Power REIT has put most of its commercial cannabis and other agricultural greenhouses up for sale at a time of declining prices and sales in parts of the cannabis industry.
The real estate investment trust that also owns land leased to solar farms is warning about its financial health. The Old Bethpage, New York-based REIT said in a Securities and Exchange Commission filing that substantial doubt exists over its ability to continue as a going concern, citing liabilities far exceeding assets, net losses, expected reduced revenue, and increased expenses related to its greenhouse portfolio.
In Colorado, where the company owns most of its greenhouses, the industry has suffered lower demand. Colorado marijuana prices and sales dropped rapidly in the latter half of 2022 and all of 2023 after record-breaking sales during the COVID-19 pandemic, according to the Colorado Department of Revenue. Sales dropped to $1.53 billion last year from $1.77 billion in 2022 and $2.23 billion in 2021.
Power REIT reported revenue last year fell to $2.34 million from $8.52 million the year before. The REIT reported a loss of $6.78 million for 2023 after a profit of $1.83 million in 2022. Conditions in the state imploded, David Lesser, CEO of Power REIT, said in an interview with CoStar News. About half of its total greenhouse operations serve the cannabis industry.
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