Originally Published : August 1, 2023
Good Morning Clients and Friends,
Happy August! We have 21 legal recreational cannabis stores in New York and they are all rocking! We are hearing big sales numbers are being generated and now the floodgates are about to open, as everyone will be able to apply shortly. We expect a flurry of business activity over the next 60-days. Recreational cannabis in NYC, as you imagined, will be here in the blink of an eye and we are all over it.
Legal Commerce Grows
There are currently 18 legal recreational dispensaries in New York State, plus another three that are operating on a temporary/delivery-only basis as their storefronts undergo construction. And in addition to these 21 legal retailers, the State just approved plans for a “Growers Showcase” initiative, which is essential a farmers market for weed. I anticipate that you’ll begin seeing these activations popping up all over town in the coming months. Legal commerce is growing.
Yes, the rollout is going slower than we would have liked, but progress is progress and let’s take a look at some of the positives. Stores are opening in new territories – specifically notable are the Bronx and Long Island regions each getting their own first stores. The Growers Showcase, although governed by rules stricter than we would have liked to see, is a cool, progressive program. Why shouldn’t cannabis be featured, along with other plants and produce, on a farmers market-style platform?
And still, the illegal cannabis stores are a problem. The City and State appear to be aligned on understanding the severity of the need for better enforcement measures, but I believe that they are both waiting until they have more legal stores to protect before deploying the resources necessary for impactful enforcement. Despite this, however, they are still taking some “test runs” at some lower-hanging fruit – see: Empire Cannabis Club.
No More Public Comments
The second public comment period on the formal cannabis regulations in New York officially closed yesterday. It may not seem like it, but this is a fairly significant milestone! Let’s review the process quickly to understand why; then, we can project a future timeline and prioritize action items based on what we know so far.
Procedurally, once the State “published” their original draft cannabis regulations back in December, they were required to hold open a 60-day public comment period. Once it closed, the State reviewed all of the comments they received and amended the regulations accordingly. This process took a while, and a redraft was finally published in mid-June. A second public commend period – this one for 45 days – immediately ensued. Yesterday was the 45th day, so this period is now closed. As they did last time, the State will now review all comments and prepare to synthesize those that made sense into their third and final version of the regs. I don’t expect the changes to be so significant this time around, and I don’t expect the timeline to be quite as long.
My projected future timeline has been pretty consistent thus far, and it was only reinforced further at the last Cannabis Control Board meeting. We expect the final regs to come out around Labor Day, with specific information about the future application process to follow shortly thereafter. Then we anticipate the application portal for one and all to open, in stages based on application type, throughout the month of October. The anticipation is that each application’s window will be open for a period of 30-60 days, and the State will be reviewing and approving applications on a rolling basis.
The Cannascape Evolution
Our mantra throughout this process has been, “Everything takes longer in Cannabis.” Understanding that has been the key to success in this industry. And for those of you that have kept tabs on NY cannabis for the last several years, and have been waiting for the right time to jump in, the time to move is now.
Those who get in early and scoop up the best locations will have a huge advantage because the OCM will not put another store in your backyard. It’s just like the liquor stores; the first movers get the best neighborhood spots and then they get protection from the State. If you want to make a run at owning a piece of this industry in NY, now is the time to get going.
There’s much for you to do in preparation of the application portal finally opening, and if you’re serious, we really need to begin now. You have to start fundraising, and that always takes longer than you think. Then you need to assemble a team of cannabis professionals to help your application win. And you have to find a space that will work for cannabis, which can be tricky. These are time-intensive tasks so if you haven’t started yet, take this as your sign!
We’ve waited a long time to get to this point, and it’s now finally go time. I’ll be back with more updates as the next couple of months unfold, but for now –
Joey Regs out.