Voters Speak Up Loud And Clear: They Want Recreational Cannabis

It’s been a banner year for cannabis operators across the state, and on Tuesday, a majority of voters in six Chicago suburbs endorsed bringing recreational cannabis sales to their towns.

Many suburbs resisted allowing such operations after the state legalized the sale and use of recreational weed beginning in January. But the successful referendums in Wilmette, Mount Prospect, Batavia, Glen Ellyn, Elk Grove Village and Park Ridge are another sign that recreational cannabis is becoming more welcome across the region and is being increasingly seen as an economic development tool. Voters in Western Springs were the only ones to shoot down a cannabis proposal.   

“The public acceptance of the cannabis industry on the municipal level is increasing,” according to Barbara Webb, director of MGO, a national accounting and advisory firm that just opened a Chicago office.

MGO serves cannabis operators, among other specialties, and Webb said the smooth debut of so many recreational cannabis stores and growing facilities around the Chicago area reduced the stigma once attached to the product, and the tax revenues and jobs created attract the attention of government leaders.

“I can’t help but think that being treated like a manufacturer coming to town is in the future,” she said.

Voters in north suburban Wilmette supported the nonbinding measure by 55% to 44%, according to Village Manager Michael Braiman. The village’s board will decide in January whether to establish recreational retail operations. If affirmative, they will begin holding hearings on possible zoning changes governing how many operators can set up shop, where dispensaries can locate and what products will be sold. The board also needs to fill a $1.5M hole in the village budget.

“The tax revenues generated by these types of businesses will certainly be a factor in our conversations, but it also won’t be the only or determinative factor,” Braiman said.

The state classified both medical and recreational cannabis dispensaries as essential businesses when the pandemic hit, similar to grocery stores, which meant they could stay open despite shutdown orders. Both sales and tax revenue soared throughout the year even as other retailers are struggling to keep afloat.

In September, Illinois consumers bought about 1.4 million cannabis items for a total of nearly $68M, up from the previous record of $64M in August and up from $39M in January, the first month of legal sales, according to Marijuana Moment. The state brought in about $52M in tax revenue in the first six months.

Officials in north suburban Skokie blocked medical cannabis dispensaries when the state legalized that product a few years ago but eventually changed their minds about weed. Skokie Economic Development Manager Len Becker told Bisnow in February that they saw how useful medical marijuana was to residents and how little commotion the new recreational stores caused in the first weeks of legal sales. Village officials also said cannabis would diversify the economy and build the tax base.

Cannabis retailers usually splurge on both décor and customer service, and that helps them gain acceptance from surrounding communities, according to Baum Realty Group Vice President Nicole Cardot, who helps lead a team of brokers that completed numerous cannabis-related deals.

“You go into these spaces and they are really beautiful,” she said. “There is a growing number of villages and landlords who now see these outlets as reliable, in terms of the products they sell and in their attractiveness as tenants.”

Grassroots Cannabis, one of the nation’s largest cannabis providers, recently opened a Skokie outlet inside a renovated bank building at 10066 North Skokie Blvd., just north of Old Orchard Road and Westfield Old Orchard mall. The move may have saved the structure from demolition.

“It probably would have been bulldozed to make way for a quick-service restaurant or something similar,” Becker said. “We like it when vacant buildings get repurposed, especially buildings like banks, which don’t generate any retail sales taxes.”

“We’ll definitely be looking at the experiences other communities have had with dispensaries, especially those nearest to us like Skokie, Northbrook and Evanston,” Braiman said.

The high sales volumes recorded by most cannabis stores means investors stand ready to finance acquisitions, renovations and new development, according to Jarrett Annenberg, director of acquisitions for NewLake Capital Partners. The firm now owns four dispensaries in Illinois and recently invested $19.7M into Grassroots Cannabis.

“We are constantly looking to add dispensaries to our portfolio, and we have capital to deploy,” he said.

Nearly two-thirds of Mount Prospect voters supported recreational cannabis on Tuesday, the Chicago Tribune reported. Other suburban municipalities in the metro area approved product sales this year as well, including Arlington Heights and Naperville, which held a referendum on the issue in March.

“It’s just a matter of time before other communities that resisted adopting recreational cannabis decide to do so,” Cardot said.

Annenberg pointed out that what’s happening around Chicago is part of a national movement. Statewide referendums on cannabis were also held this week, and voters in New Jersey, Arizona, Montana, South Dakota and Mississippi voted to legalize either recreational or medical marijuana.

“It was on the ballot in five states and passed in all five,” he said. “It’s slowly making its way across the country.”