If you have been studying the cannabis real estate business, you will understand that the business became very popular in a short time, and it is a very lucrative business.
The cannabis business is a fast-growing business around the world now that needs a large sum of capital to start up. Although not all countries consider it legal. In fact in the United States of America, not all states consider it legal.
In this article, you will be reading about factors that make investing in cannabis real estate profitable and how 420property supports investors. The advantage of investing in cannabis real estate investment trusts includes the following but are not limited to the following:
For you to invest in cannabis real estate, it requires a significant commitment, (it is more like the investor has to put all his/her eggs in one basket) because of this as an investor, you can only invest in a few places. Which makes these investors exposed to the risks and return of micro-markets. It is believed by many that the cannabis real estate business is a very risky proposition.
However, cannabis real estate investment trust provides you with the opportunity to diversify risk, and with the help of 420property, you can always win when it comes to cannabis real estate investment. This is possible because this trust has a lot of property around the world, ranging from condos, offices, apartments, and so on. Having these properties all around the world and in different aspects of business allows you to diversify, hence protecting yourself from any form of risk.
2. Ability To Predict The Outcome Of Your Investment.
You can predict what happens to your investment with the help of cannabis real estate trusts, unlike other investments. You can easily predict the rate of appreciation in real estate as an asset class. Hence, they predict the cash flow accurately.
The cannabis real estate trusts provide you as an investor with a lot of choices. They have various types of trust that suit all types of investors. There is some trust that invests strictly in equity, which means they only buy the properties and then gain from the cash flow as well from the capital appreciation. Return on this type of investment is mainly dependent on present market value.
Cannabis Sales Record In The Year 2021.
During the pandemic, contrary to general opinion the sale of cannabis increased. Cannabis sales in the year 2021 was recorded as $30 billion, which is an $11 billion increase compared to the year 2020. The increase in sales could be related to more state-approved cannabis as a recreational substance as well as medical marijuana. According to research, the use of drugs and alcohol increased greatly during the pandemic. The sales of cannabis was estimated to be $37 billion in 2022, which could increase to $100 billion by 2026.
Cannabis is considered legal in 19 states in the United States, Kansas, South Carolina, North Carolina as well as Mississippi could legalize cannabis soon, which gives cannabis businesses more room to grow. New York is one of the states in the United States that cannabis businesses have had the opportunity to greatly expand in. New York is predicted to be one of the largest markets of cannabis use by adults.
There are now real estate investment trusts that now specialize in medical marijuana, they have a market capitalization of $583 million as well as 28 properties under their management, this means the company is still a small company intending to grow larger.
In the case whereby these new states don’t approve of medical marijuana, the cannabis business still has a lot of room to grow. Because cannabis is not considered legal at the federal government level, a lot of banks are unable to give cannabis businesses loans to improve the cannabis real estate, so this means cannabis businesses are mainly relying on lenders as well as the cannabis real east investment trusts.
According to research based on the situation the world is with the pandemic, we have reasons to believe that the cannabis real estate market is going to have a great profit increase in the year 2022 because there will be more room for cannabis businesses to grow and expand as well.