On January 1, 2020, the Illinois Department of Financial and Professional Regulation allowed thirty-seven (37) medical cannabis dispensaries to sell recreational products. During the first five days, adult-use stores sold over $11 million in sales with some stores closing due to product shortages.
The state will hand out a total of seventy-five (75) recreational dispensary licenses by May 1, 2020. The licenses will be allocated to various districts in the state with a majority of the licenses, forty-seven (47), clustered around Cook County. The strong start should kick off a competitive real estate market for the limited retail sites in these cities and counties.
Applicants for one of the remaining licenses should do these five (5) things in order to remain competitive as possible.
1) Your competition is already looking for the best property for their adult-use store- you should too. We expect the real estate market in Illinois to heat up quickly. Each city and county can determine whether to allow commercial cannabis businesses. Our OBEDIO data shows that there are over 100 cities and counties that will accept retail businesses.
2) Compare the available cities for one that meets your strategic goals. Analyze available information to find a city that fits within your business model including customer demographics, taxes, available locations and whether the city is cannabis-friendly.
3) Contact the city planning department to start a dialogue. The planning department can tell you whether the city is still accepting applications, where you are in the queue of applications and whether there is any real estate left within the permitted zoning area. Although the state law establishes certain buffer zones, the city’s zoning regulations will establish the permitted locations as well as additional buffer zone restrictions.
4) Assess the availability of real estate in the permitted areas within the city of your choice and understand the competitive landscape. Are there other dispensaries in the city?
5) Start the land use permit process. Applicants with real estate can start this process before licenses are awarded. By doing so, you can claim your area within a city and start getting your local approvals. This will allow you to open the doors quicker and generate revenue.
The benefit of taking these five steps is that you will be opening doors much sooner if you do receive a license. The applicants that wait could be losing out on the best cities, paying more for a property, be delayed due to long queues in the city approval process, and lose valuable time to competitors. This process can help you get the most value out of your investment.