On November 7, 2023, 57% of Ohio voters approved the legalization of adult-use cannabis, making Ohio the 24th state to legalize recreational use. The measure allows adults to possess up to 2.5 ounces of cannabis or up to 15 grams of cannabis extract. The law goes into effect on December 7, 2023 but there is still plenty that is unclear in regard to the legislation surrounding new licensing and comprehensive language on adult-use cannabis.
Additionally, the state is making strides to increase access to the current medical market. Licensed cultivators can apply to double the canopy size from 25,000 sq. ft. to 50,000 sq. ft. for Level 1 and from 3,000 sq. ft. to 6,000 sq. ft. for Level 2 operators.
July 2023 | AYR Wellness announced it entered into an option agreement to acquire Twice Wellness
December 2022 | Vext Science announced its acquisition of Appalachian Pharm Processing for $13MM
October 2021 | Acreage Holdings acquired Green Leaf Gardens LLC cultivation, processing and retail operations in Ohio
July 2021 | Verano acquired Mad River Remedies
July 2021 | Columbia Care acquired four dispensaries from CannAscend for $14MM
March 2021 | AYR Strategies acquired cultivator Parma Wellness Center LLC in a $17MM cash deal
The medical market expansion is underway. Regulators will allow the licensed cultivators to apply for canopy expansion from 25,000 sq. ft. to 50,000 sq. ft. for Level 1 and from 3,000 sq. ft. to 6,000 sq. ft. for Level 2 operators. The narrow canopy limits have constrained the market, and with 73 new dispensary licenses issued, expansion is imperative.
Investors have ample opportunity to invest in attractive ROI projects over the next several years as the medical market expands and ultimately transitions to adult-use.
With adult-use now legalized, existing license holders should solidify their market positions and hold on for a fun ride as retail sales are now emminent; there is much to be excited about in the buckeye state.
*Cultivators are licensed as either Level I, limited to 25K sq.ft., and expansions up to 50K sq.ft. or Level II, limited to 3K sq.ft. with expansions up to 6K sq.ft. The department can then approve Level I and II growers for up to 75K sq.ft. and 9K sq.ft. of expansion, respectively.