Land and Cannabis Farms

11 Replies

I have a client who is looking to purchase land in California and permit it for Cannabis growing and then renting out parcels for income. I haven't heard of this type of investment as most people grow on their own land and thought it was an interesting landlord tenant situation. 

Would love any info or leads in the direction of purchasing land, cannabis and renting land to grow agriculture.

Thanks,

MJ

Hi MJ,

I’m in Monterey County, which is the self proclaimed cannabis cultivation Captial of CA. The whole situation varies by county and even by city.

If you send me a DM we can chat further and I can get you up to speed.

Most of the green houses in the area are already gobbled up.  farmland here is GOLD.  There is not much on the open market.  It is all about the connections and off-market stuff.

HI MJ, 

I have a real estate based deal similar to what your client is looking for in Redding, CA. Give me a shout and we can see if it's what your client is looking for.

Best, E

@MJ Barnett   Before you do this google...  "federal civil asset forfeiture."

When this happens I am afraid there is going to be a huge amount of whining.  Let me give you a little heads up because you probably don't have any experience with federal law enforcement.

Step 1.  They take your property.  This post is enough evidence for them to get a court order to take it.

Step 2.  You decide if you want to fight it or not.  If you don't they keep it.

Step 3.  If you fight it they will bring criminal charges that could include federal drug charges, money laundering, RICO, non RICO conspiracy.

Step 4.  You lose in court because @James Kendall and @Ethan Pacewiczh   publically joined you in a criminal conspiracy.

Donald Trump and the AG have both gone on record that they want this to happen.  Just because they have not done it yet does not mean they will not do it tomorrow.

@MJ Barnett

A great case of high risk and high reward. They just shut down a big grower in San Diego that had all their legal paperwork in place a couple of months ago but that was before the latest ruling that it's now legal to cultivate here:

http://www.sandiegouniontribune.com/news/politics/...

I think when you're on the risky frontier of something new like this, you better be friends with the councilmen because civil asset forfeiture is alive and businesses have been shut down at the drop of a hat.

@MJ Barnett In addition to the items that @Michael Biggs and @Ray Lai pointed out, your client may have a significant challenge in banking the proceeds from the parcel rental. Banks are stuck between a rock and a hard place when it comes to providing services to the cannabis industry. 

Not to mention insurance will not cover any loss even if they have been charging you for years. The federal government will not provide FEMA support if a wild fire wipes you out. The absolute most extreme case is someone getting killed robbing the place or providing security at the place or using the product. The federal penalty could be the federal death penalty.

If the federal government cracks down they will not treat this like white collar crime.  They will treat this like you are a rich drug lord.

Ray. Thanks for the info. I had heard that San Diego is still not very friendly and my client was told to steer away from it.
MJ

Originally posted by @Ray Lai :

@MJ Barnett

A great case of high risk and high reward. They just shut down a big grower in San Diego that had all their legal paperwork in place a couple of months ago but that was before the latest ruling that it's now legal to cultivate here:

http://www.sandiegouniontribune.com/news/politics/...

I think when you're on the risky frontier of something new like this, you better be friends with the councilmen because civil asset forfeiture is alive and businesses have been shut down at the drop of a hat.

@MJ Barnett I know this is an older post, but thought I'd jump in and see what you've found out.  The "golden triangle" of pot growing is Shasta, Humboldt and Trinity Counties in CA. The HOT summers and abundance of water produce world renowned pot. However; the State of CA is going to tax and charge so many fees that I don't see where there's going to be any big incentives for people to grow legally. In addition, many areas such as Shasta County are going to outlaw growing for recreational use, and will require any grows to be indoors. The City of Shasta Lake has fully embraced pot growing, and is allowing it in the industrial park. 

I actually own 20 acres of ag land in Redding, but it's in Shasta County, and there is no pot growing outdoors allowed. 

However; as mentioned, there are still many pitfalls involved, as it is still a federal crime, and land can be seized, etc. In addition, the security required to protect grows will be expensive, because make no mistake there are people being killed over pot, even small amounts. 

@Ethan Pacewiczh just curious, where in Redding does your client have such a setup, as the only place it's legal around there is in Shasta Lake City, not Redding. However; Redding will be opening the industrial park to growers probably after the first part of the year (probably some type of lottery or ?) .  

The point being, in CA you can bet by the time the politicians are done with it, there will be no money in growing legal pot, but plenty of risk. 

Originally posted by @Michael Biggs :

Not to mention insurance will not cover any loss even if they have been charging you for years. The federal government will not provide FEMA support if a wild fire wipes you out. The absolute most extreme case is someone getting killed robbing the place or providing security at the place or using the product. The federal penalty could be the federal death penalty.

If the federal government cracks down they will not treat this like white collar crime.  They will treat this like you are a rich drug lord.

 I'm curious about this because a lot of grows were destroyed by the Napa fires just recently....

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here