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Illinois Medical Marijuana Company Sells Big Asset

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PharmaCann is based out of Illinois but also operates medical marijuana cultivation facilities in New York. Its cultivation facility in Hamptonburgh was sold to Innovative Industrial Properties, the nation’s first medical marijuana real-estate investment trust to be traded publicly.

The investment firm signed a 15-year lease with PharmaCann so it can continue its operations in the facility, according to Chicago Tribune. The transaction was done to help PharmaCann obtain capital to keep its operations going. This isn’t the first time a sell and lease-back transaction has occurred in the marijuana industry. It’s an ideal option for struggling companies to obtain necessary capital to maintain operations.

Jeremy Unruh of PharmaCann said, “Money that we receive from the sale-lease-back will go a long way. It’s a great opportunity because there are not a lot of other options out there.”

With a few conditions in place, the U.S. Treasury Department gave permission to banks to work with legal marijuana businesses. The trouble is, most financial institutions still refuse, making it difficult for legally operating marijuana businesses to maintain proper capital.

A few banks in Illinois will work with medical marijuana businesses.

Kendell Lang of Fusion Properties believes that more Illinois medical marijuana companies will seek similar arrangements to what PharmaCann and Innovative Industrial Properties have.

Lang said, “I think it’s a matter of time.”