The pricey street in Illinois, affectionately dubbed “Magnificent Mile”, could be home to the highest developments in the state’s cannabis industry. Magnificent Mile, or Mag Mile, has been eyed by cannabis corporations who want to seize an opportunity in an area with exorbitant foot traffic. Areas with similar levels of pedestrian foot traffic and cost per square foot associated with the rentals of retail space adequately compare to locations a mile away from the Las Vegas strip and Fifth Avenue in New York.
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One of the locations on Mag Mile that received attention is a multi-level, 30,000 square foot former Apple store location. The space was vacated by Apple after the company moved to a location near the Chicago river in the fall of 2017.
Cannabis companies are aware of the latest decrease in the asking price for retail locations on the Mag Mile and they’re looking to lock the rate in. The cost associated in 2018 for a retail space on Mag Mile averaged to $450 per square foot, which is down $100 from the $550 per square foot average in 2017 and 2016. Empty storefronts and bankruptcies have helped to persuade property owners to decrease the asking price of rent. Those who own property for rent aren’t turning any interested parties away, especially those within the cannabis industry.
Dan Molnar, broker at Baum Realty Group, stated: “There are a lot of unknowns, but everybody is trying to be prepared for whatever the city puts forward. It’s going to be highly trafficked areas with both locals and tourists.”
There are currently 55 medical cannabis dispensaries in the state of Illinois that can now apply to perform recreational cannabis sales. Recreational cannabis sales are set to begin after January 1st, 2020. Each medical dispensary location is also now allowed to open a second dispensary after Governor J.B. Pritzker signed recreational cannabis sales into law.
Numerous other corporations such as Green Thumb Industries, PharmaCann and 4Front Ventures all have their plans to get into the recreational cannabis market as soon as possible. Both PharmaCanna and Green Thumb Industries have plans in place to open five new dispensaries. 4Front Ventures also has a plan to open a recreational cannabis dispensary and has not released where it is looking into.
It is obvious that the motivation for cities to allow the implementation of recreational cannabis dispensaries has shifted significantly since the start of the state’s medical cannabis program. This is believed to be because medical cannabis sales do not share the same beneficial tax rate that recreational cannabis sales will have.
Jeremy Unruh, Director of Public and Regulatory Affairs at PharmaCann, stated: “Five years ago, we were relegated to areas where the municipalities wanted to hide us. Now I don’t think that’s the case, especially given the fact that 3% of total sales can go to the municipality.”
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