Page 40 - BusinessWest July 24, 2023

A number of properties have been purchased or leased, and at prices that could not have imagined a decade ago. And as some cannabis businesses close or leave the market and others delay their plans to start, questions mount about all that real estate and what will happen with it.
“A lot of the buildings were locked up because they were purchased at a much higher price than they were prob- ably worth, and now those companies are not going forward, or their time- lines are stretched out,” he said. “Are they going to sell these buildings? Are they going to be able to maintain these buildings? They come with tax bills,
and they come with maintenance; if you don’t have anything going on inside that you’re making money with, it becomes more of a struggle.”
The most visible manifestation of this changing landscape is the property at 56 Canal St., home (but not for much longer) to Trulieve’s 126,000-square- foot growing, processing, and testing facility, the former Conklin Office Fur- niture building. Truelieve poured tens of millions into purchasing, renovating, and retrofitting the former mill for can- nabis-related uses, said Vega, who won- dered out loud how the company could possibly recover that kind of investment given the current fortunes of the canna-
bis industry.
“We’re wondering ... how does that
property move? What does that com- pany want to sell it for, and what is the acquisition cost going to be?” he asked. “It comes currently with a $300,000 tax bill; that’s a lot of money to keep a building empty. We’re hoping they’re able to move it or work with the city to find a public solution.”
While some ventures are slated to open in the coming weeks and months, Vega said, there are at least 20 prop- erties for which special permits have been approved — for one or more of the several types of cannabis-related businesses — but where there has been
little movement, if any, on site toward opening those businesses.
Vega said he was only half-kidding when he suggested that Trulieve donate its Canal Street property to the city
and its redevelopment authority, which could then try to attract more and dif- ferent kinds of indoor agriculture busi- nesses. Among other things, the trans- formation of old mills across the city for cannabis-related uses has shown what can be done with those proper-
“We’re wondering ... how does that property move? What does that company
want to sell it for, and what is the acquisition cost going to be? It comes currently with a $300,000 tax bill; that’s a lot of money to keep a building empty. We’re hoping they’re able to move it or work with the city to find a public solution.”
ties, he noted, adding that indoor agri- culture could be a growth industry for the city — literally and figuratively — moving forward.
Meanwhile, another emerging model for these mills could be an incubator-like facility, such as the one taking shape at 1 Cabot St., another old mill, the former Riverside Paper Co. building, purchased by Tom and Karen Cusano in 2018.
There, several smaller companies, many of them social-equity ventures, are moving forward with plans, Tom said, adding that this is a different kind of model, and one he believes has some staying power.
“We have one operating tenant and four tenants who are in the licensing process, and we’re building out their space — they should be operational within 90 to 120 days,” he said, add- ing that this model calls for reason- able lease rates, most buildout han- dled by the owner, and opportunities to grow if and when the businesses
do.For this issue and its focus on com- mercial real estate, we take a look
at what’s happening in Holyoke —
and not happening, as the case may be — and what it all means moving forward.
Pot Luck
Vega told BusinessWest that the cannabis experience — and it is ongo- ing — has benefited Holyoke in a num- ber of ways.
Beyond the hundreds of thousands of square feet of old mill space that
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