Marijuana industry growth might lead to a new real estate boom

by Ephraim Vecina21 Apr 2017
Amid the prospects of legalization and the resulting positive impact on cannabis stocks, a Canadian medical marijuana company has begun paying dividends to its shareholders.

Invictus MD is the first medical cannabis company in Canada to do so—and observers noted that the burgeoning industry’s demand for more space to grow crops is something to watch out for.

“They’ve been nurturing their shareholders along with their crops. Invictus MD’s focus on two verticals—cannabis cultivation and cannabis fertilizer and nutrients—gives it a competitive, low-cost advantage on this playing field,” according to a recent Baystreet analysis.

“Now they’ve got prime real estate to add to their portfolio, and this is one cash crop that’s going to keep growing.”

Marijuana also enjoys a unique advantage that puts it ahead of other Canadian industries.

“There’s no province-by-province uncertainty in Canada—medical marijuana is federally legal, and in mid-April, the government is planning to put through its bill to legalize recreational use by next summer, so the urgency for investors is mounting,” the analysis explained. “Some of the biggest marijuana stocks in the U.S. have seen 1,000 percent gains over the past couple of years, and now it is Canada’s turn — where no one’s even looking.”

At present, around 130,000 individuals are prescribed with medical marijuana nationwide. The Canadian cannabis industry has been estimated by Deloitte to be worth over $22.6 billion annually—far outstripping the combined sales of all types of liquor in Canada.

Earlier this year, the country’s leading multi-tenant industrial REIT indicated that it will be adding the medical marijuana industry to its list of tenants.

“At the beginning, we shied away from it but more and more it’s becoming mainstream,” Pure Industrial Real Estate Trust CEO Kevan Gorrie said.

“We would treat them as any other tenant that would require a lot of due diligence.”

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