Medical marijuana: Florida’s new business boom
Some of South Florida’s most established nurseries contemplate adding medical marijuana, Florida’s newest crop, as the state begins creating industry regulations.
07/19/2014 5:18 PM
07/19/2014 6:10 PM
Before the sun set over the rows of palms and ferns and hibiscus that Thursday, Chuck Buster had heard from a half dozen friends, all calling to tell him that his next venture could be in Florida’s medical marijuana business.
For more than three decades, the co-owner of Alpha Foliage has tilled the Homestead earth near the southern tip of Florida, raising tropical foliage season after season. But a rising drumbeat to bring medical marijuana to Florida, plus a Legislature that relented on the last day of the lawmaking session last spring have combined to create a potential new business boom for nursery owners such as Buster.
What he learned on that Thursday in May was that his nursery qualified as a potential pot growing location. So with 300 acres at his disposal and 30 years of experience in the foliage business, Buster suddenly found himself poised to enter the legal pot business.
He’s far from alone. Alpha Foliage is one of 50 veteran nurseries, including 12 based in South Miami-Dade County and one in Broward County, eligible to compete to become one of five regional growers. That has fueled a frenzy of callers — ganja-preneurs, investors, technology companies — looking to partner with an eligible nursery in what will become Florida’s newest legal crop, a limited, low-THC form of marijuana for medical purposes. It will be used for patients with seizures, severe and persistent muscle spasms and cancer.
“I started getting all these inquiries as to whether I had any interest in partnering in a marijuana growing operation,” said Buster, as he surveyed the growing list of agricultural companies from the town of Havana in North Florida to Homestead, that met the criteria of operating for at least 30 years and having an inventory of 400,000 plants. “Everybody is trying to be a part of this.”
Twenty-three states and the District of Columbia have legalized use of some medical marijuana. Florida became part of the group with the passage of the Compassionate Medical Cannabis Act this year.
The new law allows five medical marijuana dispensaries to cultivate marijuana low in tetrahydrocannabinol, or THC, the chemical that provides a euphoric high, but high in cannabidiol, or CBD, which can calm seizures. The plants will be processed into an oil form and taken orally.
The law and speculation about Amendment 2 — a proposed constitutional referendum set for a statewide vote in November that would expand the uses of medical marijuana in Florida — are attracting a slew of companies looking to do business in the state. They come brandishing cash and expertise, the tools they say will guarantee success in the expanding field.
Under the proposed rules drafted by the Florida Department of Health, the state will award regional licenses through a lottery that will include a pool of eligible participants. The second rule-making workshop is scheduled Aug. 1 in Tallahassee, but application forms can’t be created until the rules are formalized.
What is clear already: The investment required will be sizable. The license will cost $150,000, along with the grower’s posting a $5 million performance bond. Nurseries also will be required to have comprehensive technology and security. Growers will have to fingerprint and screen their employees.
How to grow it
Businesses and how-to-grow-medical-pot schools, many from out of town, are flocking to Florida to stake out a slice of the new industry, hosting seminars and conferences to train wanna-be “canni-business” owners on how to jump into a complex, highly regulated market. They talk about Florida as a destination for medical marijuana-related opportunities including growing and dispensing; lab testing and equipment; delivery services; payment processing and insurance; security, and real estate services.
Just this weekend, Colorado-based MMJ Business Academy held a two-day event at a Doral hotel for $299 offering advice and a “road map” for opening a marijuana business. The Summit and Solutions event also was a platform for entrepreneurs to pitch business ideas to industry professionals.
Similar events already have been held in Hollywood, Miami and West Palm Beach. In North Miami-Dade, a mammoth yellow billboard on the shoulder of Interstate 95 beckons entrepreneurs to a seminar in August at the Signature Grand in Davie. The Medical Marijuana Business Seminars’ one-day event, with a price tag starting at $395, offers a team including doctors, lawyers, dispensary owners, horticulturists and hydroponics experts. “The time is now to get in on the ground floor of an industry that is going to explode in Florida!” reads an advertisement.
For Buster, the burgeoning industry is attractive if his only investment is the land and license. After his nursery was added to the list of potential license holders, the calls flooded in, nearly two dozen from the U.S. and abroad. Some strictly wanted to invest. Others want to partner, bringing the technology needed to grow the plants.
“I am 75 years old and reached a point in life where I don’t want any more challenges. Growing marijuana is a technical type of growing that takes special equipment and techniques,” said Buster, who sells about two million fern baskets annually. “So anybody I would partner with, they would provide all the money and expertise and I would provide the license and land.”
Patients, not just profit
In the midst of the business boom are the personal stories, the hopes of parents whose children suffer intractable seizures and wait for the medical marijuana they believe can help. For many, it’s a last resort.
Seth Hyman, a business consultant and advocate, has made a mission out of trying to help find treatment for his daughter Rebecca, who has a rare genetic disorder. Up to 200 times a day, the 8-year-old suffers seizures, small and large. The seizures started about five years ago, becoming so disabling that she requires constant care. Hyman, who testified before the Florida House Subcommittee on Criminal Justice earlier in January in support of medical marijuana, said he has tried 15 to 20 medications to treat his daughter’s seizures, which often include the loss of consciousness and muscle contractions of the type known as grand mal seizures.
None has worked.
“Rebecca is the wonder of our life. She had so much potential before the seizures. She started to show progress. Progress for children who are medically complex can be something as simple as grasping a little toy or rolling or trying to sit up,” said Hyman, who lives in Weston with his wife, Danielle, Rebecca and oldest daughter, Melissa, 14. “Unfortunately, when she started having seizures five years ago, she started to regress.”
The seizures have left Hyman fearing the worst.
“Sometimes she turns blue and stops breathing. Just today, she had three grand mals. This is a normal, daily routine,” he said. “As desperate parents, we are fighting for any kind of possible relief.”
Ashley Trop, co-owner of Plants in Design, learned from the media that his Redland nursery — which began simply as staghorn ferns and bromeliads in a backyard about 40 years ago — was eligible to compete for a license. Since that spring day, the phone has been buzzing.
“A lot of people have come out of the woodwork. There is a huge amount of interest,” said Trop, a former Miami Beach firefighter who owns the nursery, specializing in bromeliads, with two partners. “We even had a woman in the U.S. Virgin Islands who called to say her son was a good marijuana grower there and could help us if we needed it. We have also heard from friends in Brazil who want to invest cash in the business.”
Trop and his partners haven’t made any final decisions about the opportunity.
“We have talked to a lot of people, but everything is still up in the air,” he said. “The good news is that this will help a lot of sick children and others who need it.”
Technical skill required
Robert DeLeon, of DeLeon’s bromeliads in Goulds and Mount Dora, checked his voicemail on Monday — there were three more messages from attorneys and business consultants from Colorado and California, all pitching their expertise in the industry, as the dozen or more before had done.
“We have definitely gotten our fair share of calls. We are weighing our options right now,” said DeLeon, who runs the business along with brother Don. “This will be a lucrative business, but it’s also a lot of hard work. Growing marijuana is not something that nurseries can do old-school style. It’s a really high-tech operation so you have to have the right partners.”
The family business operates on about 68 acres in the two locations. In July, 1980, Robert and Don DeLeon opened an 11,000-square-foot shade house on 2.3 acres of land in Kendall, specializing in rare bromeliads. Five years later, the nursery entered the wholesale market and moved to Goulds. They had been there seven years before Hurricane Andrew roared through, destroying the business. They rebuilt and opened their second location about 250 miles away in Central Florida.
On Thursday, DeLeon attended a medical marijuana business symposium in Orlando to learn more about the opportunities.
“The nursery business has gotten tougher, especially in the last six or eight years,” says DeLeon whose business moves about four million bromeliads and orchids annually. “This could be a great opportunity, but like everybody else, we just have to wait and see.”
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