The Nevada Cannabis Control Board (CCB) on June 28th approved regulations for cannabis consumption lounges which could allow businesses to allow on-site use by the end of the year. The board indicated that it plans to award the first licenses for on-site consumption in the fall.
Nevada Launches Cannabis Lounge Regulations
Within Nevada cannabis lounges, use will be limited to 3.5 grams of “usable cannabis”, and patrons may not take unused cannabis products with them when they leave the lounge. Rooms designated for smoking must be inside designated areas and outdoor lounges are also an option.
Social use provisions were approved in Nevada in 2019 and the CCB sent letters to retail license holders in 2021 indicating that retail cannabis license holders were eligible to apply for a consumption operation.
Canna Business Resources Provides Financing for Cannabis Lounge Expansion
In response to this long anticipated ruling in Nevada, Canna Business Resources had been working with a client to acquire a suitable property with which the operator could vertically integrate its existing cultivation operation into a retail store with attached lounge.
The property, on the outskirts of Las Vegas, had been under negotiations with Canna Business Resources’ client for the past three months. Thanks to CBR’s flexibility and unique structuring, the operator was able to facilitate a real estate acquisition and working capital to build out both a retail facility and cannabis lounge.
The site, a modest facility on the outskirts of Las Vegas proper, intends to be home to this cultivator’s first retail outpost and just a stone’s throw away from the Las Vegas Strip. The retail and lounge experience, which is new in the cannabis community in the United States, is part of the operator’s long term growth plan. Although cannabis lounges today are relatively limited in size and scope, with regulatory restrictions focused on “testing the waters,” Canna Business Resources’ client intends to use this new facility as a jumping off point to open several in the state of Nevada and in additional markets that continue to welcome cannabis lounges in the future.
Canna Business Resources Structures Real Estate and Working Capital Loan
To help our client in Nevada, Canna Business Resources provided $3.5 million in loans, consisting of a $2.5 billion in real estate acquisition and $1.0 million for working capital needs. The working capital needed for the facility included tenant improvements, furniture and fixtures, personnel, and inventory. The loan was structured at a 75% Loan to Value ratio with a three year-term and interest only component. The cannabis real estate loan has a three year balloon.
The interest only real estate loan is specifically for entrepreneurs acquiring and developing real estate properties for cannabis licenses that take time to acquire, develop and generate profitability.
CBR has a proven reputation as a long-term capital partner. CBR’s cannabis real estate loans are structured to maximize success and development longevity.
Contact Canna Business Resources for a quick initial indication of financing availability to see how CBR can provide an interest only term loan for your cannabis operation.