Cities that were early to opt in to recreational cannabis are now seeing the benefits from entrepreneurs redeveloping old properties into sleek, modern retail businesses.
Muskegon, for example, initially created a medical marijuana overlay district to steer development within an underutilized industrial section of the city. The city’s first dispensary, Park Place Provisionary at 1922 Park St. that has been rebranded as New Standard Park Place, started selling recreational cannabis on Jan. 17, 2020.
Muskegon now has six dispensaries just east of Seaway Drive. Last fall, city commissioners in a divided vote amended its zoning ordinance to expand the marijuana district and add six individual properties.
Muskegon Planning Director Mike Franzak called the city’s overlay district approach a success story.
“We took areas that were heavily disinvested in and very blighted along major corridors that are easy to find,” Franzak said. “We’ve been able to take that area and just see an amazing transformation. It looks like a completely different corridor than it was before, and that was with our initial overlay district.”
The city’s zoning ordinance was recently amended again to allow microbusinesses — which can grow up to 150 plants, process and sell products to adults but not other adult-use establishments — to operate at additional locations in the city, including near downtown.
“We decided there were some other key properties throughout the city we had not been able to get reinvestment on, some older buildings that could use the cannabis industry to jumpstart other projects in the area,” Franzak said.
Massive, aging industrial buildings around the city are also being reviewed for redevelopment into non-retail cannabis establishments, Franzak said.
“The investment doesn’t seem to be stopping,” he said. “It’s just been really good for our economy, we’re seeing a lot of job hiring out of it, and it strengthens our tax base.”
The city of Kalamazoo has experienced similar success since adopting its medical marijuana ordinance in 2018, said Assistant City Planner Pete Eldridge. The city now has 12 recreational cannabis retail stores operating across the city, according to state data.
“There has been rehabilitation of warehouses in the manufacturing areas, older buildings on some of our community corridors like Portage Street, and it’s definitely made an impact on some of our decaying building stock in a very positive way,” Eldridge said.
Prime real estate
Julie Moorehead, co-owner of Timber Cannabis Co. at 313 W. Laketon Ave. in Muskegon, initially saw potential in the property that included a rundown former banquet hall.
“It’s right on Laketon Avenue, so I’m sure the city is enjoying the refresh that cannabis companies are doing in the city,” Moorehead said. “Once land is zoned into a ‘green area,’ the prices go sky high.”
While cities that have opted in to recreational cannabis have taken varied approaches to zoning the industry, skyrocketing real estate prices have tended to follow.
“Right now, that’s the impediment to the growth of the industry: The lack of available properties, no question,” said Ben Wrigley, a partner at Cannalex Law in Cascade Township. “The properties are in such demand because there are only so many of them.”
Timber Cannabis installed a new roof, resurfaced the parking lot, and added new flooring and landscaping.
“I was really surprised and excited at our final product. It looks like a classy establishment now with a comfortable atmosphere,” Moorehead said.
Muskegon’s overlay district approach was an alternative to capping the number of cannabis businesses that could operate there. As a result, new retail stores are competing for customers, often doing so with freshly upgraded facilities.
“A lot of our employees live nearby and appreciate the nice aesthetic that’s been going on,” Moorehead said.
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