Cannabis dispensaries growing on QC communities

Moline officially has gone to pot with the recent grand opening of Terrace Cannabis Dispensary on Avenue of the Cities and a second dispensary in the works off John Deere Road by a different developer. But that city isn’t the only one of its neighbors whose development leaders are high on the idea of locating […]

Moline officially has gone to pot with the recent grand opening of Terrace Cannabis Dispensary on Avenue of the Cities and a second dispensary in the works off John Deere Road by a different developer. But that city isn’t the only one of its neighbors whose development leaders are high on the idea of locating a recreational cannabis business within their borders to reap the benefits, they say, legalized recreational marijuana can bring. That’s especially true in the Illinois Quad Cities across the river from Iowa where recreational marijuana has not been legalized. Take Miles Brainard, the City of Rock Island’s community and economic development director.

“I think it’s only a matter of time before a developer picks Rock Island for their cannabis business,” he told the QCBJ in an interview a few days after Terrace quietly opened its Moline doors.  And when an interested developer comes calling, Mr. Brainard knows where to direct them. It’s a tract of what appears to be buildable land across from Bally’s Casino Rock Island on Illinois Route 92. That parcel, which boasts a frontage road, is part of a collection of 23 parcels of mostly wetlands that the city bought for a dollar from Riverstone Group last year. In the past, city planners had called the land in question Casino West. It’s a name Mr. Brainard and the city’s other modern-day urban planners also have adopted. And he wants there to be no confusion about what he’d like to see rising up there.  “For anyone who is listening, I want a cannabis dispensary on Casino West,” he said. “I want one right across from that casino. I want several things across from that casino because it doesn’t just have to be a dispensary.” (Other co-locators could include, for example, a convenience store or strip mall.) Mr. Brainard’s dispensary declaration is hardly surprising since locating new thriving recreational cannabis facilities in Rock Island has been part of the city’s development plan. And the product itself is nothing new to the city. It is home to Green Thumb Industries (GTI), a growing cultivation facility on Andalusia Road in southwest Rock Island. GTI opened originally just for medical cannabis and expanded to recreational cannabis sales when it became legal. “We’ve got a grower already, it’s just a dispensary that we’re lacking,” Mr. Brainard said. That’s no longer a problem for Moline, which held a grand opening celebration on Friday, July 31, that featured a speech by Moline Mayor Sangeetha Rayapati.

Terrace open for business

Moline’s mayor welcomed the new business to the Avenue of the Cities corridor, noting how it is breathing new life into what had been a vacant grocery store for some time. “There is a lot of positive momentum in Moline right now, and you are part of that,” she said. Terrace Cannabis assistant general manager Colton Riley also thanked city staff for helping the store navigate pre-construction issues and for working with contractor Estes Construction. “We got into the cannabis industry as a way to help people, and that’s what we plan on doing here,” he said. Moline officials expect sales tax revenue from cannabis sales to create between $300,000 and $500,000 annually.

For parent company Terrace Cannabis, which is owned by an all-Illinois group of investors, the new shop is another step in its efforts to achieve some ambitious goals. “We are a cannabis collective and our motto is Bringing Cannabis to New Heights,” said Shannon Duncan, Terrace’s director of retail operations. The United Township High School graduate and Quad Cities resident also told a QCBJ reporter during Terrace’s July 21 soft opening: “We are acquiring as many dispensary licenses across the state of Illinois that we can to grow our brand and hopefully make it nationwide at some point.”  The new Terrace dispensary also represents a milestone for the City of Moline, which had previously OK’d a different company’s plans on the former Aldi store site. The first cannabis dispensary the city approved was to be developed on the property owned by Dan Dolan by Deeprootz LLC. That group pulled out last spring and Moline sought another licensee. Terrace Cannabis took up the challenge and built the city‘s first dispensary. “We got official approval in Moline to start construction in 2022, and that’s kind of around the time that we picked this location,” Ms. Duncan said. The buildout began in late 2022.  “We are creating an environment that our staff loves to come to. We want it to be a fun place for them to be and then, in turn, create a positive experience for customers as well,” she added. Coming soon will be a large sign to replace the nondescript one that currently hangs above the door. It’s on order, Ms. Duncan said. In all, Moline has approved four zoning areas suitable for cannabis dispensary development. And a second dispensary is already taking shape. In March, the city council agreed to award a license to Bolden Investments I, LLC, to establish and operate a cannabis dispensary in the former West Music building at 4301 44th Ave.

Numbers could multiply

Those future dispensaries would join a growing group that includes the very first dispensary in the metro Quad Cities, which is located in Milan. Nature’s Treatment of Illinois (NTI) originally opened at 973 Tech Drive as a medical marijuana dispensary. When Illinois legalized recreational marijuana and began licensing dispensaries, NTI began selling its recreational cannabis products. And elsewhere in the Illinois Quad Cities, a handful of community leaders report seeing interest from developers or remain open to talking to cannabis dispensary operators who might come calling. Moline’s sister city to the east, for example, has seen occasional developer traffic, according to East Moline City Administrator Doug Maxeiner. “East Moline worked with a group looking to locate a dispensary in East Moline approximately three years ago,” he told the QCBJ. “The application was not successful as of yet. We receive many inquiries about submitting an application, but no one else has followed through after finding out about the regulations and complexity of submitting an application.” In Henry County, the City of Kewanee had worked with the Elevated Supply Company a few years ago to locate a dispensary there, but so far no project has been announced. The lack of dispensaries licenses being approved and businesses opened is tied to several things, Mr. Brainard said.  “Dispensaries have been slow to come due to the holdup of the pandemic,” he said of COVID-19.  In addition, he said, “It’s really difficult to get into this business. These are not small-time operators or mom-and-pop shop kinds of things. They are really ventures that require almost a corporate level of investment and a lot of the companies that you hear about – they’re usually already established in other states –have a network and an approach.”

Barriers remain a challenge

And even if someone is fortunate to receive a provisional license, Mr. Brainard added, there are still huge hoops to jump through and complex financing issues to navigate. Consider, for example, that federally-insured lenders cannot loan money to cannabis businesses because recreational cannabis remains illegal at the federal level. Those complex federal and state steps are one of the reasons that his city did not adopt additional stringent restrictions for dispensaries beyond this one: They cannot be located within 100 feet from a residential property. Mr. Brainard also said that from the beginning, Rock Island‘s “approach to cannabis was that we wanted to be very open to the business. We wanted to be friendly to it and we wanted there to be a very loose barrier to entry. “In addition, the city has identified four potential areas that could welcome a dispensary. Since recreational pot became legal, he added, “We have periodically had a site selector or developer with clients interested in doing business here contact us for information. Nothing has ever really moved past that sort of conversation where they just wanted to understand what the barrier to local entry was.” He remains hopeful that will change as the State of Illinois continues to work to speed up its licensing process. “I think that it’s been unusually slow in a way because of the pandemic and the way that licensing issues got gummed up,” he said. “If not for the pandemic, we would have a dispensary already.” Location, at least in the case of recreational cannabis, also is critical, Mr. Brainard said. “We’re positioned right across from Iowa, we’ve got a good site right across from the casino in the southwest which would be a good co-locating opportunity,” he said.