Article courtesy of the Telegram & Gazette

Worcester County has almost twice the number of cannabis licenses than the next highest county.

Worcester is home to the East Coast’s first private cannabis club, hosts the cannabis industry’s annual Harvest Cup, and is where the Massachusetts Cannabis Control Commission is headquartered.

And with its offerings of underused industrial space, low real estate costs, highway networks connecting New England and communities eager to increase their tax bases, Central Massachusetts has become the hub of cannabis in the state.

Meanwhile, the state — as the only eastern state that has implemented a legal, retail adult-use marijuana market — has become the epicenter of cannabis east of the Mississippi.

“We’ve created a centralized region where cannabis is thriving,” said Alex Mazin, owner of Worcester marijuana retail dispensary Bud’s Goods and Provisions.

Mazin, in a recent blogpost, called Worcester “the Cannabis Capital of the East.”

“I think communities saw (the 2016 ballot initiative approval) as an opportunity, and I think a city like Worcester — which is progressive, and has thoughtful leadership — thought it was a win-win opportunity,” Mazin continued. “Cannabis is already in Worcester, why not control it and tax it?”

“We’ve created a centralized region where cannabis is thriving,” said Alex Mazin, owner of Worcester marijuana retail dispensary Bud’s Goods and Provisions.
Francy Wade, a spokeswoman for Cultivate, one of the two dispensaries that were the first to open for recreational sales in November 2018, agreed.

“When we launched recreational marijuana two years ago, Central Mass. became a focal point of the industry east of the Mississippi: that’s something to be proud of,” Wade said. “Central Mass. is really the hub of where it started.”

But despite its growing acceptance and prevalence in the area, cannabis is still far from being a mature industry in Massachusetts.

Social consumption, or public marijuana cafés, do not appear close at hand. Diversity, while improving, is lacking in the industry, and the financial barrier to entry remains high.

The distribution of cannabis is also unequal.

Worcester has signed community host agreements with its cap of 15 recreational dispensaries, seven of which are open. In addition, another 18 marijuana businesses — everything from medical retail shops to cultivators to testing labs — have signed community host agreements with the city, according to city data.

By comparison Suffolk County, the state’s population hub, has issued only 18 licenses total for all types of marijuana businesses as of March, according to the CCC.

Moreover, the illicit market is still going strong.

“My biggest competitor isn’t another dispensary, it’s the illicit market,” said Ross Bradshaw, owner of New Dia in Worcester. “People don’t even fathom how much marijuana is being sold (on it) every day.”

Yet despite these challenges, interviews with local cannabis retailers, industry members and industry boosters reveal optimism for an industry still in its infancy. As for any nascent industry, they say there’s a lot of change to come.

“It’s the birth of an era that’s upon us,” Mazin said. “We’re still babies, still infants, and because of that, our growth is happening much more rapidly.”

Central Mass. and cannabis

The growth of the legal cannabis industry in Central Mass. — as Mazin notes, cannabis has been in the area for a long, long time — appears to have developed organically, as many of those interviewed stressed a personal connection to Central Massachusetts.

But a few factors went a long way to helping the nascent industry.

The first was political will.

“I think certain towns in Central Mass, specifically Uxbridge, have been real leaders in the state in terms of being really friendly and respectful of the cannabis industry,” said Marion McNabb, president and founder of the Cannabis Center for Excellence, a 501(c)(3) nonprofit that focuses on cannabis education, research and social justice.

She said Uxbridge has developed model community host agreements, reduced certain impact fees and really celebrated its small cannabis businesses — including Caroline’s Cannabis, the state’s first woman-owned recreational pot shop.

“These small businesses have already been opened in Central Mass. and in other parts of the state we have been noticing that these have opened and looked at them as a reference point,” McNabb continued.

Wade agreed. Cultivate operates dispensaries in Leicester and Framingham, and is about to open a dispensary in Worcester.

“In the beginning there was a lot of unknown (with recreational marijuana), but Central Mass. had an open mind and worked with Cultivate and others in this space to lay a framework for companies,” Wade said, specifically praising the community of Leicester. “Central Mass. was a community that welcomed the industry from the get-go.”

“Greater Worcester is filled with talent and treasure,” Wade continued. “And giving people good, competitive-paying jobs within a few minutes of where they live was something towns were really receptive to.”

Others praised city leaders in Fitchburg, Leominster and Worcester for being receptive to the cannabis industry – whether they intended to be particularly helpful or simply tried to exercise good governance.

“I think Worcester, becoming a hub of this, was circumstantial,” said Jacob Sanders, the chief of staff in the city manager’s office and the person who headed up the cannabis implementation process.

“The law was passed, it was 55 to 45 in Worcester in favor, and we did what the law said,” Sanders continued. “We set up a process that would allow for 15 marijuana retail licenses as available by law and in, I thought, a thoughtful way that allowed people to be treated equally, and we had 15.”

But legal and municipal amenability is only part of the equation. The geographic, physical and real-estate attributes of the region also helped.

“When looking at models and plans for our business, there was a lot more room, space for parking, (real estate) was cheaper, and we could use a warehouse as headquarters and access the entire state,” said Jensen Mejia who, along with twin brother Jackson, plans to open a marijuana delivery business in Uxbridge.

Jackson also cited the highway network surrounding Worcester.

“Central Mass. is just centrally located, it gives us a reach that I don’t think we can replicate in the western or eastern side of the state,” Jackson Mejia said.

Success built upon success

“When we first started, it was really about making sure we were demonstrating as a company what a good partner we are,” Wade said. “Massachusetts was a testing ground, and Central Mass. was a focal point for that testing ground.”

The region appears to have passed that test, as interviewees said fears about increased crime, overwhelming crowds and other negative effects have failed to materialize.

“As more of these places start to open, people realize it’s not the boogeyman,” said Kyle Moon, owner of the Summit Lounge private marijuana club.

Instead, cannabis has brought in many areas a sense of renewal.

“The fact that they’ve been able to come in and fill a lot of those vacant storefronts, filled in empty factory space, in towns and for a gateway city like Worcester, cures a lot of issues that it would otherwise have of blight,” said Joshua Lee Smith, a real estate lawyer at Bowditch and Dewey, whose practice has “snowballed” with cannabis business clients.

“A lot of money is being invested and put into these properties that otherwise would be sitting vacant for a long time…I never thought cannabis would be such a big part of that (Worcester) renaissance but it definitely is.”

Smith also praised the arrival of the CCC in town.

“It set the tone for Worcester and surrounding areas that this is the place to be if you’re in the cannabis community in Massachusetts,” he said.

Alex Guardiola, director of government affairs and public policy at the Worcester Regional Chamber of Commerce, said cannabis businesses “are becoming part of the fabric of the community.”

Guardiola cited benefits such as community service initiatives, providing medicine that may keep people from illicit drugs, the renovation and construction of buildings that bring tax revenue to the municipality, increased neighborhood security because of the businesses’ security requirements and more.

“We’re very happy to have them in the city, will partner with them in anything they need to do, and continue to advocate for them as they’ve shown to be a great industry for our city,” Guardiola said.

Central Mass. and future of cannabis

It appears that the industry also has a future in Central Massachusetts, as all those interviewed agreed that the industry still has lots of room to grow.

“I think the industry is huge and there’s enough market share for everybody — retail, delivery operators, medical, etc.” Jensen Mejia said.

Bradshaw said that the current retail environment “barely scratches the surface” of the potential market.

Meanwhile, Mazin said that “we’re nowhere near stagnation in the marketplace.”

But that doesn’t mean that the market won’t change.

Many saw change as positive.

“I think we’re at the beginning of brand evolution where the product matters, the experience matters, branding matters, packaging matters, as with any other industry,” Mazin said. “It’s starting to become a competitive market landscape. It used to be if it’s good or bad as long as it sells what’s the difference, but now that’s no longer the case.”

Interestingly, another benefit for several of those interviewed, including dispensary owners, was the potential decrease in the price of marijuana.

Jackson Mejia saw it as a benefit of competition and democratizing marijuana — possibly adding to its acceptance.

“As more owners enter the market, it will drive the price down,” Jackson Mejia said. “Hopefully it will trickle down to make legal marijuana not just a rich person’s product but make it so it is for everybody.”

Mazin and Bradshaw also saw a benefit of opening up what is now captured on the illicit market.

“If cannabis isn’t affordable, then it ultimately doesn’t convert the illicit market to the legal market,” Mazin said.

Bradshaw agreed. He referred to recreational marijuana sales figures from Colorado, which opened retail stores in 2014.

“Every single year, they are breaking a record in terms of cannabis sales on the recreational market,” Bradshaw said. “To me that’s a tell-tale sign that when prices drop and are more aligned, it can cut into the illicit market.”

Mazin also stressed lower prices would lead to more entrepreneurialism and product development, ultimately helping to diversify the industry.

“With the rise of supply meeting demand, I see more smaller entrepreneurs able to enter the space, because they can do it without needing all that capital and infrastructure,” Mazin said.

Moon agreed, saying that more “mom and pot shops” will be able to thrive in the future.

“The future, I think, is a more competitive market, more of a free market, a market less hindered by corporations with millions of dollars,” Moon said.

That’s not to say that change won’t hurt some businesses.

“Running a business requires a tremendous amount of energy, intelligence, etc.,” Mazin said. “Just because someone hands you a basketball doesn’t make you an NBA player.”

And Smith had a different opinion on the future of corporate cannabis in the state.

“There have been a lot of smaller entrepreneurs — both retailers and product manufacturers and cultivators — and a lot of larger conglomerates I think are eyeing that from other states, and looking at other operators in Mass. who have done the difficult work of going through CCC and municipalities, or even opening and, well, sometimes the money is just too good to refuse,” Smith said.

Cultivate, for instance, was recently bought by Chicago-based Cresco Labs in a deal worth $158 million.

Plus, the state hasn’t even gotten to what Moon called “the next frontier in cannabis” — social consumption.

But with the upcoming marijuana holiday of 4/20, it helps to recognize how far the industry has come.

“For the last 150 years, cannabis was criminalized; now dispensaries are normal,” Moon said. “In five to 10 years it will be just like alcohol or other leisure activities.”

Ultimately, the future appears bright for the cannabis industry. And Central Massachusetts has a good start in capturing it.

“The cannabis community is here to stay and it’s something to embrace,” Wade said. “It’s bringing in jobs, bringing in revenue, helping businesses…4/20 this year is a day to sort of mark how far we’ve come as a professional industry, and really that happened in Central Massachusetts.

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