Cannabis REITs are growing like weeds amid an uncertain regulatory landscape.
Several cannabis execs talked about the advantages of the REIT structure Wednesday at Benzinga's Cannabis Capital Conference in Chicago.
What To Know: REITs, or Real Estate Investment Trusts, often raise money from outside sources and use those funds to buy and sell income-generating properties. The cannabis industry faces an uphill regulatory battle, and more and more companies are exploring different ways to raise capital.
"Cannabis itself is a very capital intensive asset. To grow quality cannabis you have to build a greenhouse or an indoor facility and that costs a lot of money," said Travis Goad, managing partner at Pelorus Equity Group.
With the cannabis industry still in its early stages, real estate is typically a cannabis company's number one asset, Goad said.
"These REIT structures allow us to pull capital from investors and, specifically for us in a mortgage REIT, make a first lien senior secured loan to help fund the growth of the industry," …