A fast-growing cannabis company has purchased a 34-acre property in Jamesport for $42.5 million from Van de Wetering Greenhouses in one of the largest purchases in the burgeoning industry. It is the first known marijuana-related real estate buy on the East End since New York State legalized adult-use cannabis in March.
Columbia Care Inc., which already operates a medical cannabis dispensary in Riverhead, has plans for a cultivation site at 5784 Sound Avenue with the first harvest and sales for the state’s medical marijuana program expected later this year.
The purchase is being completed in two phases, the second of which will include 740,000 square feet of greenhouse space, which Van de Wetering currently uses for growing ornamental flowers and other plants. The space allows for 200,000 square feet of “incremental grow capacity, situated perfectly for both retail distribution to Columbia Care’s three NYC and Long Island dispensaries and wholesale distribution to the most densely populated metropolitan area in the United States,” according to a statement.
It will be one of the largest operating greenhouse sites on the East Coast, the company said.
The total purchase price of $42.5M includes $15 million in cash and $27.5 million in Columbia Care stock, the publicly traded company said in its announcement. The company has already made an initial payment of $30 million, but the remaining $12.5 million in stock payment will be turned over in August when the second phase is complete.
“As a company whose roots are in New York, it has been incredibly important that we build a scalable, vertically-integrated operation in the state that not only delivers the very best quality and prices to our patients and partners today, but also ensures that we can continue to deliver on our mission to New Yorkers through future legal cannabis programs,” said Nicholas Vita, CEO of Columbia Care.
“This is a commitment to our patients, communities, regulators, elected officials and social equity partners that we are here for the long term and intend to be the leaders who define cannabis in New York State – made in New York, by New Yorkers for New Yorkers,” he said. “We are eager to see New York’s regulated market emerge as one of the top global cannabis markets, with some market size estimates exceeding $5B by 2025 and more than 75,000 jobs created by 2027. We intend to continue to invest in opportunities that support this growth for all.”
The new facility could be an economic driver for Suffolk County, and bring more jobs to eastern Long Island. According to a March 2021 report from the Long Island Association, legalization of adult-use marijuana in New York would increase economic output on Long Island by $878 million annually and create 7,316 jobs in the region. State and local governments would also benefit with increased tax revenues.
Van de Wetering’s owners previously planted and successfully harvested industrial hemp on-site, Columbia Care added. Van de Wetering is expected to continue operating on the site until late 2023. Walter Gravagna, the owner, was not immediately available.
The company, which began in 2012, already has a facility in Rochester that has served more than 120,000 medical cannabis patients in New York since 2015.
“The new site also allows the company to diversify its operations and open opportunities to create potential social equity business partnerships; a dedicated, federally licensed global medical cannabis manufacturing and research hub in Rochester; and support the company’s entrance into the state’s adult-use program,” according to a statement from the company.
Columbia Care currently operates 115 facilities, including 87 dispensaries and 28 cultivation and manufacturing facilities. It offers a myriad of cannabis products from flower, edibles, oils, and tablets, and manufactures brands including Seed & Strain, Amber and Platinum Label CBD.
Email [email protected] with further comments, questions or tips. Follow Behind The Hedges on Twitter, Instagram and Facebook.