Cannapany on August 24, 2022 No Comments
The cannabis company has signed a new deal to lease property from Zephyr
The packaged cannabis products company focused on implementing one of the strongest brand portfolios, RIV Capital, announced that it has signed a lease agreement with Zephyr, a leading California-based developer. The idea of the new agreement is to develop and operate a new flagship cannabis cultivation and manufacturing facility planned for Buffalo, New York. The terms of the agreement call for RIV Capital to subsequently sublease the flagship facility to Entain once the required regulatory approvals receive the green light.
The lease agreement indicates that Zephyr will lease and develop two buildings totaling approximately 75,000 square feet to RIV Capital. $30 million is expected to be the amount of the total development costs of the project. $4.5 million of that money will remain the responsibility of RIV Capital. In addition, it has been clarified that RIV Capital will pay base rent to the Landlord over the term of the lease based on a favorable capitalization rate applied to the developer’s share of the project costs.
Initially, it has been indicated that 15 years will be the term of the lease. Both Etain and RIV Capital have the ability to expand the leased facilities if they see the need to include additional buildings for additional production and growing space.
Under the terms of the lease, there are also some conditions attached to the receipt of regulatory and other necessary approvals. Of particular note is the completion of any environmental remediation in accordance with the New York State Brownfield Program.
Once regulatory approvals are approved, Etain will gain access to a state-of-the-art cannabis cultivation and manufacturing facility. Both firms will best leverage this to increase Etain’s breadth, diversity, and volume, as well as provide a platform to bring authentic and successful cannabis brands to New York.
Congratulation!