Tag: Cannabis

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Business

Columbia Care raises approximately $14 million of non-dilutive capital through second sale leaseback

The Transaction Includes the Company’s New Jersey Cultivation and Manufacturing Facility and Dispensary; Additional Sale Leaseback Financings Expected in 2H 2020

NEW YORK–(BUSINESS WIRE)–Columbia Care Inc. (NEO: CCHW) (CSE: CCHW) (OTCQX: CCHWF) (FSE: 3LP) (“Columbia Care” or the “Company”) announced the close of its sale leaseback transaction with Innovative Industrial Properties (NYSE:IIPR) (“IIP”) valued at approximately $14 million. The transaction includes the Company’s dispensary, cultivation and manufacturing facilities in Vineland, New Jersey, totaling approximately 54,000 square feet.

Upon closing, Columbia Care entered into a long-term, triple-net lease agreement with IIP and will continue to develop, operate, and manage the properties. The Company’s New Jersey dispensary commenced sales operations in June, while its cultivation facility recently completed its first harvest and is expected to sell finished, packaged products into both the wholesale and retail markets. Columbia Care expects to continue expanding its cultivation, manufacturing and packaging capabilities over the next 12 months, in addition to adding two more dispensaries and introducing home delivery throughout the state. New Jersey is a rapidly growing market that is expected to transition from medical-only to adult use in 1Q 2021. There are currently 78,000 registered patients and only 11 operating dispensaries in the state.

“Coupled with our other recent financing announcements, this incremental non-dilutive capital will bolster our already strong balance sheet and enable us to continue to execute against our growth and profitability initiatives across the United States,” said Nicholas Vita, CEO of Columbia Care. “With the adult use cannabis measure likely to be passed by New Jersey voters in November, we remain well-positioned to be one of the market leaders in the Garden State. Columbia Care is thrilled to partner with IIP as we capitalize on the positive tailwinds across our various markets and achieve adjusted EBITDA profitability later this year.”

IIP President and CEO Paul Smithers commented: “We are excited to partner with the team at Columbia Care as we believe the cannabis market in New Jersey is poised for strong growth in the coming years. We look forward to enabling Columbia Care to further its position as a leading operator in the state.”

About Columbia Care Inc.

Columbia Care is one of the largest and most experienced cultivators, manufacturers and providers of medical and adult use cannabis products and related services with licenses in 18 US jurisdictions1 and the EU. Columbia Care has completed more than 1.8 million sales transactions since inception and working in collaboration with renowned and innovative teaching hospitals and medical centers globally, continues to be a patient-centered health and wellness company setting the standard for compassion, professionalism, quality, care and innovation in the rapidly expanding cannabis industry. For more information on Columbia Care, please visit www.col-care.com.

Caution Concerning Forward-Looking Statements

This press release contains certain statements that constitute forward-looking information within the meaning of applicable securities laws and reflect the Company’s current expectations regarding future events. The Company has made assumptions with respect to its New Jersey operations including adult use legalization passage, home delivery, its ability to find suitable additional dispensary locations as well as its ability to negotiate additional lease arrangements satisfactory to the Company; complete all planned construction in a timely manner and attract qualified staff. Columbia Care has also made certain general industry assumptions in the preparation of such forward-looking statements including projections that may be impacted by macroeconomic factors and other factors not controllable by the Company. While Management believes its assumptions and forward-looking statements to be reasonable at the time of preparation, there can be no assurance that actual results will be consistent with such forward-looking statements. Investors are also advised to review other risk factors discussed under “Risk Factors” in Columbia Care’s Annual Information Form dated March 31, 2020, filed with the applicable Canadian securities regulatory authorities on SEDAR at www.sedar.com and described from time to time in documents filed by the Company with Canadian securities regulatory authorities.

1 Includes Colorado, subject to successful completion of the acquisition of The Green Solution and W. Virginia industrial hemp cultivation license.

Contacts

Investor Contact:
Gary F. Santo, Jr.

Investor Relations

+1.212.271.0915

ir@col-care.com

Media Contact:
Gabriella Velez

5WPR

columbiacare@5wpr.com

Categories
Business

Innovative Industrial Properties acquires properties in New Jersey and enters into long-term leases with Columbia Care

SAN DIEGO–(BUSINESS WIRE)–Innovative Industrial Properties, Inc. (IIP), the first and only real estate company on the New York Stock Exchange (NYSE: IIPR) focused on the regulated U.S. cannabis industry, announced today that it closed on sale-leaseback transactions with subsidiaries of Columbia Care Inc. (Columbia Care) for two properties in New Jersey, an industrial building comprising approximately 50,000 square feet and a retail location comprising approximately 4,000 square feet.

The purchase prices for the properties were approximately $12.4 million in total (excluding transaction costs). Concurrent with the closings of the purchases, IIP entered into a long-term, triple-net lease agreement for each property with a subsidiary of Columbia Care, which intends to continue to operate the retail property as a regulated medical-use cannabis dispensary and the industrial property as a regulated medical-use cannabis cultivation and processing facility. Columbia Care is expected to complete additional tenant improvements for the industrial property, for which IIP has agreed to provide reimbursement of up to $1.6 million. Assuming full reimbursement for the tenant improvements, IIP’s total investment in the two properties will be approximately $14.0 million.

Columbia Care (NEO: CCHW) (CSE: CCHW) (OTCQX: CCHWF) (FSE: 3LP) is one of the largest and most experienced cultivators, manufacturers and providers of medical and adult-use cannabis products and related services with licenses in 18 jurisdictions in the United States and the European Union. Columbia Care has completed more than 1.8 million sales transactions since inception and working in collaboration with renowned and innovative teaching hospitals and medical centers globally, continues to be a patient-centered health and wellness company setting the standard for compassion, professionalism, quality, care and innovation in the cannabis industry.

As the pioneering real estate investment trust (REIT) for the medical-use cannabis industry, IIP partners with experienced medical-use cannabis operators and serves as a source of capital by acquiring and leasing back their real estate assets, in addition to offering other creative real estate-based capital solutions.

“Columbia Care is one of the preeminent cannabis operators in the United States, and we are thrilled to introduce them as a new tenant partner,” said Paul Smithers, President and Chief Executive Officer of Innovative Industrial Properties, Inc. “As one of the largest cannabis operators, Columbia Care is dedicated to providing the highest quality products and services to patients and customers, and we look forward to supporting them as a long-term real estate capital partner in New Jersey, including providing the additional real estate capital for further enhancements to their cultivation and processing facility.”

Added Nicholas Vita, CEO of Columbia Care: “Partnering with IIP provides Columbia Care with access to nondilutive capital that offers flexibility and provides us with the ability to continue to build and expand our cultivation, manufacturing, and retail capabilities in the markets that matter most.”

Last month, Columbia Care announced the opening of the dispensary location, as one of only three operators licensed to dispense medical cannabis in the southern region of New Jersey, and produced its first harvest this month at its cultivation and processing facility. Similar to other states, New Jersey authorities classified medical cannabis dispensaries as “essential,” allowing them to remain open during the coronavirus pandemic, while implementing additional safety and social distancing protocols to protect the health of patient customers and employees. Last month, the New Jersey Department of Health also enacted a waiver that allows licensed operators to provide home delivery of medical cannabis products to patients.

As of July 20, 2020, IIP owned 61 properties located in Arizona, California, Colorado, Florida, Illinois, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, Nevada, North Dakota, Ohio, Pennsylvania and Virginia, totaling approximately 4.5 million rentable square feet (including approximately 1.5 million rentable square feet under development/redevelopment), which were 99.2% leased (based on square footage) with a weighted-average remaining lease term of approximately 16.1 years. As of July 20, 2020, IIP had invested approximately $820.4 million in the aggregate (excluding transaction costs) and had committed an additional approximately $213.3 million to reimburse certain tenants and sellers for completion of construction and tenant improvements at IIP’s properties. These statistics do not include up to approximately $7.0 million that may be funded in the future pursuant to IIP’s lease with a tenant at one of IIP’s Illinois properties, or approximately $17.1 million that may be funded in the future pursuant to IIP’s lease with a tenant at one of IIP’s Massachusetts properties, as the tenants at those properties may not elect to have IIP disburse those funds to them and pay IIP the corresponding base rent on those funds. These statistics also treat IIP’s Los Angeles, California property as not leased, due to the tenant being in receivership and its ongoing default in its obligation to pay rent at that location.

About Innovative Industrial Properties

Innovative Industrial Properties, Inc. is a self-advised Maryland corporation focused on the acquisition, ownership and management of specialized industrial properties leased to experienced, state-licensed operators for their regulated medical-use cannabis facilities. Innovative Industrial Properties, Inc. has elected to be taxed as a real estate investment trust, commencing with the year ended December 31, 2017. Additional information is available at www.innovativeindustrialproperties.com.

Innovative Industrial Properties Forward-Looking Statements

This press release contains statements that IIP believes to be “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than historical facts, including, without limitation, statements regarding the leases of the properties, Columbia Care and the New Jersey regulated cannabis market, are forward-looking statements. When used in this press release, words such as we “expect,” “intend,” “plan,” “estimate,” “anticipate,” “believe” or “should” or the negative thereof or similar terminology are generally intended to identify forward-looking statements. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, such statements. Investors should not place undue reliance upon forward-looking statements. IIP disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contacts

Catherine Hastings

Chief Financial Officer, Chief Accounting Officer and Treasurer

Innovative Industrial Properties, Inc.

(858) 997-3332

Categories
Art & Life

Advocacy groups: Legalize it! Tons of benefits

Recently, a group of more than 50 physicians called Doctors for Cannabis Regulation (DFCR) announced their presence and their purpose, endorsing marijuana for adult recreational use and public health benefits.

DFCR offers a break from the American Medical Association (AMA) stance on medical marijuana. Even though the AMA is the largest membership of doctors in the country, the smaller group, DFCR, is making an argument that legalizing marijuana does more good than harm.

Photo by Mike Theiler/AFP Here, holding a sign in front of the White House on April 2, Charles Schatz of Bel Air, Md., joins dozens of demonstrators, demanding the use of marijuana for medical cases.
Photo by Mike Theiler/AFP
Here, holding a sign in front of the White House on April 2, Charles Schatz of Bel Air, Md., joins dozens of demonstrators, demanding the use of marijuana for medical cases.

According to Christopher Ingraham in the Washington Post article, the DFCR cites “hundreds of thousands of annual marijuana arrests, racial and economic disparities in marijuana enforcement, and the role of prohibition in keeping marijuana prices high and lucrative to violent drug dealers…”

Ingraham notes that the physicians believe that allowing the legalization of marijuana and regulating it is the best way to avoid criminalization from illicit drug trade, to ensure public safety, and to combat the negative consequences of strict enforcement polices in certain disadvantaged communities.

At the federal level, the Senate Appropriations Committee also recently passed an amendment allowing doctors at the Veterans Health Administration, (VA), to use marijuana or cannabis to treat certain illnesses such as anxiety and post-traumatic stress disorder (PTSD) in their patients.

The drug is known to be beneficial for a wide array of illnesses such as pain, mental health issues, eyesight, seizures, respiratory illnesses, and even certain immune disorders.

However, there are some who oppose the use of the drug because of its addictive nature.

‘”You don’t have to be pro-marijuana to be opposed to it’s prohibition,”‘ said the founder and board president of DFCR, David L. Nathan.

Nathan addressed the facts that nine percent of adults who use the drug become dependent on it and that heavy uses in adolescents can damage the development of their brains.

Nevertheless, according to researchers, this drug is known to be less harmful to individuals and society than other legal common drugs such as alcohol and tobacco.