By TED CARTER
ARCADIA — DeSoto County is making a timely entry into a Florida medical marijuana market that has gained huge consumer popularity since the spring arrival of smokable flower.
Columbia Care Services Florida LLC has found local partners with land on which to expand the company’s current grow operations by a third, with 23,000 square feet of greenhouse space and 21,249 square feet of warehouse area in a first phase.
A second phase puts 53,760 square feet of greenhouse space into operation along U.S. Highway 17 just outside Arcadia city limits. The growers could find themselves expanding even further in order to reach their ambitious plan of 50 dispensary locations around the state.
The two properties, located on the east side of the highway, total 10.8 acres. Formerly zoned for general commercial, they now carry a light industrial designation.
Rodney Hollingsworth and his uncle Thomas Hollingsworth own 4.59 of the acres and have created R&T Land Holdings LLC for their partnership with the 7-year-old Columbia. The remaining acres are owned by DeSoto Storage Center based in Rensselaer, Ind.
DeSoto County commissioners approved a development plan for R&T Land Holdings in early June. Plans are to modify the development plan to include the DeSoto Storage Center property.
The $1.3 billion Columbia came to Arcadia as a partner with Better-Gro, the original license-holder located in Arcadia. The process they established enables “us to produce some of the highest quality products available anywhere in the country right in Arcadia,” Columbia CEO Nicholas Vita said in a recent email.
“Arcadia will continue to play a critical role in our expansion across Florida,” Vita added.
Vita said he expects worker levels will reach about a dozen by summer, along with nine corporate managers.
Financial backing for the footprint Columbia intends to make on Florida’s medical marijuana market comes from an April initial public offering on Canada’s Aequitas NEO Exchange. That brought a market capitalization of $179 million, according to an earnings call with investors and analysts.
The IPO funds a core strategy Columbia boasts will “lead the development of the global cannabis industry,” Vita said in a first quarter earnings call with investors and analysts.
Vita disclosed the 50 dispensaries number during the call. To get there, Columbia Care will have to wait until April 2020 when the cap of 35 locations expires or get a waiver on the cap legislators put in place in 2017 after Florida voters the year before overwhelmingly passed a constitutional amendment that broadly legalized medical marijuana.
The state recently granted waivers to medical cannabis producers Surterra and Trulieve.
The News Service of Florida reports that as of early June, Florida had 224,815 active registered medical-marijuana users served by 22 licensed businesses.
The state’s dispensary numbers are constantly increasing. In early June, Florida had 126 marijuana dispensaries.
Even without the smokable marijuana, the Florida industry was expected to surpass revenue of $1 billion by the end of 2020.
Vita told analysts that staying on the sidelines has allowed time for markets to open up and for Columbia and others in the medical cannabis sector to reach a “comfort level” with decision makers in Florida localities. “We’re very enthusiastic about it because it’s growing very fast,” Vita said of demand in Florida for medical cannabis products.
Referring to DeSoto County, Vita said, “We have found a very good labor force that will help us through the manufacturing and production process.”
Columbia Services will be ramping up in Florida through the rest of the year, according to Vita. “Patients have great expectations. We want to work out any bugs before expanding.”
The Arcadia operation recently received the British Standards Institution’s Good Manufacturing certificate, which is based on Florida Department of Health requirements for processing extraction and production of medical cannabis.
Vita indicated on the earnings call Columbia may not hit the very top of the Florida market but the company will be part of a very short roll call of market leaders. In some markets, it is best to be second rather the first, he said.
“Florida is one of those markets.”