New Jersey Cultivation Cap Expired, But Real Estate Issues Remain

Although the limit on cannabis cultivation licenses was lifted in New Jersey last month, real estate challenges continue to hinder the industry’s growth.

New Jersey’s cannabis legalization law initially went into effect in 2021 with a cultivator cap set at 37 licenses. Adult-use sales launched in April 2022, but at the time only seven cultivators were licensed to supply cannabis 13 dispensaries across the state. Last month, the Cannabis Regulatory Commission (CRC) allowed the cap to expire on Feb. 22.

“The market is developing, and we don’t want to hinder that. The New Jersey canopy is currently only 418,000 square feet—far below the average of other states with legal cannabis,” said Commissioner Maria Del Cid-Kosso. “New Jersey currently has only one cultivation license for every 197,000 residents. The national average is one license for every 31,000 residents. We have a lot of room to grow. We expect that lifting the cap will open the space for more cultivators, ultimately resulting in more favorable pricing and better access for patients and other consumers.”

As of March 2, the CRC has granted licenses to 17 operational cultivation facilities. But even with the cultivation license cap change, many New Jersey municipalities have opted out of adult-use cannabis. One year ago, the Ashbury Park Press reported that nearly 400 towns had opted out of being home to any cannabis businesses. The co-founder and president of New Jersey-based Premium Genetics, Darrin Chandler Jr., told MJBizDaily that finding potential real estate opportunities is “almost impossible,” and described prices as “astronomical.”

On the patient side, New Jersey is still the only state with a medical cannabis program that does not allow patients to grow at home. In the past, many bills have been introduced to permit home cultivation to allow medical cannabis patients to grow for personal use. Bill S342, which is sponsored by Sen. Troy Singleton and Sen. Vin Gopal, would allow patients to cultivate at home. However, a report from Politico states that opposition from Senate President Nick Scutari is a significant roadblock for the bill.

New Jersey’s industry is continuing to attract outside cannabis businesses. Brands such as Al Harrington’s Viola products are expanding into the state this month, starting on March 24 at RISE dispensaries. According to Harrington, he wants to expand his brand to support the local community. “I want to make sure that we are educating our community and empowering them with knowledge to understand the cannabis plant and the benefits that come from it,” Harrington told Business Insider.

Similarly, Raekwon of Wu-Tang Clan is preparing to open Hashtoria Cannabis Lounge in Newark, New Jersey as well. “Getting excited yall!!! @hashstoria coming to the brick city !!!!! This is going to be flyest consumption lounge to hit the east coast. This will be monumental ! All hail to the mighty green ! Be strong, be wise and be the best version of you!!! #newjersey #cannabis #hashstoria” Raekwon recently wrote on Instagram.

Recently, the CRC held a public comment period to discuss its draft rules for cannabis consumption rules, which ends on March 18. This includes restrictions for on-site food sales, but permits food to be delivered or brought in from outside, and prohibition of tobacco and alcohol sales on-site.

In late February, the New Jersey Attorney General released an updated drug testing policy for law enforcement. Under the new revision, law enforcement officers will only be drug tested if they appear intoxicated at work. “Agencies must undertake drug testing when there is reasonable suspicion to believe a law enforcement officer is engaged in the illegal use of a controlled dangerous substance, or is under the influence of a controlled dangerous substance, including unregulated marijuana, or cannabis during work hours.”

Source: https://hightimes.com/news/new-jersey-cultivation-cap-expired-but-real-estate-issues-remain/