New Jersey real estate regulations are a moving target, as a good number of municipalities opted out of allowing cannabis businesses, and those that have permitted NJ weed license holders to operate are able to fine-tune laws as desired. And with new CRE requirements, it’s often more efficient and affordable to trust an expert to help maneuver the limited eligible and compliant commercial real estate properties in green-zone municipal overlays.
Savvy New Jersey cannabusiness owners trust professionals like Canna Real Estate Group, who have assembled top-notch design and build teams in architecture, engineering and general construction to ensure specific site requirements are met exactly. CREG provides active site selection, property acquisition due diligence and a network of reliable vendors for multiple NJ licensees for cultivation, manufacturing and retail dispensaries.
Obtaining a New Jersey cultivation license is no longer restricted to a specific number. At the time of legislation enactment in 2021, the state set a two-year cap that limited cultivation licenses to 37, with micro-cultivators being the exception. With only seven cultivators supplying 13 adult-use retailers upon the launch of the recreational market a year ago, the New Jersey Cannabis Regulatory Commission (CRC) decided not to renew the cap in an effort to expand supply.
CRC Executive Director Jeff Brown told MJBizDaily that decision was made, in part, “because there’s plenty of room in the market for more cultivation. The market has a long way to grow here; all indicators show that we need more cultivation here,” he said.
New Jersey CannaBusiness Association President Edmund DeVeaux said the state’s medical marijuana patients already expressed “concerns, if not complaints, about quantity and quality. So now that we have an adult-use industry on top of our medical industry, those concerns, those criticisms continue,” he said.
Every New Jersey cannabusiness, current and potential, has a recent reason to rejoice, as the state recently approved legislation that allows licensed cannabis businesses to deduct standard business expenses on state tax returns, which are prohibited from deduction on federal tax returns. Approved by both chambers (Senate in a vote of 32-3, and the New Jersey assembly in a vote of 69-8), the final step of signing into law by Gov. Phil Murphy is expected soon.
NJ industry businesses would be able to begin taking advantage of this business boost in 2024, especially as New Jersey cannabis regulations purposefully avoid restrictions on raising money or creating partnerships with out-of-state operators to open the market for as many interested business owners as possible. This is especially good news as the beginning of 2023 saw an increase in the New Jersey Social Equity Excise Fee tax from $1.10 to $1.52 per ounce of cannabis sold by a Class 1 Cannabis Cultivator license holder. License holders who are required to pay the tax must report it on their monthly SF-100 returns. SF-100 returns are due on the 20th of each month following the end of the filing period, and it is key to maintain accurate records to establish when exempt sales occur.
Opportunity beyond cultivation, processing and retail recently became available in the form of cannabis consumption areas, or cannabis lounges, in the Garden State. The New Jersey Cannabis Regulatory Commission approved proposed rules to allow these establishments, including both indoor and outdoor options contingent on enclosure and guest age minimum of 21+ years. Application fees will be $1,000 for businesses and microbusinesses, and $5,000 for standard licensing for other businesses.
Per the CRC, the proposed rules will appear in the New Jersey Register, then will be open for public comment for 60 days. The rules will then need to be adopted and a Notice of Application Acceptance issued before existing dispensaries can apply to expand their facilities to allow onsite consumption. Investors are eager to be a part of this update to New Jersey dispensary regulations.
Lastly, encouraging women to apply for and utilize a New Jersey marijuana license is also becoming a focus. According to the 2022 report, “Diversity, Equity & Inclusion in the Cannabis Industry,” women holding executive positions in the industry grew by only a percentage point over the past year, to 23.1%. This number is below national averages for all businesses.
With this in mind, the New Jersey Business Action Center (NJBAC) Cannabis Training Academy is striving to increase those numbers by assisting applicants through a 10-week program in both English and Spanish. Here, applicants will learn details regarding applications, business plans, municipal approvals, standard operating procedures, and working with government agencies and vendors.
Did you receive a NJ cannabis business license? CREG is market-savvy and prepared to assist new licensees with their CRE searches. Canna Real Estate Group specializes in commercial cannabis real estate and provides financial, architecture and construction consulting for business owners and operators. With more than 30 years of success, CREG is the optimal guide to navigate New Jersey real estate, as well as dispensary and cultivation license regulations. Start with a consultation today!