Cannabis leasing is incredibly complicated for both lessors and lessees. But things can get a lot more complicated in competitive license jurisdictions. I’ve worked with both lessors and lessee-applicants in competitive licensing jurisdictions, and today want to highlight some of the key things I’ve seen over the years.
#1 Why competitive licensing is different from everything else
If you’re reading this and are not familiar with competitive licensing, I’m referring to localities (or in some cases, states) that only allow a small, fixed number of licenses. In competitive licensing jurisdictions, you’ll often see dozens of applicants for a small handful of available licenses – for example, thirty or so applicants for four licenses.
You may point out that most cities in fact have some kind of cap on licenses, either expressly, because there is a finite application window, or because there is restrictive zoning. However, what I refer to as competitive licensing is a situation where, maybe 1-6 licenses will be available in one short application period.
This is why I refer to “competitive” licensing. And it gets truly competitive. Applicants may end up spending hundreds of thousands on legal, design, consulting, and other fees to just to submit an
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