MedMen Enterprises said Oct. 18 that it agreed to sell a chunk of its real estate assets to Treehouse Real Estate Investment Trust for about $12.5 million. The three properties included in the deal are MedMen Abbot Kinney, MedMen Beverly Hills and Men Downtown Las Vegas. Treehouse is backed by New England Development, Samuels & Associates and Visconsi Cos in partnership with Stable Road Capital.
LOS ANGELES–(BUSINESS WIRE)–MedMen Enterprises Inc. (“MedMen” or the “Company”) (CSE: MMEN) (OTCQB: MMNFF) (FSE: A2JM6N) today announced that it has reached agreement to sell a significant portion of its real estate assets to the newly formed Treehouse Real Estate Investment Trust (“Treehouse”). Treehouse is a real estate investment vehicle that capitalizes on the cannabis industry’s continued growth; initial investors include real estate firms New England Development, Samuels & Associates and Visconsi Companies, in partnership with Stable Road Capital.
The initial transaction includes three properties and is expected to generate approximately $12.5 million of proceeds to the Company after repayment of debt. Additional real estate assets in MedMen’s portfolio are expected to be sold to Treehouse over the next 12 months. The properties sold to Treehouse will be leased backed to MedMen or its subsidiaries at market rates under long-term leases.
“MedMen owns and controls some of the best real estate in today’s burgeoning cannabis industry and they will serve as an important seed portfolio for Treehouse,” said Brian Kabot, chief investment officer of Stable Road. “Given the investor interest in the sector, this vehicle made a lot of sense. More importantly, this creates liquidity and creates an efficient form of off-balance sheet financing to foster further growth for MedMen and others in the industry who wish to grow.”
“Thoughtful property owners across the country have begun to consider the role that cannabis retailers play in their overall leasing strategy, putting Treehouse at the vanguard of an emerging business opportunity,” commented Scott Baker of New England Development. “Many cannabis operators own prime parcels in highly sought after communities, offering a variety of opportunities for return on investment and future development.”
The three initial properties included in the transaction are:
• MedMen Abbot Kinney – the only cannabis store in what GQ calls the “Coolest Block in America,” 1308-1312 Abbot Kinney Blvd., Venice, California.
• MedMen Beverly Hills – the store is in a bustling shopping district adjacent to the city of Beverly Hills, 106-110 S. Robertson Blvd., Los Angeles, California.
• MedMen Downtown Las Vegas – the Company’s first branded store in Las Vegas in the heart of the city’s Arts District and near the Fremont Street Experience, 823 S. 3rd Street, Las Vegas, Nevada.
MedMen Enterprises is a leading cannabis company in the U.S. with assets and operations across the country. Based in Los Angeles, MedMen brings expertise and capital to the cannabis industry and is one of the nation’s largest financial supporters of progressive marijuana laws. Visit http://www.medmen.com
ABOUT NEW ENGLAND DEVELOPMENT:
For over forty years, New England Development has taken a creative, entrepreneurial approach to real estate development and management – delivering and sustaining successful projects across a wide range of property types. These projects transform complex challenges into preferred locations, generate long-term value to communities, afford compelling opportunities for local and national businesses, and offer sought-after experiences to a wide range of consumers. The company is acclaimed for creating some of the country’s most widely-recognized and successful regional centers, as well as multifaceted developments that combine retail, residential, hotel, and office uses. Outlet centers, high-end and street-front retail, airport retail, golf courses, restaurants, and marinas round out New England Development’s robust portfolio. Visit http://nedevelopment.com/
ABOUT SAMUELS & ASSOCIATES:
Samuels & Associates, headquartered in Boston, MA, has been building communities for more than two decades. Pioneers in development, leasing and merchandising, and property management, the Samuels & Associates team specializes in creating mixed-use development projects with active pedestrian spaces, flexible and inspiring commercial spaces, and dynamic combinations of retailers and restaurateurs. Samuels & Associates is guided by the belief that people should live, work, shop and play in dynamic communities that inspire and enrich all aspects of their lives.
ABOUT STABLE ROAD CAPITAL:
Stable Road Capital is a family office employing an opportunistic approach to fundamental value investing. The Firm focuses on acquiring and investing in high quality operating businesses, assets and funds. While the Firm is generally industry agnostic, Stable Road Capital has dedicated considerable resources to advising and investing in the cannabis sector, focusing on large vertically integrated players, individual brands, and industry specific private equity funds. Visit https://www.stableroadcapital.com/
ABOUT VISCONSI COMPANIES LTD:
Visconsi Companies, Ltd., is a fourth generation, family-owned developer and manager of retail and other properties and a provider of real estate advisory services. The company’s activities span coast-to-coast including a property portfolio of two million square feet; many completed, in-progress and planned developments; plus prime land holdings. We continue to expand into new markets, developing innovative shopping centers, single tenant net lease programs, healthcare facilities and other real estate ventures.
SOURCE: MedMen Enterprises
Cautionary Note Regarding Forward-Looking Information and Statements
This press release contains certain “forward-looking information” within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only MedMen’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of MedMen’s control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, estimates”, “forecasts”, “intends”,“anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or may contain statements that certain actions, events or results “may”, “could”,“would”, “might” or “will be taken”, “will continue”, “will occur” or “will be achieved”. The forward-looking information and forward-looking statements contained herein may include, but is not limited to, information concerning the proposed sale and leaseback of certain MedMen properties, including the contemplated timing and terms thereof and the contemplated impact of the same on the financial position of MedMen.
By identifying such information and statements in this manner, MedMen is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of MedMen to be materially different from those expressed or implied by such information and statements. In addition, in connection with the forward-looking information and forward-looking statements contained in this press release, MedMen has made certain assumptions.
Among others, the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: inability to locate suitable acquisition targets; adverse changes in the public perception of cannabis; changes in consumer demand for cannabis; decreases in the prevailing prices for cannabis and cannabis products in the markets in which the Company operates; adverse changes in applicable laws; adverse changes in the application or enforcement of current laws, including those related to taxation; increasing costs of compliance with extensive government regulation; changes in general economic, business and political conditions, including changes in the financial markets; risks related to licensing, including the ability to obtain the requisite licenses or renew existing licenses for the Company’s operations; dependence upon third party service providers, skilled labor and other key inputs; risks inherent in the agricultural and retail business; intellectual property risks; risks related to litigation; dependence upon senior management; and the other risks disclosed in the Company’s public filings. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.
Although MedMen believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements.
Key assumptions used herein are that the proposed sale and leaseback of the applicable MedMen properties will be completed, including on the current terms and anticipated timing. The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and MedMen does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to MedMen or persons acting on its behalf is expressly qualified in its entirety by this notice.