Tenants of hemp: The pros and cons of leasing greenhouse space to hemp production

We have provided an excerpt from an article by Greenhouse Management magazine, which discusses the pros and cons of leasing greenhouse space to hemp production:

“‘For the last six years, people have been calling me about cannabis,’ says Wheat, a master gardener and member of the Society of American Florists. ‘I wasn’t going to grow marijuana in my greenhouse — for security purposes, for reputation purposes, for a lot of different reasons. It just wasn’t the right fit for our family retail business in small downtown Lafayette.’

“Then, Wheat started taking CBD oil for joint problems. Once he learned the difference between marijuana (which contains psychoactive THC) and hemp (which produces CBD), he recognized the crop’s potential. So, he was intrigued when a representative from Front Range Biosciences walked in one day and asked Wheat to meet with Jonathan Vaught, the company’s co-founder and CEO, about leasing some greenhouse space for hemp production.

“Other hemp growers offered Wheat a percentage of profits after processing — and although those six-digit numbers were enticing, the uncertainties of sharecropping posed too many risks. Wheat wanted regular rent payments, but when he calculated his costs, the price even shocked him. However, Vaught understood greenhouse operating expenses, as he was already renting facilities across the country. Plus, Wheat’s business — located just two miles from FRB’s lab — offered a prime location, so Vaught even offered to renovate the space to meet his operation’s standards.

“‘We agreed on the length of the lease and the price per square foot — which, across the country, goes anywhere from $4 per square foot for a greenhouse that might need a lot of repair, all the way up to $10 per square foot if the greenhouse is in great condition,’ says Wheat, who couldn’t share specific details, but emphasized that Vaught has been a wonderful partner.

“Although rent payments and renovations sweetened the deal, these decisions should be based on due diligence, not just dollars.

“‘Right now, in the cannabis world, people are willing to invest significant money to retrofit a structure if it’s faster than building a new one,’ Vaught says. ‘But beware of the hype. Vet your tenants and get to know them; make sure they’ve got strong financial models and business plans behind them. It’s a long-term deal, kind of like a marriage, so you don’t want to jump into it overnight. If you do your due diligence, you’ll be able to weed out the ones that aren’t going to be sustainable partnerships.'”

You can read the full article here.

Additional Information:
  • Searching for cannabinoid-rich hemp plants? To view our current availability for cannabinoid-rich clones from our Clean Stock® Program, as well as our seedlings and feminized seeds, contact our sales team at: sales@frontrangebio.com or complete an order inquiry at: https://www.frontrangebio.com/order_inquiries/
  • Stay up-to-date with FRB’s current events and information by following our blog and news pages.
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