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Marijuana and property, schwag to mids to dank

Herbal House, a medical marijuana dispensary, 421 W Gray, Norman. [PHOTO PROVIDED BY CRAIG BLANKENSHIP]
Herbal House, a medical marijuana dispensary, 421 W Gray, Norman. [PHOTO PROVIDED BY CRAIG BLANKENSHIP]

The marijuana business is turning schwag property to mids and mids to dank.

That's cannabis speak. Schwag is bad, mids is middling, dank is top shelf. I had to look that up. In the marijuana world, the terms are as common as Class A, Class B and Class C are in the world of commercial property.

Those worlds are colliding, as we know. A study by the National Association of Realtors, "Marijuana and Real Estate: A Budding Issue," yielded statistics supporting what is known to be happening here:

Despite some people's concern over the sheer number of dispensaries and growers, and despite a few landlords' negative experiences, the marijuana business, whether for medical or recreational use, is especially good for renovating worn-out retail shops and functionally obsolete warehouses.

My recent comments on the study, a survey of Realtors, drew thoughtful responses from a proprietor and a real estate broker. Both, one positive, one not so positive, add to the picture.

Positive

I’m Craig Blankenship. I live in Oak Tree and own a dispensary and processing facility in Norman on Gray Street.

Stop in Herbal House at 421 West Gray. Take a tour of the facility and then let’s talk property values. I paid $75 per square foot for my 6,000-square-foot building, which was 20 years old and had a riser (sprinkler control) room and full fire sprinklers. It was up to code.

Eighteen months later, the building next to me is for sale. It’s a 45-year-old building and not up to code, ADA, etc. They are asking $150 per square foot.

We are located in Norman’s City Center City Form-Based Code area. Anytime a building changes ownership or use, it must be brought up totally to code. Except the Campus Corner area, which the city council exempted! Surprise!

So if a dispensary (in another city) opens and looks like a slum, it’s the fault of the city council that allows such things. Even in Norman outside the CCFBC, some look less than desirable.

Norman told us we are the template for others to follow. We are on Instagram, but come see for yourself when you are in Norman. Thanks.

Will do!

Not so positive

From T. Mark KcKee with KW Commercial, 1624 SW 122:

Richard, I appreciate your column this past Saturday and had some insight from what I have experienced with this new industry.

Rents and deposits for marijuana-related businesses are typically higher than other tenants. I've seen this from $2 per square foot, or double and more, due to the risks and uncertainties, being new to Oklahoma. There are concerns in regards to federal laws, changing regulations, insurance coverage issues, etc.

The OKC metro area is an over-saturated market in the number of dispensaries presently, and there will be many available storefront vacancies in the near future. These landlords will be left with empty units unless they are able to find a new tenant quickly, which may result in rent reductions, concessions or both.

I have already had a couple of clients who have had their marijuana-related tenant move out, breaking their lease and being delinquent in their rent.

I truly hope that these companies that came to do business here are here to make a living by helping their customers with good-quality products, not just to make a quick buck for themselves.

There you go: two good anecdotes. This is all still so new here, that's about all we have.

A boom is on, for sure. How booms generally play out is well known. Exactly how this one plays out is still anybody's guess.

Email Real Estate Editor Richard Mize at rmize@oklahoman.com.

Related Photos
<strong>A view inside Herbal House, a medical marijuana dispensary, 421 W Gray, Norman. [PHOTO PROVIDED BY CRAIG BLANKENSHIP]</strong>

A view inside Herbal House, a medical marijuana dispensary, 421 W Gray, Norman. [PHOTO PROVIDED BY CRAIG BLANKENSHIP]

<figure><img src="//cdn2.newsok.biz/cache/r960-68d4709ff9b97ed24ad64fc71e37b106.jpg" alt="Photo - A view inside Herbal House, a medical marijuana dispensary, 421 W Gray, Norman. [PHOTO PROVIDED BY CRAIG BLANKENSHIP] " title=" A view inside Herbal House, a medical marijuana dispensary, 421 W Gray, Norman. [PHOTO PROVIDED BY CRAIG BLANKENSHIP] "><figcaption> A view inside Herbal House, a medical marijuana dispensary, 421 W Gray, Norman. [PHOTO PROVIDED BY CRAIG BLANKENSHIP] </figcaption></figure><figure><img src="//cdn2.newsok.biz/cache/r960-09ce1892a6f4d862a391091f0bd56290.jpg" alt="Photo - Herbal House, a medical marijuana dispensary, 421 W Gray, Norman. [PHOTO PROVIDED BY CRAIG BLANKENSHIP] " title=" Herbal House, a medical marijuana dispensary, 421 W Gray, Norman. [PHOTO PROVIDED BY CRAIG BLANKENSHIP] "><figcaption> Herbal House, a medical marijuana dispensary, 421 W Gray, Norman. [PHOTO PROVIDED BY CRAIG BLANKENSHIP] </figcaption></figure>
Richard Mize

Real estate editor Richard Mize has edited The Oklahoman's weekly residential real estate section and covered housing, commercial real estate, construction, development, finance and related business since 1999. From 1989 to 1999, he worked... Read more ›

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