LANSING – It’s not just mom and pop weed dealers anymore.
Lansing’s medical marijuana market is taking shape as a multi-million dollar industry.
Twenty dispensary owners have promised to pour $82.3 million into capital improvements at licensed medical marijuana facilities in Lansing. That figure, according to Lansing officials, includes money owners who have earmarked for related business in the city, including grow and processing facilities that make use of items like the Rosin Press and others.
Employees at Green Peak Innovations in Windsor Township, near Lansing, pull marijuana plants to be dried. Green Peak specializes in marijuana growing, testing, and processing for various products sold at commercial businesses. Buy Photo
Employees at Green Peak Innovations in Windsor Township, near Lansing, pull marijuana plants to be dried. Green Peak specializes in marijuana growing, testing, and processing for various products sold at commercial businesses. (Photo: State Journal file photo)
Collectively, these businesses are expected to hire 2,264 full-time equivalent employees, most of whom will be making at least $15 an hour, Lansing City Clerk Swope said.
Swope declined to release specific business plans, citing a provision in the state’s medical marijuana law that shields license applications from disclosure under the Freedom of Information Act.
Industry rep: Liberal approach encouraging
Kelli Hykes, director of government relations for Weedmaps, believes Lansing is in a position of strength because entrepreneurs are more comfortable investing in communities with a liberal approach to marijuana.
Weedmaps is an online platform that provides product reviews and a directory of marijuana businesses. It’s like Yelp for weed.
“The nice thing about the cannabis industry is that there is really a place and opportunity for everybody,” Hykes said.
Michigan has seen more than $116 million in medical marijuana sales since November 2018, when regulators began tracking dispensary revenue, according to a state Department of Licensing and Regulatory Affairs spokesman.
Voters first legalized medical marijuana in 2008, but local officials can limit or ban medical marijuana businesses within their communities.
Old 27 Wellness on North East Street appears in a Lansing State Journal file photo. The medical marijuana dispensary is fully licensed and was open for business on Thursday, June 26, 2019. Buy Photo
Old 27 Wellness on North East Street appears in a Lansing State Journal file photo. The medical marijuana dispensary is fully licensed and was open for business on Thursday, June 26, 2019. (Photo: Matthew Dae Smith/Lansing State Journal)
In 2017, Lansing became the first community in the tri-county area to adopt rules allowing medical marijuana dispensaries.
Before city officials began enforcing those rules, as many as 70 dispensaries operated in Lansing without licenses.
Those Wild West days that challenged local and state laws may be over.
Despite a series of lawsuits over rules for state licensing, Michigan’s marijuana market appears to have some regulatory clarity.
In Lansing, Swope, the city clerk, announced this month that 20 dispensaries have received full or conditional approval to sell medical marijuana.
Participants take celebratory smoke April 4, 2015, during the annual Hash Bash at the University of Michigan in Ann Arbor. Michigan’s liberal stance on marijuana has attracted out-of-state investors, industry experts say.
Participants take celebratory smoke April 4, 2015, during the annual Hash Bash at the University of Michigan in Ann Arbor. Michigan’s liberal stance on marijuana has attracted out-of-state investors, industry experts say. (Photo: Associated Press file photo)
At least six of those dispensaries also have state licenses. Both state and local licenses will be required to operate a marijuana business legally in Lansing.
The city clerk could approve to up to five more dispensaries during a second and final licensing round, bringing the total number of pot shops in Lansing to 25.
Fifty-seven dispensaries had applied for the five available licenses by the end of the day Thursday when the city’s application period closed. Some applicants may end up disqualified due to incomplete applications, Brian Jackson, Lansing’s deputy clerk said Thursday evening.
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Green Peak Innovations, headquartered in Eaton County’s Windsor Township, southwest of Lansing, is one of the largest marijuana companies in the state.
It anchors a 130-acre marijuana business park called Harvest Park that’s under construction near the Michigan State Police headquarters.
Green Peak specializes in marijuana growing, processing and product development for its own brand of dispensaries. It’s also a wholesale supplier to other businesses.
Windsor Township prohibits dispensaries within township limits but allows other types of marijuana businesses, including grow facilities.
Green Peak has a second location in south Lansing that’s a research and development facility.
The company employs at least 200 people and expects to add another 100 jobs at its Windsor Township and Lansing facilities by the end of the year.
Read more: Minorities find themselves almost shut out of Michigan’s marijuana business
Read more: Marijuana jobs in Michigan: Weedmaps offers tips on how to get them
“We’re building an interesting culture of people who are very proud to be involved with the most premium brand of medical cannabis in the state,” said Colleen Robar, a company spokeswoman.
Green Peak has state licenses and local approval to open 19 dispensaries throughout the state over the next two years, employing as many as 400 people.
It’s also pushed to move money and products to other states.
Companies are popping up throughout Michigan that not only grow marijuana, but also make edibles infused with the plant’s oil. Cereal bars and candies are popular forms of marijuana edibles.Buy Photo
Companies are popping up throughout Michigan that not only grow marijuana, but also make edibles infused with the plant’s oil. Cereal bars and candies are popular forms of marijuana edibles. (Photo: State Journal file photo)
Green Peak agreed this month to purchase for $48 million a growing license that was previously held by Tree King Tree Farms, a Florida-based cannabis company.
The purchase gives Green Peak one of only 22 licenses in Florida for growing, processing or dispensing.
Within the city of Lansing, Green Peak has licenses for a grow facility at 1669 E. Jolly Road and also has conditional local approval for at least two dispensaries – one at 700 N. Pennsylvania Ave. and another at 2508 S. Cedar St.
Employee compensation, benefits
Employee compensation at Green Peak ranges from about $14 to $22 an hour, depending on the position, and most positions include benefits.
As of Wednesday afternoon, Green Peak’s website listed more than 40 positions available in Lansing, Ann Arbor, Bay City, Newaygo and Nunica. Newaygo is about 40 miles north of Grand Rapids, and Nunica is about 20 miles southeast of Muskegon.
Several medical marijuana dispensaries in Lansing have opened the past few years. But several like Greenwave, 500 E Oakland Ave., have closed because they couldn’t get licensed by the city.Buy Photo
Several medical marijuana dispensaries in Lansing have opened the past few years. But several like Greenwave, 500 E Oakland Ave., have closed because they couldn’t get licensed by the city. (Photo: State Journal file photo)
Hykes said employees of marijuana businesses get paid a “living wage” and receive health insurance from their employers.
She said some marijuana workers have joined labor unions. In Michigan, it’s unclear if organizing efforts have targeted the emerging marijuana industry.
Brian Rothenberg, a United Automobile Workers spokesman, said in a text message Wednesday he’s unaware of any efforts by the UAW or other unions to get recruit members of the state’s marijuana workforce.
Michigan officials with the United Food and Commercial Workers International Union, billed this month in a Rolling Stone Magazine story as “America’s most powerful cannabis union,” did not respond to a request for comment.
Recreational sales on the horizon
Stephen Joseph, an owner of Lansing’s now closed Amsterdam marijuana dispensary, had some success in 2017 serving customers. City and state officials have made several changes to the licensing structure for these types of businesses since then. Buy Photo
Stephen Joseph, the owner of Lansing’s now closed Amsterdam marijuana dispensary, had some success in 2017 serving customers. City and state officials have made several changes to the licensing structure for these types of businesses since then. (Photo: State Journal file photo)
The field of companies and investors eager to dive into Michigan’s recreational marijuana industry could get crowded over the next few years.
Michigan voters legalized recreational marijuana use in 2018, but licensed recreational marijuana businesses may not open in the state until 2020.
These businesses would give anyone at least 21 years old the opportunity to buy a range of products currently sold at licensed dispensaries only to holders of state-issued medical marijuana cards.
Owners of licensed medical marijuana dispensaries are expected to get the first opportunity to apply for licenses to sell recreational weed.
As is the case with medical marijuana, local officials may ban or limit the proliferation of recreational marijuana businesses.
So far, however, Lansing appears poised to embrace recreational retail.
There are a multitude of marijuana strains and edibles offered at medicinal marijuana dispensaries throughout Michigan.Buy Photo
There are a multitude of marijuana strains and edibles offered at medicinal marijuana dispensaries throughout Michigan. (Photo: State Journal file photo)
It would take a majority vote from at least five of eight Lansing City Council members to block recreational business from opening in the city. And Lansing Mayor Andy Schor has promised to veto any ban. It would take six council members to override his veto.
Schor has suggested that Lansing could limit recreational sales to the 25 locations covered by the city’s medical marijuana licenses.
Hykes, of Weedmaps, believes local officials are committed to taking the industry seriously.
“You see a real understanding that there’s a medical purpose (for marijuana) but also a place for adult (recreational) use,” Hykes said.
A bullish analysis for growth
During the first year of legal pot shops, recreational marijuana sales in Michigan could range from $492 million to $640 million statewide, according to an analysis from the Anderson Economic Group, a public policy consulting firm.
The firm predicts that it could take three to five year’s for the state’s recreational market to reach maturity, at which point sales could range from $767 million to $1.4 billion annually, the report concluded.
Recreational sales are bound to shrink demand for medical marijuana in Michigan, the report predicted.
Green Peak Innovations is a facility in Windsor Township that grows several different strains of marijuana. It plans to open a chain of Skymint brand dispensaries in Michigan. Buy Photo
Green Peak Innovations is a facility in Windsor Township that grows several different strains of marijuana. It plans to open a chain of Skymint brand dispensaries in Michigan. (Photo: State Journal file photo)
Legal weed may also have a “modest” effect on the liquor industry by decreasing demand for alcohol, researchers wrote.
The national market for both medical and recreational marijuana is projected to hit $22.3 billion by 2023, according to a 2019 report from the Brightfield Group, a Chicago-based research firm that specializes in the legal cannabis industry.
Most of the national industry’s growth over the next four years will result from the recreational sector, the report concluded, especially in Eastern and Midwestern states, including Michigan.
“While the West Coast were the pioneers in cannabis legalization, they also experienced their pitfalls,” Brightfield researchers wrote. “Loose restrictions on licenses led to a massive flood of businesses, rapidly over saturating the market and creating confusion for lawmakers and customers alike.
“The East Coast and Midwest, however, we’re watching this all play out and as a result, took a different approach.”
The emerging marijuana market is more regulated, researchers observed, and that market is more likely to favor bigger players who can afford to invest big bucks.
Credit: www.lansingstatejournal.com