Cannabis Sweeps Shut Down Unlicensed Marijuana Businesses

With the passage of the Compassionate Use Act of 1996, California became the first state in the country to legalize the use of medical marijuana. Twenty years later, in 2016, the Adult Use of Marijuana Act legalized the recreational use of cannabis.

There Are 182 Licensed Cannabis Businesses in Los Angeles

By 2018, there were 6,000 licensed cannabis businesses in the Golden State, as The Orange County Register reports — although retail marijuana businesses are not allowed in more than three quarters of the state’s 500 municipalities. And currently, there are 182 businesses in Los Angeles that have temporary approval to sell adult or medicinal use cannabis and cannabis products, according to the City of Los Angeles Department of Cannabis Regulation.

Establishment Restrictions for Marijuana Businesses

In L.A., the establishment of a marijuana business is subject to the provisions laid out in the Commercial Cannabis Location Restriction Ordinance, which was adopted in December 2017. This ordinance enables certain commercial cannabis businesses to operate legally on condition that they are licensed by both the state and the city. They must remain in compliance with the location requirements in the ordinance. It also identifies zones where specific types of commercial cannabis businesses may operate. Plus, it requires that organizations observe predetermined distances from sensitive sites such as schools, as well as from other cannabis businesses.

Furthermore, the Los Angeles County Department of Regional Planning identifies provides maps in PDF form that identify the unincorporated areas of the county where commercial marijuana businesses could potentially be established.

Authorities Are Shutting Down Illegal Cannabis Businesses

However, despite the legalization of both medicinal and recreational cannabis businesses, the illegal market for marijuana remains vast. According to experts, this is likely due to the fact that many growers and sellers operated under the radar for years and are now unwilling to jump through the hoops required to obtain a permit. On top of that, legal commercial cannabis businesses pay more than 30 percent in state and city taxes — and illegal ones pay nothing.

Clearly, this places legal cannabis businesses at a disadvantage. Many licensed operators are complaining to the authorities about their illegal counterparts. So it’s not surprising that law enforcement have been shutting down unlicensed marijuana businesses throughout the county. For example, Marijuana Business Daily reports that on February 5th, the Department of Consumer Affairs Division of Investigation’s Cannabis Enforcement Unity and the Los Angeles Police Department executed a search warrant on an illegal cannabis business. This resulted in the seizure of two firearms and over $27,000 in cannabis products, as well as the arrests of six persons of interest.

How to Find a Compliant Property to Establish a Legal Marijuana Business

So how can you go about finding a compliant property to establish your legal marijuana business? The answer is to speak with one of our real estate experts at Peak Commercial. We’ll discuss the nature of your business with you since there are different restrictions for retail operations than for cultivation businesses. We’ll also review the best area for you since each city has its own requirements. Then, once we’ve determined what your specific wishes are for the property, we’ll suggest some properties that meet all your requirements. For more information, please contact our offices today.

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