Flower One Secures $39M Through Term Debt Loan With Subversive REIT

Flower One Holdings Inc. FONE FLOOF secured $39 million in debt financing.

The company worked out an agreement with Subversive Real Estate Acquisition REIT LP, including a two-year option to pursue a sale-leaseback transaction to buy a Flower One facility spanning 455,000 square-feet in Las Vegas.

The REIT agreed to pay up to $80 million for the property and to lease it back to Toronto-based Flower One.

The sale-leaseback option has a term of twenty years, with two 10-year extension options.

In addition, Flower One is obliged to issue warrants equal to 10% of the transaction price once the sale-leaseback is completed.

The loan deal is for a seven-year interest-only loan, carrying a rate of 10.5% per the whole term.

The company said Wednesday it would utilize the proceeds to substitute an existing US$30 million term loan and to fund its other debt commitments as well as general corporate purposes.

Richard Acosta, the CEO and Director of the General Partner of Subversive REIT, disclosed that “entering into a loan agreement and potential sale-leaseback with Flower One” allows them to fulfill their mission of providing “real estate capital solutions to leading U.S. cannabis operators.”

Flower One’s President and CEO is thrilled to “build a strategic partnership with such a deeply connected and highly-knowledgeable cannabis real estate partner.”

Meantime, Flower One recently welcomed Salpy Boyajian, the co-founder of NLV Organics, and the chief operating officer of its Nevada operations, to the Board of Directors.

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