How To Make Your Cannabis Property Listing More Attractive: ATTACHING MUNICIPAL PERMITS
As it stands right now, Michigan’s cannabis real estate market volatile and ever changing, but it appears we are in a seller friendly market. Being able to work with clients on both the buy and sell side, I can tell you from experience that right now there are way more legitimate buyers than there are sellers, which creates an inflated value in the Michigan marketplace. I won’t be getting into whether or not it’s a good idea to hold on to your property, or whether you should try and sell right now, however, I will discuss why I think it might be beneficial to consider applying for the municipal licenses or permits yourself.
As I’m sure you are aware of, each city in Michigan may opt into/out of allowing Medical or adult use cannabis businesses from being opened within their city limits. Once opted in, each municipality then drafts an MMFLA or MRTMA ordinance dictating what zoning districts licenses are to be operated out of, what documents are needed for an application, and how many of each license the city is going to hand out. Some cities are uncapped, meaning there is no limit to the amount of each license they will approve. Other cities, like Harrison Township, have put a finite number of license types that they will approve (e.g. eighteen licenses for growers and processors, two for secure transporters, etc.), and once they have met that limit, they will no longer be accepting municipal cannabis applications.
Now you might ask yourself, “well how to does this apply to me, I’m just trying to sell my property, not start a business “. There are two main reasons to consider applying for the permits yourself, one is brevity, and the other is capped markets. If you own a piece of property in a capped municipality, you might find yourself out of luck. By the time someone wants to close on your property for a particular cannabis purpose you and the buyer may realize the city has met its quota and is no longer accepting applicants. Your property will lose a tremendous amount of value to buyers if they can’t apply for a particular permit because they have all been given out. What you could do as a property owner is to try and get prequalified through the State of Michigan and then apply for the particular municipal licenses yourself before they are all gone. This will ensure your property’s usage will be maximized which will stabilize and even increase your property’s value.
Even if you’re not worried about city licenses running out because you are an in uncapped market, you might be surprised how many buyers I come across who are willing to pay a premium for properties they can act on fast. For example, one of the main reasons why there are significantly more cultivation projects in Warren compared to Detroit is that in Warren, you can get a municipal license in as little as a month, whereas Detroit can take up to 6-8 months to secure the necessary special land use permit.
If a particular property already has the municipal licenses attached to it, that can save the buyer valuable weeks/months applying for them themselves. If you happen to just be sitting on plot of land or property and you have the financial capability to get prequalified and apply for the municipal licenses yourself, you might want to consider doing so because in the long run you could be saving your potential buyer valuable time, who then in return might end up paying a premium just to avoid that process.
Our affiliated law firm, Scott Roberts Law , is extremely affordable and has an excellent track for both prequalification applications and municipal permit applications. Being a cannabis business and real estate attorney and a realtor allows me to approach certain issues like these with a unique perspective. Taking the extra step to make your property stand out might not be for everyone, but if you have the inkling to do so, please reach out to any of our qualified realtors or cannabis licensing experts about how we can help get your property sold at its highest value.