Doing so will reduce the overall amount of work that you do filling spaces and managing tenants.

Double Check Your Contact Information so You Don’t Miss Requests

This might sound very obvious, but people make mistakes all of the time when they list their contact information.

Inaccurate contact information makes it impossible for potential tenants to reach you. Someone who wants to give you money is trying to contact you. Unfortunately, they can’t because you didn’t double-check your contact information.

Upgrade Your 420 Property Listing to Reach More Renters

The 420 Property website will let you add free listings for hemp and cannabis properties. Only Premium Subscribers can see your free listings, though. That means investors casually browsing the website will not see your 420 property for rent.

You can make it much easier for people to find and rent your warehouse spaces by upgrading your listing.

Featured listings are available to everyone who comes to 420poperty. Spending a little money on a featured listing also gives your placement a boost by placing you within the top search results.

Other benefits of choosing a featured listing include:

  • Guaranteed social media exposure that will reach more people.
  • No broker advertisements that will district visitors.
  • Listing placement on the homepage and sidebar.
  • Distributed listings to CannabisMLS.com and the site’s RSS subscribers.

Social Boost

Want even more from your listing? Get a social boost so 420property will share your listing on all of its social media sites. The more people you reach, the more likely it is you will find a tenant as soon as possible.

Dedicated Email

Not everyone pays attention to social media posts. At 420property, we have more than 20k email subscribers. Upgrading to dedicated email gets your warehouse space rental in front of thousands of people.

Email advertising still plays a critical role in business growth. For a nominal fee, you can attract renters and start making more money within days, weeks, or months.

Help Companies Rent 420 Grow Locations

You have 420 properties in northern California and other locations that you need to rent to businesses. Luckily, plenty of businesses want to rent 420 grow locations for cultivating cannabis indoors. They may also want to use your warehouse to extract chemical compounds, make oils, and store products before shipping them to stores.

Help them find a warehouse that matches their unique needs by listing your property on 420property.com

June 2, 2021Comments Off
How to Find Green Zone Properties Near You

Green zone properties include real estate in areas that allow cannabis cultivation or sales. No matter what type of cannabis business you want to start, you will need to find green zone properties for sale. There’s a lot of competition to purchase the best real estate, so you need to know how to find the best green zoned properties near you.

Step 1: Know What Type of Green Zone Properties You Want

Green zone properties fall into several categories. The options that you focus on will depend on the type of business you want to start.

Cannabis cultivation usually requires investing in farmland or warehouse space equipped with irrigation, fertilization, and lighting systems. If you prefer farmland, it makes sense to look for zoned properties that already include infrastructure like greenhouses, irrigation systems, and storage facilities.

Selling cannabis products to patients and customers, however, will require a storefront. Cities and communities often have limited permits for cannabis dispensaries. Make sure green zone properties for sale in Michigan and other states also have available permits. Otherwise, you could end up buying or leasing space that you cannot use to sell cannabis products.

Step 2: Explore Reputable Green Zone Property Listings

You don’t necessarily want to lease or purchase the first green zone properties in Michigan and other states that you find. You can use 420 Property to compare several options in your area. That way, you get to narrow your choices to the green zone properties that meet your needs.

Step 3: Talk to the Property Owner or a Real Estate Agent

When you are ready to buy or lease green zoned properties, you need to reach out to the owner or a real estate agent. Whether leasing or buying, you will need to fill out and submit several documents. You might also need to show that you have funding for the property.

Talking to an experienced cannabis real estate agent can often help streamline the process. A real estate agent already knows the steps involved, so they can make it as easy as possible.

You don’t have to use a cannabis real estate agent. It’s possible to purchase or lease directly through the current owner. Many investors find that they enjoy the convenience and professionalism they get from relying on a broker, though.

Find a green zone property now! You could soon find the right property to make your business successful.

June 2, 2021Comments Off
Why Cannabis and Hemp Businesses Should Have Insurance

Owners of cannabis and hemp businesses need insurance to protect their interests, just as business owners in all other industries do. The legal status of cannabis operations makes acquiring insurance complicated, however. Federal law still makes growing and selling cannabis and hemp illegal, no matter what its purpose. A number of states now have laws on the books that makes medical cannabis legal. Others, like Colorado, also allow cannabis for recreational use. Still others have decriminalized marijuana, making enforcement of the laws less likely. Under the Obama administration, the federal government had a “hands off” policy toward cannabis and did not enforce federal law in states that made cannabis legal. Although AG Jeff Sessions had expressed a desire to change this policy, the current administration is still following Obama era guidelines. Unfortunately, the legal situation understandably makes most insurance companies leery of industry involvement. Cannabis is still not a “safe” product to cover. 

Cannabis and Hemp Business Risks

In addition to the state and federal legal issues, the industry poses additional challenges. Producers and retailers must meet strict guidelines and safety regulations to meet state requirements. Also, some in the business are attempting to shift from illegal to legal production, which makes attaining insurance even more difficult. Traditional insurance providers have little interest in assuming these risks. Also, since these products are ingested, business owners are at risk for various consumer complaints. Inevitably, someone will claim that the cannabis made them ill in some way. Purchasers may also claim financial losses that can leave these cannabis operations vulnerable. Operating without insurance means that even one claim could place the business under extreme financial pressure or even cause it to fail. Recent severe weather events have proven how vulnerable cannabis and hemp operations are without coverage. Many producers in Florida and Puerto Rico lost their crops to hurricanes, while California producers suffered huge losses from wildfires. Without insurance, they were forced to absorb all of the financial liability themselves.

Types of Coverage

Expert opinion is that those in the cannabis business need the full spectrum of business insurance coverage, including general liability to protect against slip and fall accidents, advertising issues and other problems that every company faces. In addition, these businesses need product liability and workers compensation coverage. Cannabis company owners also need business personal property coverage and possibly commercial auto coverage, product recall coverage, etc. To be properly protected, cannabis entrepreneurs need comprehensive insurance policies. Otherwise, they could easily be responsible for millions in consumer claims.

Insurance Options

Some solutions do exist for those in the cannabis industry. For instance, captive insurance companies (CICs) are legally licensed insurers who sell insurance to affiliated businesses. They are not allowed to sell coverage to the public, however. Because their focus is narrow, they are more efficient to organize and run, which allows them to take on cannabis risk and still be profitable. These companies, which are also used to cover auto manufacturers, workers compensation, landlord’s property, armored cars, etc., can even cover product recalls, employee theft and legal defenses. They are a proven way to provide niche coverage to non-standard businesses, so they are an excellent fit for the cannabis industry. California is making the biggest effort to provide insurance to the industry. The state has established Cannabis Business Owners Policy (CannaBOP). The brainchild of the American Association of Insurance Services, CannaBOP offers property and liability coverage for manufacturers, processors, distributors, and other members of the cannabis industry. While this program helps address the insurance gap, many in the industry still operate without enough coverage or any coverage at all. Recently, a major company began providing insurance for California property owners who lease to tenants in the cannabis industry, another step toward making cannabis and hemp an accepted business. Landlords will be much more inclined to lease their properties to producers and retailers if they can maintain proper insurance coverage and minimize their risk. In 2018, the NAIC ( National Association of Insurance Commissioners) noted the difficulties in providing cannabis and hemp business coverage and acknowledged that California was leading the way in this type of insurance. The NAIC is still formulating ways to meet the needs of the industry without exposing themselves to federal legal issues.At present, finding a major “name” company to cover a cannabis/hemp business is difficult if not impossible in some areas. Much depends on the moves the federal government makes in the coming years. Currently, the administration has backed off federal enforcement of marijuana laws in states that have legalized the substance. If this policy continues or the government decides to legalize cannabis, then, of course, insurance coverage will be far easier to get. At this juncture, captive insurance is the best bet for many in the industry. This type of insurance will provide owners with at least some of the coverage they need. Those companies in California have a distinct advantage, because the state is working with cannabis businesses to provide insurance coverage, primarily from CannaBOP. Currently, there is no easy solution for other cannabis companies in the United States, although progress is continuing to be made.

Get a cannabis insurance quote today.

June 2, 2021No comments
What Is the Process of Obtaining 420 Friendly Properties?

Whether you want to open a recreational or medical marijuana dispensary, start an outdoor hemp farm, or begin cultivating cannabis strains at an indoor farm, you need to understand the process of obtaining 420 friendly properties.

Keep in mind that laws vary significantly from state to state. In fact, laws often vary a lot from city to city. The details of finding 420 properties in northern California, therefore, don’t look exactly the same as obtaining 420 properties in Michigan.

The following guide will put you on the right track to finding, comparing, and obtaining 420 properties for lease and sale. Make sure you know the rules that affect cannabis businesses in the property’s jurisdiction before you commit any money. You may want to talk to a cannabis lawyer to help you make the decision.

Know What Features You Need in 420 Properties

Your search for the perfect 420 property starts with identifying the features that will help make your business successful. What you need from cannabis real estate will depend on the type of business you want to open. Some of the most common green zone real estate options include:

  • Commercial farmland for outdoor cannabis or hemp cultivation.
  • Residential farmland for outdoor cannabis or hemp cultivation.
  • Greenhouses that extend the growing season and improve growing conditions for cannabis or hemp.
  • Warehouse space for indoor cannabis cultivation.
  • Industrial space for extraction and production.
  • Commercial retail space for selling to patients and consumers.

Take a look at some of the specific features you might want from each of these property options.

Farmland for Outdoor Cultivation

When comparing farmland for outdoor cultivation, many investors look for features like:

  • Irrigation systems.
  • Access to utilities (water, electricity, etc.).
  • Soil acidity between 5.8 and 6.2, which is suitable for hemp and cannabis cultivation.
  • Buildings for storing equipment.
  • Farmhouse for staying on the property.
  • Proximity to a population, which makes it easier to hire workers.
  • Access to major roads for shipping products.

Any missing features could add to your overall investment since you might need to pay for adding them. While you might not mind having a 420 property away from a major road, access to water is critical. Without it, you could lose millions of dollars in crops.

Greenhouses for Hemp and Cannabis Cultivation

Greenhouses can help you control the growing environment for hemp and cannabis. When comparing greenhouses for hemp and cannabis cultivation, consider factors like:

  • The age of the greenhouse.
  • How much acreage the greenhouse covers.
  • The greenhouse’s build material.
  • Whether the greenhouse already has a heater for growing during cold months.

Greenhouses are often supplemental to larger farms. You might only use the greenhouse to start transplants that you later move to outdoor land. Depending on the temperature, you could also use the greenhouse to grow smaller amounts of cannabis during winter.

Warehouse Space for Cultivation

Warehouses have become popular options for indoor cultivation. When exploring 420 properties in Michigan, Colorado, and other places with cold seasons, it makes sense to move production inside instead of dealing with changes in weather and temperature.

You can buy a green zone warehouse and convert it into an indoor cultivation center. That requires a lot of work and money, though. When possible, investors often prefer 420 properties for lease and sale that already have irrigation, lighting, and nutritional systems in place. That way, they can start cultivating immediately without updating the space.

Industrial Space for Production

Industrial space can serve several purposes for hemp and cannabis businesses. You might use the green zone space to cure flowers before sending them to dispensaries. You can also use the areas to extract cannabinoids and terpenes from raw plant materials. Once you extract chemical compounds like THC and CBD, you can make products like edibles, tinctures, and oils.

When exploring 420 properties for lease or sale, look for options that have enough room for your extraction equipment. You will also need room for storing solvents and your finished products.

Other factors that might influence your decision include:

  • The space’s electrical system
  • Location near retail or shipping centers
  • Security systems

Commercial Retail Space

Commercial 420 properties in California, Michigan, and other states make it possible for retail stores and medical dispensaries to serve consumers.

Most businesses want their commercial retail spaces to have features that appeal to consumers, such as ambient lighting, large rooms, and pleasing décor. More importantly, local regulations can require some features for your commercial retail space. These features often include:

  • Single entry and exit points for shoppers.
  • Separate lounges to limit the number of people inside the salesroom.
  • Computer systems that track inventory.
  • Security systems that prevent theft.

Always make sure you know your local requirements before opening a dispensary for medical or recreational cannabis products. Otherwise, you could face hefty fines or even lose your permit.

Understand Permit Requirements in the Property’s Jurisdiction

Permit requirements add a frustrating level to obtaining 420 properties that can help your business succeed. Unfortunately, the cannabis industry can only exist in the U.S. while it follows strict regulations. As of mid-2021, state and federal laws often conflict. While you can buy 420 properties in northern California and operate legally, the federal government considers the operation illegal.

States must take their regulatory requirements seriously to appease the federal government (and state legislators who prefer cannabis prohibition).

The National Conference of State Legislatures offers synopses of cannabis laws in each state. It’s a great introduction to laws that can help you choose a state for your business.

For more information, though, you will need to consult local laws. They do not always agree with state laws. In many cases, state laws set minimum regulations that investors and businesses in the cannabis industry must follow. Municipal governments can establish additional requirements and restrictions. They have the power to fine businesses and take away permits/licenses, so pay close attention to community regulations. Otherwise, you risk losing your investment—and possibly even more.

Does Your Area Have Tier Levels for 420 Licenses?

When you look at listings for cannabis properties for lease or sale, you might see tier levels listed. Some states, including Washington, have different tiers that define how cultivators and dispensaries can operate. Using Washington 420 tiers as examples:

  • Tier I licenses typically appeal to small, indoor farms that want to grow high-quality medical or recreational cannabis in canopies up to 2,000 square feet in size.
  • Tier II licenses usually go to indoor warehouse cultivators that use mid-sized canopies between 2,000 and 10,000 square feet.
  • Tier III licenses go to the largest farms (indoor or outdoor) that want to sell a broad range of cannabis products to consumers in multiple markets. They often have canopies between 10,000 and 30,000 square feet in size, which means they have significant control over pricing and product trends in the industry.

Most jurisdictions have their own versions of tier levels/ They may also refer to them as “grade levels.” Make sure you know the licensing limits for permits in your business’s area.

Compare Your Funding Options for Buying or Leasing 420 Properties

Finding 420 properties that interest you is rarely the end of the process. Next, you need to compare your funding options.

Cannabis retail spaces can easily cost more than $1 million to purchase. Unless you have a few million dollars available, you will probably need to seek a funding option. You can also consider 420 properties for lease, but you will still need to spend quite a bit of money upfront on equipment, staffing, security, and retail products.

Funding a cannabis business poses several challenges. Many banks worry that they will violate federal regulations by working with companies that technically break federal law—even when those companies follow state law closely. A traditional funder’s reluctance can make it hard to obtain the money you need to start your business.

Many investors turn to private commercial lenders that do not need to worry as much about federal regulations.

What You Can Expect to Learn From 420 Friendly Property Listings

Buying or leasing cannabis property usually means that you need to compare several opportunities before you find one that fits your requirements. You probably have a certain property in mind right now (e.g., a storefront in West Hollywood, a rural farm with rich soil and access to water, or a warehouse that you can equip with the systems needed for indoor cultivation). You want to find a listing that matches your ideal as closely as possible.

When you compare property listings, you can expect to find certain types of information. Some information that you should pay close attention to includes:

  • The asking price of the property.
  • The property’s listing type (e.g., cannabis & hemp real estate, warehouse/industrial for sale, and cannabis & hemp real estate for lease).
  • The property’s listing status (active or inactive).
  • The size, which typically refers to the size of indoor space written as square footage.
  • The lot size, which is usually the amount of outdoor acreage included with the property.
  • Available power (e.g., “3 phase,” a common listing for buildings and other properties that have access to electrical grids).
  • Whether you can grow cannabis, hemp, or both plants on the property.
  • The type of license currently associated with the property (e.g., recreational, medical, or recreational and medical license).
  • The city tax rate (this is usually the name of the city that sets the property’s tax rate, not the actual tax rate as a percentage. You may need to contact the city to get the latest tax rate for the type of business you plan to operate).
  • Sale type, such as whether the current owner will accept cash, financing, or owner financing.
  • The utilities available on the property, such as electricity and water access.
  • The name of the current owner, which is often listed as a company rather than an individual.
  • The owner’s contact information (e.g., phone number and email address).

Buying vs. Leasing Cannabis Properties

As you explore your cannabis property options, you will likely notice that some of the real estate is listed as “for sale” while others are listed “for lease.” It’s critical to know the difference between these options and how they can affect your business plan.

When you buy cannabis properties in California, Michigan, and other states, you own the real estate, including buildings and land. More likely than not, you will need to fund your purchase by getting a loan. Making monthly loan payments isn’t the same as leasing (more on leasing below) because you own the property after you finish repaying the loan. Once you own the property, you only need to pay taxes to your municipal government, assuming that it charges property tax.

With leasing, you agree to pay the property owner a certain amount of money each month. You and the owner will sign a contract that explains the monthly price, how you can use the property, and how long the lease lasts. Leases often operate on a year-by-year basis, but you can make other arrangements with some owners.

Benefits of Buying Cannabis Properties

  • You own the property, so you can improve it without getting someone else’s permission.
  • You can sell the real estate to earn a profit.
  • You have a lower chance of losing your investment.

Disadvantages of Buying Cannabis Properties

  • You might need to make a sizable down payment before you can take ownership of the property.
  • You have to pay property taxes in most areas.
  • You’re responsible for maintaining the property.

Benefits of Leasing Cannabis Properties

  • You get to avoid high down payments.
  • You are not responsible for maintaining the property.
  • You don’t pay property taxes.
  • You can leave the property when your lease ends.

Disadvantages of Buying Cannabis Properties

  • You will never own the property.
  • You might need to seek permission before making changes to the property.
  • Prices will likely increase over time.

Find a 420 Friendly Property Listing That Meets Your Needs

Find a listing for the type of 420 friendly properties that interest you on 420property.com. The website can also help you connect with real estate agents, cannabis real estate lawyers, business consultants, property appraisers, insurance providers, financiers, and other professionals who can help make your investment successful.

June 2, 2021Comments Off
Cannabis Business Loans | Things to Consider Before Applying for a Cannabis Business Loan

Apply for a cannabis business loan follows nearly the same process as applying for other types of business loans. Entrepreneurs interested in opening farms, manufacturing facilities, delivery services, and storefronts will likely encounter a few small differences. Overall, anyone who has applied for a business loan before will recognize the process when seeking money to open or grow a cannabis business.

Business leaders who have not applied for loans, however, might feel some anxiety as they borrow money from banks and private lenders. The following things to consider can help entrepreneurs prepare for the cannabis business loan process and, hopefully, secure funding for their ventures.

Lenders Can Consider Personal Credit Scores Before Approving Loan Applications

Lenders usually perform hard credit checks to determine whether they should risk lending money to business owners. Cannabis business owners can prepare for credit checks by requesting copies of their credit histories. Any person can get one free credit report per year from the major credit reporting agencies (Equifax, Experian, and TransUnion).

Correcting Errors on a Credit Report

Ideally, business owners should request their credit reports several months before they apply for loans. If any of the reports contain inaccurate data, it can take weeks or months to petition the credit reporting company for a correction.

To correct errors:

  • Send a dispute letter to the company that lists inaccurate information.
  • Wait for the credit reporting agency to conduct an investigation and write a report.
  • Send a dispute letter to the company or person that reported the inaccurate information.
  • Wait for the reporting company to contact the credit agency to fix the mistake.

About one in five people have errors in their credit reports, so every entrepreneur should scrutinize their reports before applying for loans.

Improving Credit Scores

A loan applicant’s credit score can affect whether the person receives a loan and how much interest the lender charges. People with higher credit scores tend to enjoy higher acceptance rates and lower interest rates.

Applicants without “Very Good” or “Excellent” scores, usually defined as 799 to 850, have better chances of securing low-interest loans.

Anyone with a score under 799 should try to improve the rating before applying for a business loan. Some of the fastest ways to increase credit scores include:

  • Making all payments on time (including credit card, car loan, student loan, and utility payments) to establish a trustworthy payment history.
  • Reducing the debt to credit ratio by repaying high-interest debt and keeping the accounts open.
  • Applying for a mixture of installment (car loan, mortgage, etc.) and revolving (typically credit card) accounts.

It takes time to improve credit scores. Ideally, business owners will give themselves several months or a year to repair their scores.

Lenders Will Want to See a Detailed Business Plan

Anyone who wants to borrow money to start or grow a business needs to prepare a detailed business plan that shows potential lenders how the enterprise will generate enough revenue to repay the loan. An effective business plan should include at least nine sections:

  • An executive summary that provides a brief overview of the business’s goals, market, growth potential, competition, and funding requirements.
  • Overview and objectives that go into detail about what the cannabis business will achieve.
  • Products and services that the cannabis business will offer that make it stand out from similar companies.
  • Market opportunities that describe an area’s need for the cannabis business and room for expanding into other areas.
  • Sales and marketing opportunities that will attract consumers or clients to the cannabis businesses.
  • A competitive analysis that describes the challenges and opportunities presented by other cannabis businesses in the area.
  • An operations plan that shows how the business will control expenses, fulfill consumer needs, hire experienced employees, and generate profits. This section should also include information about potential locations as well as the permits and licenses required to operate the cannabis business.
  • A description of the business’s management team and how each person will contribute to the venture’s success, including previous experience in the industry.
  • A detailed financial analysis that includes a balance sheet, income statement, cash flow statement, operating budget, and break-even analysis.

A well-made business plan can become the difference between getting approved or denied a loan. Business owners without much experience writing business plans should consider hiring consultants. Writing an accurate business plan means that owners need to reveal the positive and negative aspects of their companies. Even experienced entrepreneurs can struggle to remain objective while writing new business plans, so it makes sense to hire a consultant to at least assist in this portion of the funding search.

Understand Licensing and Permit Requirements

Licensing and permit requirements for cannabis businesses can vary significantly from state to state. Anyone who wants to start a farm or dispensary needs to understand the state’s requirements.

Many states and cities limit the number of permits that they will distribute. Limiting the number of permits helps prevent cannabis storefronts from crowding out other businesses. It also helps lower competition between dispensaries. A cannabis storefront will struggle to survive on a street that has a dozen other dispensaries within walking distance.

Entrepreneurs can learn more about licensing and permit requirements by visiting the cannabis portals of various states, including:

All states with medicinal and recreational cannabis have pages that can help business owners learn more about their licensing processes. Entrepreneurs should consult the state pages to become familiar with the process. They might also want to talk to lawyers or consultants in the cannabis licensing industry for additional help. Missing even one piece of information can delay an application significantly.

Prepare a List of Expenses the Cannabis Business Loan Will Cover

A detailed business plan should include all of the business’s anticipated expenses. Entrepreneurs applying for cannabis business loans should also make a separate list of expenses that they expect the loan to cover.

Some common expenses for cannabis dispensaries include:

  • Legal fees
  • Insurance
  • Commercial real estate rental
  • Property improvement
  • Marketing (signage, websites, online ads, etc.)
  • Security system with video cameras and metal detectors
  • Software
  • Furniture and displays
  • Office equipment (computers, copy machines, safes, etc.)
  • Security guards
  • Payroll
  • Taxes
  • Inventory and packaging

Common expenses for cannabis farms and grow operations include:

  • Farm equipment (tractors, wheelbarrows, etc.)
  • Land rental or purchase
  • Grow lights
  • Irrigation systems
  • Fertilizers
  • Employees
  • Security guards
  • Security systems with cameras
  • Fencing
  • Insurance

Even a small retail location or farm can cost $1 million or more to start. Detailed descriptions of how businesses plan to use borrowed money can make lenders more likely to accept applications, especially when the borrowers show that they already have considerable funds to pay for large expenses.

Provide Collateral, If Possible

Lenders want to mitigate risk as much as possible before accepting business loan applications. That fact applies to all businesses, not just those in the cannabis industry. The more collateral a person has, the more likely the lender is to accept the loan application. Having more collateral can also influence the interest rate that a lender charges the borrower.

Collateral can include any asset that the lender can convert to cash when the borrower fails to repay a loan. Lenders tend to favor assets that they can liquefy as quickly and easily as possible. Lenders consider cash the best type of collateral, although the business owner may need to put the cash in a secured bank account to ensure it doesn’t get spent before repaying the loan.

Other acceptable types of business loan collateral include:

  • Certificates of deposit (CDs)
  • Treasury debts
  • Corporate bonds
  • Real estate, such as homes or other business properties
  • Undeveloped land
  • Equipment
  • Inventory

Borrowers that plan to purchase land or buildings for their cannabis buildings might be able to use the new assets as collateral. In this situation, the lender would simply take the property when the borrower doesn’t repay the loan.

Cannabis business owners should expect their loans to have liens that make it possible for lenders to sue them for defaulting on loans. The lien can focus on a specific asset or group of assets. Blanket liens can include everything owned by the business.

Get Ready for a Long Process That Could End With a Rejection

Banks are cautious about lending money to new businesses. Most applications get rejected. Cannabis business owners often face additional scrutiny because they work in a “high-risk” industry. Federal laws make it even more difficult for banks to give loans to cannabis businesses. Since the federal government considers all forms of cannabis illegal, many lenders worry that they will get fined or prosecuted for working with companies in the industry.

Cannabis business owners should prepare to answer several rounds of difficult questions before they receive funding. Applicants should know as much about their businesses as possible. It often helps to bring a lawyer, business manager, or consultant to meetings with potential lenders. Failing to answer questions will worry potential lenders, which makes it unlikely for them to release funding to the business.

Business loan applications rarely get accepted quickly. It could take months of collecting documents, revising business plans, and talking to loan reps. Even after months of preparation, the lender could back out at the last moment. Every entrepreneur should expect rejections before finding the right lender for their business.

It’s a long, difficult process. But it’s often the only way to pay the upfront expenses needed to start a cannabis business.

Compare as Many Offers as Possible for Better Terms and Lower Interest Rate

Securing a cannabis business loan takes a lot of time and effort. Business owners shouldn’t take the first offers they receive, though. After weeks or months of searching, any offer may look tempting. It almost always pays to get more offers and compare them.

Interest rates for business loans typically fall between 2.58% and 7.16%. Some lenders charge up to 20% for borrowers in the cannabis industry. Loans typically get repaid within 18 months.

Even a few percentage points can make a big difference in the amount of money borrowers spend repaying their loans.

A business that borrows $1 million with an 18-month term loan and a 5% interest rate will spend about $40,050 in interest. This scenario assumes that the borrower doesn’t pay any origination, documentation, or other fees.

The same loan with a 7% interest rate will cost the borrower about $56,330 in interest. Just two percentage points can save a borrower more than $16,000 over 18 months.

Lenders that charge 20% on 18-month interest rates create a serious burden for cannabis businesses. The interest for that loan comes to about $165,738. That’s more than $13,800 per month in addition to the $1 million that gets repaid over 18 months. Few new businesses earn enough revenue to pay such high rates.

By shopping around for better rates, cannabis entrepreneurs improve their chances of success by lowering the amount of money they spend repaying their loans each month.

Conclusion

The cannabis industry has grown quickly in recent years as more states legalize the plant and its concentrates for medical and recreational uses. Cultivators and dispensaries have opportunities to generate significant wealth, but starting companies requires funding that few people have on hand.

Business lenders can help fill the gap between the cash that business owners have on hand and the amount of money they need to start new cannabis businesses. Anyone interested in beginning a cannabis business should explore their options, find the best possible loans, and use the money to pay for locations, equipment, and inventory that will contribute to success.

March 27, 2021Comments Off
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