Capital for Buying, Upgrading Legal Marijuana Business Property Increases

More capital is flowing into the purchasing and upgrade of property tied to fledgling marijuana businesses in states where it has been legalized, according to statistics from Viridian Capital Advisors, an investment bank that specializes in the pot trade.

Last year businesses that focused on growing or dispensing marijuana raised about $475 million, according to the Viridian Cannabis Deal Tracker. This year the figure has already hit $225 million, the firm said.

Those businesses are using most of that money either to buy or upgrade indoor and outdoor farms and stores, Viridian executives said.

"You can't get a license to grow or sell unless you've already identified as part of the application property that is legally zoned," said Scott Greiper, Veridian's founder and president.

Mr. Greiper noted 29 states have legalized marijuana for recreational or medicinal use. "There's now a rush among real-estate investors to acquire these legally built facilities," he said.

Late last year, Innovative Industrial Properties Inc., a company that owns properties used for growing medical-use marijuana, raised $61.1 million in an initial public offering. Innovative Industrial leases the properties to operators.

Write to Peter Grant at peter.grant@wsj.com

(END) Dow Jones Newswires

May 02, 2017 19:28 ET (23:28 GMT)