Colorado's move to legalize pot has had some unintended consequences for area businesses. According to a report on American Public Media's "Marketplace" radio show, demand for warehouse space by recreational marijuana dispensaries is driving Denver-area rental rates through the roof.
Since January, when Colorado became the first state to legalize recreational pot, dispensary operators have been on the hunt for warehouse space—not just to store their inventory but also to grow it. Under the law, dispensaries are required to grow their own supply.
One Denver-area dispensary owner told "Marketplace" he is paying $20 per square foot, four times the average national rate for comparable space. He alleged that some landlords also ask for a share of a dispensary's profits.
Dispensaries need certain types of facilities with the right zoning, location, and electric power supply. But, local real estate experts told "Marketplace," sudden demand is beginning to affect other categories, and Denver is starting to see a tight market and rising rents for all kinds of warehouses.