PharmaCann is preparing to close its cultivation site in Dwight, south of Chicago, with 82 employees set to lose their jobs. The move, expected to be completed by the end of the year, was disclosed in a filing with state authorities, as reported by Crain's Chicago Business.
The closure marks another sign of pressure building in the United States cannabis market. According to Crain's, conditions have become increasingly difficult as wholesale prices fall, competition grows, and companies face rising borrowing costs with no federal relief in sight. Investor patience has thinned as hopes for better tax or banking rules continue to fade.
PharmaCann was one of the early Illinois license holders and expanded across several states, though it never entered the public markets. The company has also spent nearly a year in default on leases connected to multiple retail and cultivation properties owned by Innovative Industrial Properties, Crain's reported. The Maryland based real estate trust has taken legal action to regain control of several sites, including the Dwight facility.
Whether the Dwight license or site will change hands remains uncertain. The Illinois Department of Agriculture told Crain's it has not received any request for a sale or transfer. These large scale licenses were once among the most sought after in the state due to their significantly higher production limits.
Speaking to Crain's, attorney Ryan Holz noted that the Dwight situation is not isolated and could signal more turbulence ahead for other large grow operators.
