Phoenix Business Journal: “High and dry: Real estate issues present major hurdle for Valley cannabis companies”

Nearly 10 years after Arizona voters legalized marijuana for medical use, dispensary owners and attorneys who work with the industry cite an unlikely hindrance in opening up shop: real estate.

“Real estate is hands down the most cumbersome and challenging part of the entire industry,” said Sara Gullickson, CEO of Item 9 Labs, a publicly traded cannabis company dealing with marijuana cultivation, production, dispensaries and transportation. “Real estate is the number one ingredient.”

Gullickson has eight dispensary licenses and founded Dispensary Permits, a consulting company for weed-oriented businesses going through the licensing and opening process. She sold the consulting business to Item 9 Labs in December when she took over as CEO.

Since Arizona voters approved medical marijuana in 2010, 130 dispensaries have been licensed. But not all have opened. Some in the industry say the delay is in part due to real estate concerns and finding viable sites that are far enough away from schools, city facilities and other locations deemed incompatible with medical marijuana.

For some businesses, the fight to land a dispensary location has taken years, and it can cost tens of thousands of dollars to get through the process. If they do find a site, they have to be ready to pay through the nose for rent.