Investing in MJ
Click here for Top Ten Discussions. CLICK HERE for Q & A Homepage
Receive Free Rental Owner Updates Email:  
MrLandlord Q & A
     
     
Investing in MJ (by Ray-N-Pa [PA]) Oct 7, 2021 2:29 PM
       Investing in MJ (by Ray-N-Pa [PA]) Oct 7, 2021 2:32 PM
       Investing in MJ (by myob [GA]) Oct 7, 2021 2:44 PM
       Investing in MJ (by S i d [MO]) Oct 7, 2021 3:08 PM
       Investing in MJ (by Allym [NJ]) Oct 7, 2021 3:21 PM
       Investing in MJ (by Vee [OH]) Oct 7, 2021 3:38 PM
       Investing in MJ (by Richard [MI]) Oct 7, 2021 3:43 PM
       Investing in MJ (by Frank [NJ]) Oct 7, 2021 4:12 PM
       Investing in MJ (by plenty [MO]) Oct 7, 2021 4:36 PM
       Investing in MJ (by 6x6 [TN]) Oct 7, 2021 5:14 PM
       Investing in MJ (by Allym [NJ]) Oct 7, 2021 6:11 PM
       Investing in MJ (by 6x6 [TN]) Oct 7, 2021 6:58 PM
       Investing in MJ (by Deanna [TX]) Oct 7, 2021 7:01 PM
       Investing in MJ (by Landlord ofthe Flies [TX]) Oct 7, 2021 7:32 PM
       Investing in MJ (by Mike45 [NV]) Oct 7, 2021 9:10 PM
       Investing in MJ (by small potatoes [NY]) Oct 7, 2021 10:01 PM
       Investing in MJ (by BRAD 20,000 [IN]) Oct 7, 2021 11:24 PM
       Investing in MJ (by Scott [IN]) Oct 8, 2021 9:35 AM
       Investing in MJ (by Oregon Woodsmoke [ID]) Oct 8, 2021 10:55 AM
       Investing in MJ (by Oregon Woodsmoke [ID]) Oct 8, 2021 10:57 AM
       Investing in MJ (by Lana [IN]) Oct 8, 2021 3:25 PM
       Investing in MJ (by Ray-N-Pa [PA]) Oct 10, 2021 6:37 PM

Click here to reply to this discussion.
Click Here to send this discussion to a friend

Investing in MJ (by Ray-N-Pa [PA]) Posted on: Oct 7, 2021 2:29 PM
Message:

I was searching for some NNN investments closer to me. Sure enough, I saw a place available that is set up NNN that was in my price range about an hour away from me.

The commercial tenant was not a household name that I recognized. Upon looking into this opportunity closer, I noticed that this is a medical marijuana dispensary. Interesting, I thought. You see in Pa 1 in 11 have a card, so it is rather clear that the system is being scammed.

With this being said I my banker if could get a loan to buy the place. Banker said - nope they are still selling a class two narcotic. I said yes, but they are doing it legally. They said, yes according to Pa but not according the feds.

So I have to ask, how many of you scratch off this place strictly based on what they sell?

--24.101.xxx.xxx




Investing in MJ (by Ray-N-Pa [PA]) Posted on: Oct 7, 2021 2:32 PM
Message:

I have a second follow up question.

Since this appears to be a none bankable NNN purchase, how do you buy this place? Having the seller carry paper on the place doesn't make sense since this is NNN. Since this is mailbox money, there is no reason to carry anything.

I suppose I could partner up with someone else - but I am too keen on partnerships --24.101.xxx.xxx




Investing in MJ (by myob [GA]) Posted on: Oct 7, 2021 2:44 PM
Message:

no one has shelf loans by you? Fact is even if they did-- lenders say we have to file Fannie and freedy guidlines so its a no there also.

I've found, over my experiences which is limited -- spending time to MAKE things work-- never works.

YOU are the only one working and still after weeks and weeks still no close. Move on.

How was their product though? --99.103.xxx.xxx




Investing in MJ (by S i d [MO]) Posted on: Oct 7, 2021 3:08 PM
Message:

I own several properties that are zoned to allow cannabis distribution, oil extractions, etc. That's not he EXCLUSIVE use, but it is a permitted use.

MJ is part of the new normal. Not much different from tobacco, though somewhat more "zonking" from what I understand. I haven't messed with the stuff so cannot confirm. My drugs of choice remain beer & whiskey.

--108.230.xxx.xx




Investing in MJ (by Allym [NJ]) Posted on: Oct 7, 2021 3:21 PM
Message:

Saw something on Twitter. When people get too much of the THC chemical in their body, and it does stay in body fat, the have a shrieking vomiting session. I bet that only happens once. There is a reason that stuff is illegal although the left likes chaos. --108.24.xx.xx




Investing in MJ (by Vee [OH]) Posted on: Oct 7, 2021 3:38 PM
Message:

Is it brownies, gummy bears or the type you must lite?

There is the difference, either product they will be breaking thru everything including the floor to steal the stuff. --76.188.xxx.xxx




Investing in MJ (by Richard [MI]) Posted on: Oct 7, 2021 3:43 PM
Message:

No matter if we like it or approve of it or not, it seems it is here to stay. The govt may or may not fully approve. Banks may not approve, but eventually I think they will.

That does not solve the current problem though.

Me, I'd look at the building carefully and see if there are other potential uses for it (other good tenants that might want to do business there). If the probability was good, I'd use the non govt and non bank approved argument to get a better price and terms. Then if the current tenant did not stay, for whatever reason, I'd have another tenant soon (at least hopefully soon).

Right now, with all that's going on, I'd be extra careful as there are a lot of companies going out of business and a lot of vacant stores. Except, of course, I've never heard of an MJ store failing. Usually they have a line out the door with people getting their "medicine" , likely with taxpayer money. --172.58.xx.xx




Investing in MJ (by Frank [NJ]) Posted on: Oct 7, 2021 4:12 PM
Message:

Here at the heart of yhe North Jersey Shore for the psst few months there is a double booth at a local flea market that id doing a land office bizness with MJ. Even though such a low end type business is nkt supposed to be legsl, somehow it is going on. --174.206.xxx.xxx




Investing in MJ (by plenty [MO]) Posted on: Oct 7, 2021 4:36 PM
Message:

Ray you find out the most interesting things about real estate investing. Carry on. --172.58.xxx.xxx




Investing in MJ (by 6x6 [TN]) Posted on: Oct 7, 2021 5:14 PM
Message:

I was going to ask, I thought Michael Jackson was pushing up daisies?

Just curious, how much is the place?

What happens if you get a loan on some of your paid for properties and just buy this one with cash?

Does the MJ seep into the structure to where you wouldn't be able to rent to someone else in the future?

--73.120.xx.xxx




Investing in MJ (by Allym [NJ]) Posted on: Oct 7, 2021 6:11 PM
Message:

6x, there is an oil involved Tetrahydracannabinol. Probably TSP would remove it just like grease. --108.24.xx.xx




Investing in MJ (by 6x6 [TN]) Posted on: Oct 7, 2021 6:58 PM
Message:

Thank you Ally --73.120.xx.xxx




Investing in MJ (by Deanna [TX]) Posted on: Oct 7, 2021 7:01 PM
Message:

Some people are gung-ho about investing in vice on purpose. It's very profitable.

Other people avoid investing in vice because that's not what they want to encourage in their communities, no matter how legal it may be.

--137.118.xx.xxx




Investing in MJ (by Landlord ofthe Flies [TX]) Posted on: Oct 7, 2021 7:32 PM
Message:

Deanna's right. Vices that are addictive are usually profitable. --108.69.xxx.xxx




Investing in MJ (by Mike45 [NV]) Posted on: Oct 7, 2021 9:10 PM
Message:

Even "medical MJ" is still illegal under federal law. That is why I did NOT get involved in it. However, both medical and recreational MJ are here to stay. While I still won't get involved in the cultivation, processing or distribution, I would be willing to rent to someone who is.

If the numbers work out, I'd see about a cash purchase, using as leverage the fact that the banks and other lenders will not touch financing this place and the Seller needs someone willing to put up cash (or the Seller can take back paper).

I do not know what your local banks do, but the sellers of MJ often have trouble with their banking, and you have to anticipate getting paid in cash. Some banks really don't like cash deposits. Consider if this will be a problem for you. --76.4.xxx.xxx




Investing in MJ (by small potatoes [NY]) Posted on: Oct 7, 2021 10:01 PM
Message:

A medical dispensary, sure. A retail one no. I am opposed to edibles and the exposure to children. Not that it would concern you in a NNN situation but traffic to the retail location can become a community issue. In a production facility you have to be careful that they are properly using and disposing of the toxic solvents used to extract thc oil.

It is an industry that is yet to boom. The local community college started offering grow courses and has a waiting list.

Also think of legal accessory companies like those that build warehouses, greenhouses, grow lights, hydroponic systems etc.. or purchase raw land and hold it till they come looking for it to farm.

I'd say the dispensary worked hard to get the approval to do business. In NY at first they were only approving one in each region. There is probably a guaranteed length of time permitting them to operate before renewing their authorization. You should find out what that is. --24.194.xxx.xxx




Investing in MJ (by BRAD 20,000 [IN]) Posted on: Oct 7, 2021 11:24 PM
Message:

RayRay,

The documentaries I've watched on the MJ business (check out Marcus Lemonis www.cnbc.com/the-profit-marijuana/) the transactions are all cash because the credit card companies cannot handle MJ funds and the bank cannot accept a cash deposit from them because of federal laws.

So your rent would be paid in cash.

There is also a lot of theft and security because of all the cash.

Maybe they need to learn to deal in gift cards - "give me $100 in Amazon gift cards for this bag of hash. I'll sell the cards on Amazon."

Latest articles I've read say the business is not very profitable due to competition and federal interference.

If the building is good consider a private investor/partner.

If you start sampling the goods I expect to see more puns!

BRAD --73.102.xxx.xxx




Investing in MJ (by Scott [IN]) Posted on: Oct 8, 2021 9:35 AM
Message:

Most of the oil extraction solvents are EXTREMELY flammable. Check with your insurance company before doing this deal. --107.141.xx.xxx




Investing in MJ (by Oregon Woodsmoke [ID]) Posted on: Oct 8, 2021 10:55 AM
Message:

While I disapprove in general of legalize MJ, I'd buy a building that was NNN to a dispensary if the figures worked out.

MJ is here to stay and the DEMs are very likely to legalize it nationwide. Keep those welfare voters doped up and disinterested in what the gov is doing.

The dispensaries are not allowed to bank, so you will have to figure out how they are going to pay the rent. Also, they are providing their own insurance, but I suggest that you also carry liability for yourself. Bad things can happen to stoned people and you don't want them coming back at you about it (the deeper pockets principle) --76.178.xxx.xxx




Investing in MJ (by Oregon Woodsmoke [ID]) Posted on: Oct 8, 2021 10:57 AM
Message:

We all know from experience that tenants will pay for their booze, pixzza, and cigarettes before they pay the rent, so the place they get their MJ is going to get paid before anyone else. --76.178.xxx.xxx




Investing in MJ (by Lana [IN]) Posted on: Oct 8, 2021 3:25 PM
Message:

I think security also might be a problem. In about August to early September, before the next harvest a lot of heads run out and all the dealers run dry. The heads get quite inventive about getting their stuff. There are still areas as well, despite legalizing MJ, where organized crime prefers to dominate the market. --216.23.xxx.xx




Investing in MJ (by Ray-N-Pa [PA]) Posted on: Oct 10, 2021 6:37 PM
Message:

Building is being offered at about $800K to 850K range.

My bank has said it can not lend money on a property if such a business rents the inside. I thought, there are a lot of places that sell CBD oil....this is an actual medical dispensary (at least allegedly) . Would they lend on a 3.5M Rite Aid?

So I have to wonder about this.....

The place is NNN. The taxes are paid by the tenant (typically that means the LL is reimbursed), maintenance is paid by the tenant, and insurance is paid by the tenant with the LL list as additional insured interest. This property is mail box money.......why would you be selling this place - looking for an all cash buyer with a Cap Rate of about 7%.

I am thinking that the business owner owns part interest in the building too. With only three years left, maybe they have outgrown the 3,000 sq/ft building.

As for the format they sell the stuff......I don't know. I don't partake. --24.101.xxx.xxx



Click Here to send this discussion to a friend
Report discussion to Webmaster


Reply:
Subject: RE: Investing in MJ
Your Name:
Your State:

Message:
Investing in MJ
Would you like to be notified via email when somebody replies to this thread?
If so, you must include your valid email address here. Do not add your address more than once per thread/subject. By entering your email address here, you agree to receive notification from Mrlandlord.com every time anyone replies to "this" thread. You will receive response notifications for up to one week following the original post. Your email address will not be visible to readers.
Email Address: