PurePenn CEO Gabe Perlow says construction of the group’s 21,000-square-foot medical marijuana facility on a former McKeesport mill site was going smoothly this fall — that is, until they started excavating 6 feet of ground for the foundation.
“Below 3 feet, we started hitting solid concrete,” he said earlier this week. They also ran into buried steel railroad tracks and tunnels, which then needed to be collapsed and filled in.
Meanwhile, Corinne Ogrodnik, CEO of Maitri Medicinals, said the plans to build a medical marijuana dispensary inside Pittsburgh city limits hit a snag when the south Oakland structure they’d chosen turned out to need extensive renovation. They then selected another site and reached an agreement with the landlord — only to have the mortgage-holding bank nix the deal two to three weeks later.
“There are so many things that are out of our control,” Ms. Ogrodnik said.
For his part, Sam Britz, chief operating officer for the Solevo Wellness dispensary on Forward Avenue in Squirrel Hill, said renovation of the old Buncher Co. headquarters off the Parkway East is on track. But that project has hit the occasional speed bump, too, such as having to trash pamphlets printed for the “medical cannabis” facility. State health officials said it must be called “medical marijuana.”
“They want their hands on it and they want to see everything,” he said of the state’s oversight. “That’s good. It puts the standard really high. But it makes it hard to start up a new business.”
With the doors for Pennsylvania’s medical marijuana program about to open for consumers, the 12 groups who plan to grow and the 27 who will sell the medical marijuana pills, oils and topicals — plants and edibles are not allowed — are racing to meet the state’s deadlines for becoming operational.
Both of this region’s grow facilities, PurePenn and AgriMed in Greene County, appear on track to begin cultivating early next year.
Mr. Britz said the Solevo Wellness dispensary expects to be open in the spring, once the growers can send product, while Maitri Medicinals has received an extension while it makes a third try for a dispensary location, most likely in Pittsburgh’s East End neighborhood.
Getting there hasn’t always been easy.
By now, zoning and building permits have been taken care of, but there’s still construction or renovation projects to complete, people to hire and a hundred other details to take care of.
“I think we’re so embedded in the business development that we have to make a concerted effort to remind ourselves that this kind of sprint-marathon will let up once we open our doors,” said Ms. Ogrodnik, who runs Maitri with husband and COO Joseph Vesely.
“Winning the permit was hard,” Mr. Britz said. “But it’s just as hard, if not harder, to get started.”
The banking problem
What makes starting a medical marijuana business different from your standard startup is that it’s done in the shadow of federal law that says marijuana in any form is illegal, regardless of what the state legislature says.
For starters, that makes finding a federally regulated bank that’s willing to offer financing difficult. It also means that properties where banks hold the mortgage will likely be off limits, that the IRS tax codes won’t allow owners to deduct their expenses, and that dispensaries will have to operate on a cash-only basis.
“We can’t even put in a 401(k) plan” for employees, lamented Mr. Britz.
Ms. Ogrodnik noted that, after Maitri Medicinals won unanimous approval to open a second dispensary in downtown Uniontown, the owners found out they needed a second, “special” title search because it’s a medical marijuana business — another unanticipated development they’re taking in stride.
“If you let adversity and obstacles get you down, you’re not going to be able to push through and make it.”
Nice place for new product
In a few months, drivers taking the outbound Parkway East exit at Squirrel Hill will see the finished 7,000-square-foot Solevo Wellness dispensary, renamed from its original Keystone Relief Centers moniker. It will be the most visible sign that medical marijuana is now open for business here.
Mr. Britz, with architects Chad Chalmers and Paul Bahm of Studio WC LLC in Troy Hill, walked across the still-unpaved parking area earlier this week and into the building, still a shell, where a worker used an excavator to dig where the facility’s bathrooms will be. The roof, air conditioning and plumbing will all be new, they said.
Studio WC plans to cover the exterior brick with a cumaru wood material and the plan for the interior, Mr. Chalmers said, is a warm finish “so the waiting room would be less clinical and more comfortable.”
With extensive landscaping plans and an adjacent bike path, this previously empty lot “is going to be a really nice site,” said Mr. Britz, who is a certified public accountant.
When finished, he added, the building will be “a cross between a pharmacy, a doctor’s office and a jewelry store,” where the different products will be displayed in cases much like you would see in a jewelry store.
In all, he estimates, the company will put more than $1 million into the building before the first patient walks through the door.
“People think if you’ve got a medical marijuana permit, you’re just printing money,” Mr. Britz said. “That is absolutely not the case.”
Original post from Pittsburgh Post-Gazette