Terra Tech, a national cannabis company with local roots, will finally get to run a store in its own backyard.
The Irvine-based firm on Thursday announced a $7 million deal to buy The Reserve dispensary in Santa Ana, which has been co-owned by rapper The Game.
Terra Tech plans to rebrand the shop as Blüm, the name for its growing chain of dispensaries. The company already has one Blüm dispensary in Oakland, four in Nevada and another coming soon to San Leandro. Terra Tech also owns cultivation and extraction facilities.
But the deal in Santa Ana marks the publicly traded company’s first retail space in Southern California.
“We’re excited to have something close to our corporate headquarters,” said Derek Peterson, CEO of Terra Tech. “We see this as being one of the flagship locations for us.”
The deal has been a long time coming.
Through a 2014 ballot measure, Santa Ana became the first and only city in Orange County to allow medical marijuana dispensaries. The city then held a lottery to see who would get a chance to secure one of 20 available permits.
As much as they wanted to open a store in Orange County, Peterson said his company opted against entering the lottery, preferring to pursue opportunities based on merit rather than luck.
They saw the Los Angeles scene as just too risky, with the city still scrambling to license and regulate its shops. So Peterson said they continued expanding the Blüm footprint in other parts of the country, while always keeping an eye on opportunities close to home.
Darice Smolenski, original owner of The Reserve, made the gamble in Santa Ana — and it paid off.
Trees that’s only available at The Reserve.
While Terra Tech is buying out The Game’s ownership stake as part of the deal, Peterson said they plan to continue as the exclusive carrier of his Trees line.
“The guy’s got a great heart,” Peterson said, pointing to how The Game has contributed to causes like Michigan’s Flint water crisis. “We want to continue a partnership with him.”
Terra Tech also hopes to buy the vacant space next-door and turn it into a corporate training campus, Peterson said. It’s a similar model to what’s used in the restaurant industry. They can set up a mock business, giving budtenders and trimmers and other employees a chance to learn Blüm protocols and adjust to company culture before they head out to work in any of the company’s locations.
“We want to bring some measure of consistency to the retail experience,” he said.
The Santa Ana City Council has discussed allowing businesses to grow their own cannabis and offer delivery services. If either of those options move forward, Peterson said Terra Tech would gladly jump on board.
There shouldn’t be any interruption in service for The Reserve’s regular 300 to 400 patients, Peterson said, since their crews will remodel and rebrand the shop at night. He said those customers will also see some new advantages, including a customer rewards program that’s good at any of Blüm’s locations.
Terra Tech plans to hire some new employees, plus keep on any current workers who want to stay. They’ll need to get on board with company protocols, Peterson said. In exchange, they’ll get full benefits, a fixed salary structure and opportunities to advance throughout the growing chain.
“Our model is to promote from within,” he said.
Terra Tech bought The Reserve with $4 million in cash and $3 million in stock, according to documents filed with the Securities and Exchange Commission.
The company, listed on the over-the-counter market as TRTC, saw a 4 percent bump in stock price on news of the sale Thursday morning, with shares trading at $0.23 as of 10 a.m.
Blüm will be the second branded dispensary chain to come to Santa Ana. In June, MedMen opened a sleek store a mile north on South Wright Street, becoming the 16th licensed shop in Santa Ana.
credit:thecannifornian.com
