Welcome to California’s Green Rush; The Race for Cannabis Real Estate.
Looking for commercial real estate doesn’t sound like it should be too much of a challenge, right? There should be plenty of spaces and warehouses available in Southern California. Actually, not quite.
If you’re interested in setting up a cannabis business in places like Los Angeles or Orange County, get ready for a lengthy fight and some healthy competition. The demand for commercial and industrial real estate in California far outweighs the supply.
Industrial vacancy rates in Orange County are at historic lows. According to a research and forecast report by Colliers International, the vacancy rate in Orange County for the second quarter of 2019 is at 3.9% and is expected to remain this way due to a growing demand and limited inventory. Sitting at even lower rates is Central Los Angeles at 1.8% for Q2.
Low vacancy rates and high industrial property demands combined with added regulations for “Green Zones” and high prices makes the cannabis real estate market in California an extremely competitive one that requires a creative approach.
Green zones are areas that allow legal cannabis activity. On top of the fact that Southern California is tight on available industrial properties, green properties are even harder to find due to local restrictions.
The Adult-Use of Marijuana Act opened the doors for legalized cannabis sales in California in 2018 and although the consumption of marijuana and marijuana products is legal in the state, the 58 municipalities have jurisdiction over where cannabis activity is permitted and according to a report from Arcview, 80% of these municipalities have banned commercial cannabis activity in their jurisdiction making the available options a lot slimmer.
This creates huge obstacles for the growth of the cannabis industry by severely restricting areas where green businesses can operate.
Finding Cannabis Real Estate in California
Even with these challenges presenting themselves, the cannabis industry is one of the fastest-growing ones in the world.
Finding a “For Rent” sign is just the beginning of the race. Cannabis business entrepreneurs looking for commercial or industrial properties are basically racing to secure a spot to set up shop and get their commercial licenses.
In a tremendously competitive market where demand outweighs supply, a creative real estate strategy goes a long way. We’ve made the process a lot easier for our clients by creating a database of green properties available and constantly researching the market.
Our real estate specialists have extensive experience in commercial real estate acquisition as well as a keen knowledge of cannabis law. Visit our listings page here to see available properties and schedule a consultation with us to get your cannabis business on the path to success.