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Gov. Kathy Hochul’s office announced this morning that the $200 million fund meant to provide resources for Conditional Adult-Use Retail Dispensary operators is fully banked after asset management firm Chicago Atlantic invested $150 million.
The state’s 2023 budget included $50 million toward the Cannabis Social Equity Investment Fund, so Chicago Atlantic’s investment covers the entirety of the private money needed to be raised.
“Today’s announcement reinforces New York’s commitment to building partnerships that benefit New Yorkers and setting right the wrongs of the past,” Gov. Hochul said in a statement.
The Hochul administration announced the social equity fund in early 2022, and later placed it under the auspices of the Dormitory Authority of the State of New York. DASNY’s role is to provide support for CAURD operators “with its leasing and construction services to site dispensaries at prime locations and renovate them to meet health, safety, and security requirements.”
After posting an RFP for a team to manage the fund and raise the additional $150 million through private investments, last June DASNY awarded the contract to Social Equity Impact Ventures, a joint partnership between Webber Willis Ventures LLC, led by basketball Hall of Famer Chris Webber and his business partner entrepreneur Lavetta Willis; and a firm affiliated with Siebert Williams Shank.
Details of the fund, its managers and progress in raising private capital have raised eyebrows among cannabis industry stakeholders in New York for the past year.
In November, NY Cannabis Insider reported about possible conflicts of interest for Webber and Willis, who have significant business ties to global cannabis and apparel company Cookies.
In December, NY Cannabis Insider reported on Webber and Willis’ history of over-promising and under-delivering when it comes to cannabis industry investment projects.
With the social equity fund fully financed, DASNY plans on completing buildouts and redesigns for storefronts that they will provide to some CAURD licensees as part of a loan program.
The Cannabis Control Board in March doubled the size of the CAURD program, increasing the maximum number of dispensaries to 300. Under the expanded program, the first 150 businesses to receive CAURD licenses will be guaranteed a DASNY space if they need one.
That’s not necessarily the case for the second cohort of 150, but each business from the first group that declines a DASNY space means a greater chance of availability for entrepreneurs in the second group.
In the statement announcing Chicago Atlantic’s investment, Office of Cannabis Management Executive Director Chris Alexander thanked the firm, and said the funds will help move the state’s legal weed market forward.
“This infusion of capital will provide necessary support to licensees and will help New York further its work of establishing an inclusive cannabis market that creates opportunities for entrepreneurs harmed by prohibition and locked out of markets in other states,” Alexander said.