Extra Extra! New York Begins Issuing First Adult Use Retail Licenses

As a New York-based cannabis financing firm, Canna Business Resources is a definitive resource for cannabis operators in the United States, having provided more than $100 million in financing in 2021 for operators in nearly every state and every vertical and on pace to eclipse that amount this year. As we approach the Benzinga Capital Conference, we are acutely aware of the new, recreational cannabis opportunities presented in the New York market.

People who have been directly impacted by the drug war in New York are now able to submit applications for the first round of retailer licenses in the state. These licenses are called “Conditional Adult Use Retail Dispensary (CAURD) licenses.  

New York regulators have been promoting the launch of the application portal for weeks, emphasizing that this represents a key step toward ensuring industry equity as the state prepares to open its adult-use market by the year’s end.

Up to 150 licenses will be awarded across 14 regions of the state, with most concentrated in New York City boroughs like Manhattan, Brooklyn and Long Island. Queens will have 16 licenses and Mid-Hudson will have 17.

People who receive CAURD licenses will be able to access a $200 million Social Equity Cannabis Fund. In order to qualify for the special retail license, applicants must have faced a conviction for a cannabis-related offense prior to the enactment of legalization in the state, or have a direct relative with such a conviction, and they must also have experience operating a qualifying business. To further ensure that those most impacted by criminalization are able to compete as the market opens and matures, the conditional licenses would need to be reserved to applicants with at least 51% ownership by justice involved people as outlined in the measure.

Additionally, from a product supply perspective, the first 15 adult-use conditional processor licenses have already been approved in the state. For New Yorkers, this means that processors can now create branded products from the 242 cultivator licensees and distribute those products through the approved network of retailers.

The challenge, of course, is getting that product to market. Finding a suitable location, going through the application process, arranging appropriate financing, and opening and then procuring the necessary inventory are all critical components of the early success of retail operations, and for now, the ability to execute that plan on a wide scale remains unproven in New York’s vast market. 

New York Retail Conditional Adult Use Retail License Summary

New York Set to be Top of Cannabis Food Chain

Not surprisingly, a relatively wealthy state such as New York is expected to be a cannabis consumer behemoth. According to a market study on behalf of the New York Medical Cannabis Industry Association, it is estimated the New York cannabis market could reach $1.2 billion in 2023 and grow to more than $4 billion by 2027. Additionally, some estimates put the figures much higher, at $7 billion in the coming few years. Those estimates are preliminary and based on these figures, New York would be one of the largest individual cannabis markets in the world.  

Source: MPG Consulting.

What does that mean? To commercialize a product in a rapidly growing, limited license market with such growth dynamics will be costly. While the Social Equity Cannabis Fund has allotted $200 million for these enterprises, it is still unclear how that will be allocated, how long it will take to apply for, underwrite, and receive funding, and how much will be available per project.  

Canna Business Resources Brings New York Expertise

“Being a New York-based investment firm and lender to the cannabis industry, the leadership team at CBR has been tracking the New York market for years, says Michael Tew from Canna Business Resources. We are incredibly excited to see this industry come alive in such a fantastic and equitable manner and are looking forward to be a part of the larger New York cannabis community.”  

In addition to the capital available to justice-challenged licensees, CBR is proud to offer premier financing terms to its colleagues in New York as they look to either expand existing operations or launch new businesses.  

CBR offers robust sourcing, underwriting, and structuring team to service the capital formation needs of both large and small cannabis operators anywhere in the value spectrum. It employs a unique underwriting process that both defines and devises custom, non-dilutive lending solutions to help cannabis companies grow. With its vast experience, CBR can provide a term sheet for financing within 24 hours of an initial introduction to its underwriting team.

Tew says, “We know the markets, we know the operators, and we know the industry dynamics. Our solutions have become a definitive capital resource for hundreds, perhaps thousands of cannabis companies since we launched in 2018.”  

Easily Approachable

The entire team of professionals are looking forward to meeting a host of new people at the Benzinga Capital Conference. New York, Massachusetts, Pennsylvania, Illinois, Missouri – any market.

For more information about CBR’s financing options, contact Michael Marini at info@cbrfunds.com or 347-826-3504

Get tickets to Benzinga’s Cannabis Capital Conference today!

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