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?

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.

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.

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.

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

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).

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?

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.

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).

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.

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!

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.

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.