By all measures, the opening of the cannabis market in Massachusetts has been an overwhelming success. Since November of last year, the state has tallied over $24 million in total cannabis sales. The rollout has been managed by the state’s Cannabis Control Commission and the state has worked to pass fair regulations that both protect consumers and create a level playing field.
Already, however, Massachusetts faces skyrocketing demand and there is simply not enough supply. A supply crunch could drive customers back to the so-called gray market, the Chelsea Police Chief recently told the Boston Herald.
The company plans to produce this higher quality cannabis in their 345,000 square foot Massachusetts Cannabis Manufacturing and Cultivation Project in Freetown. The building sits on 52 acres of land and will house state-of-the-art greenhouses that the company believes will be an epicenter for high-quality and eco-friendly cannabis. Building 1 of the project, a 30,000 square foot cultivation facility, is scheduled to be complete this summer and the greenhouse should be completed this month.
The Development of ACAN’s Flagship MCC
“The topping off of Building 1 represents an important milestone for AmeriCann,” stated ACAN Founder Ben Barton.”Although Building 1 is only the initial phase of the overall MMCC development, it is on schedule to provide AmeriCann with significant revenue and cash flow.”
Now, as stated above, ACAN believes their Cannopy system, which according to their 10-K has been developed with expert horticulturalists and can produce low-cost, high-quality cannabis. Here is an excerpt from the release:
AmeriCann developed Cannopy with experts from traditional horticulture, lean manufacturing, regulatory compliance and cannabis cultivation. Cannopy includes automation throughout the production life-cycle, customized workflow processes, monitoring and controls, and top-line security systems.
A little further down in the 10-K, there is also a paragraph on the company’s expansion to other states, which the company is next looking to do in Illinois:
Once fully developed, the MMCC design calls for a research facility, a training center, corporate offices, a quality-assurance laboratory, and a facility for manufacturing cannabis-infused food, nutraceuticals and consumer packaged cannabis goods. We intend to open similar facilities in states in which cannabis is legal for medical and adult use.
In Massachusetts, ACAN currently has proposed one tenant, Bask, Inc.. According to press, Bask plans on using the Medical Cannabis Center to grow their product lines and expand their Fairhaven cultivation center.
“We have been developing our expansion plans with the support of AmeriCann and the innovation and scale of the Massachusetts Medical Cannabis Center will position our companies for tremendous growth,” said Chapman Dickerson, CEO of BASK.
However, in the 10-K, ACAN alludes to an additional amount of capital needed to finalize the terms of the contract with Bask. And, this is one area of concern for potential investors in ACAN is the dilution of the stock. The entrance to the Massachusets market is exciting as there is boundless potential in this well regulated state, but the company needs to do right by shareholders and solidify the balance sheet. It is possible that this year might be the turning point for ACAN.