Recent marijuana ordinances driving up commercial real estate prices in Monterey County
The City of Salinas is the latest Monterey County city to pass an ordinance on how marijuana can be grown and sold.
The new guidelines are affecting industrial real estate prices in parts of the county.
The Cities of Greenfield and King City in Southern Monterey County recently approved an ordinance that allows for the cultivation of marijuana in industrial zones, subject to permitting and licensing.
Aaron Johnson is a local attorney representing cannabis businesses and said within the past several months, things have really changed in the area.
“Once they actually adopted their ordinance, and put their application online, word spread rapidly throughout California basically, that Greenfield and King City were kind of open for business,” said Johnson.
He said, when landowners heard about marijuana cultivators bidding on industrial spaces, several more put their property on the market, but demanded more in price.
“What we saw literally in a matter of two weeks was the price go from about $50,000 an acre, up to $400,000 an acre," said Johnson.
He said those prices will eventually balance out as more permitting is allowed in other areas.
Right now, Salinas allows fewer permits than King City and Greenfield, so you’re not seeing the flood of buyers.
Johnson said local politicians are seeing the value of medical marijuana, "but they're also acknowledging the need to provide it to the areas like the Bay Area and LA and San Diego markets, where they have a lot of people, but not necessarily the best places to cultivate.”
In November, Californians will vote on The Adult Use of Marijuana Act which would allow for the recreational use of marijuana throughout the state. Speculation on this proposition could further drive up prices.