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Before cannabis businesses can begin operations or even apply for licenses, they must secure real estate for the business. Although a crucial beginning step, it is ironically one of the most difficult and time-consuming. While many are setting their sights on California’s huge cannabis market, expected to reach $5 billion by 2019, the state’s crashing real estate market makes that an especially difficult task. With real estate already a major challenge in California, it’s easy to imagine the red tape cannabis operators face when trying to find a compliant location for their operations.
Canna-Hub, a Sacramento-based real estate company dedicated to solely cannabis businesses, has created a model to solve the real estate and tax issues plaguing cannabusinesses – the company’s cannabis business parks have a zero revenue tax. The Mendota business park opening already had operators lining up to secure tenancy in the park.
Canna-Hub CEO and 20 year real estate veteran Tim McGraw personally works with legislatures in the towns where he builds cannabusiness parks to pass laws that are favorable for his tenants. Many cannabis operators are paying up to 25% of their revenue to the local government.
Most commercial landlords refuse to rent space to businesses in the cannabis industry as it is still illegal federally and landlords can face arrest for violating the federal Controlled Substances Act. Caught in this Catch 22, cannabusinesses are left with few options and are often unable to get their companies off the ground.
Eventually, if the company is able to secure a lease and apply for licenses they still have to pay federal cannabis taxes along with varying state and city taxes in order to operate. So, start-ups trying to build up to a positive profit margin and pay the bills are forced to give up to 25% of their revenue to the government.
By joining as a tenant of one of its two business parks, Canna-Hub residents skip jump past the hurdles of finding a lease. The business parks are a community of cannabis companies that, ideally, work together for maximum success. Canna-Hub has secured every operating license, aside from growing, on behalf of its residents. So, tenants can move in and begin operations almost immediately — jumpstarting businesses ahead by months or even years.
Currently, Canna-Hub holds two business parks. One in Mendota, Calif. and the other in Williams, Calif. adding up to 1.6 million square feet of production facilities for its community-centered developments.
Would you be interested in speaking with Canna-Hub CEO Tim McGraw about how he has managed to create this ideal situation for his tenants?
If interested, please contact:
M: (818) 433-8224