Apr 26, 2024 Sponsored Post

Ready for War: Little Known Infrastructure Company Gearing Up To Disrupt The $25B American Cannabis Market

American cannabis is a $10 billion market that is expected to reach almost $25 billion within 3 years. And contrary to what you might think, its federal illegality is actually a huge opportunity for companies such as CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF), a ‘Cannabis REIT’ which aims to become the first dividend-paying cannabis stock.

Canada is on the verge of legalizing recreational cannabis use on October 17, 2018 but almost all cannabis investors are focusing their attention there and ignoring America.

However, when it comes to the size of the cannabis market, America beats Canada hands down.

 

In 2017, the entire Canadian market was about $5.7 billion[1]; including non-medical (i.e. still illegal) consumption. Furthermore, the data indicates that with so much capacity coming onto the market, Canada might actually experience a cannabis OVERSUPPLY[3].

 

By contrast, America’s legal cannabis sales did almost double that at $10 billion, and it is expected to hit $24.5 billion by 2021, an incredible growth rate of 28%! [2]

The real opportunity is in America where its laws have actually created a unique opportunity in the market that CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) is exploiting.

Source: Independent.co.uk[9]

 

CROP Infrastructure Corp. Is Exploiting A Funding Need in the Cannabis Market

 

Despite the massive size and growth rate of the American cannabis market, American cannabis producers have a massive problem – it is extremely difficult for them to get funding because of its illegality at the federal level.

Hence, most ‘traditional’ financing options are off the table. As Forbes Magazine reported in an article titled “Legal Weed Entrepreneurs Finding New Funding Options”[4]:

“The big banks won’t open a checking account for them, let alone lend them money, because cannabis production, processing and selling is still illegal at the federal level. Banking and financing options are limited, but there is a need and funding can be found.”

CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) is filling that need with an innovative business model that benefits both the company and cannabis producers alike.

CROP Infrastructure Corp.: The Cannabis REIT Focusing On America

CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) has a simple four-step business model:

 

  1. INVEST - The company invests in income producing property, such as greenhouses, and agricultural equipment.

  2. LOAN - The company then loans capital to licensed cannabis producers and processors to purchase said property and equipment.

  3. PAYBACK - The company receives a 60% preferential payback through lease and management fees until the loaned capital, plus interest, is fully repaid.

  4. PROFIT - CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) retains a 30% interest in the property and infrastructure, thus receiving dividends indefinitely.

CROP Infrastructure Corp.’s (CSE:CROP)(OTC:CRXPF) business model is similar to a REIT (Real Estate Investment Trust). The big advantage of this business model is that the company receives both cashflows and ownership interest in the property/infrastructure.

The ‘REIT’ business model in cannabis is a relatively new entrant on the scene. Investors who got in early on these two companies with similar business models have already made handsome profits.

Innovative Industrial Properties Inc. (NYSE: IIPR)

Market Cap: $250.7m

Considered to be the first ‘Cannabis REIT’, this company focuses on acquiring medical-use cannabis facilities and offering producers both capital and real estate solutions. Over the past year, this stock has returned 113% to investors.

CannaRoyalty Corp. (NYSE: IIPR)

Market Cap: $194.4m

While not exactly a ‘REIT’ business model, this company directly invests in licensed cannabis businesses in exchange for royalties, equity, convertible debt, or licenses. Its stock has returned 191% to investors over the past year.

The Build Out and Expansion of CROP Infrastructure Corp’s Properties Are Big Catalysts for Short Term Appreciation

Epidiolex

CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) is expanding and building state-of-the-art greenhouses in prime locations across America. The completion and subsequent leasing out of each property is a major catalyst for short term growth, meaning multiple potential movers for its stock price.

 

The company already has the funds to do it. In May 2018, the company closed a private placement worth $4.35 million, giving it a ‘war chest’ of convertible debt that allows development to move at full speed. Again, each stage of development is a potential chance for the company’s stock price to go up.

#1 Humboldt, California

Current Property Size: 10,000 square feet

Expanded Property Size: 30,000 square feet

Final Production Capability: 24,000 lbs of flower per year

 

CROP Infrastructure Corp.’s (CSE:CROP)(OTC:CRXPF) Humboldt property puts it in the perfect position to benefit from California’s cannabis boom, a market that is forecast to hit $3.7 billion in legal cannabis sales this year[6] (a figure that may be more than all of Canada put together).

 

The property is strategically located in the ‘Emerald Triangle’, the largest cannabis-producing region in America[5]. Good faith negotiations with a prospective tenant, the Hempire Company LLC, which holds a cultivation license has already begun and is expected to be completed soon.

 

#2 Washington State MEGA Greenhouse

Current Property Size: Under construction, almost 50% complete

Completed Property Size: 12 x 3,680 square feet greenhouses, total of approximately 44,000 square feet

Final Production Capability: 24,000 lbs of flower per year

 

CROP Infrastructure Corp.’s (CSE:CROP)(OTC:CRXPF) Washington State property is a ‘MEGA Greenhouse’ that is on track to be fully completed by end-2018. Each hi-tech greenhouse can hold 1,350 plants.

In addition to harvesting flower, this MEGA Greenhouse will also produce high quality sugar trim and popcorn smalls which will be used to create high grade concentrates and edibles. All in, the company estimates this facility to generate $38.4 million in annual revenue.

The main draw of this mega greenhouse isn’t just its size but also its cost. With an electrical rate of only $0.02/kWh (far below the US industrial average of 6.64cents/KWh[7]), production costs are estimated to be less than $150 per pound.

 

This means that CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) is fully ready for a price war. The company knows that its production costs are one of the lowest around for what it can deliver; any price war will ultimately only benefit it.

#3 Washington State Greenhouse No. 2

Status: Completed

Completed Property Size: 35,000 square feet of state-of-the-art canopy

Production Capability: 10,000 lbs of flower per year

 

CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) has also acquired an interest in a technologically advanced cannabis production facility that has been retrofitted for full hydroponic automation including sophisticated irrigation. The greenhouse is also outfitted with 500 Gavita HPS grow lights, a top-rated industry standard.

 

With this acquisition CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) has set itself up to be a huge producer in Washington State; the first state to legalize the use of recreational cannabis. By focusing on such strategic jurisdictions, the company will be able to benefit on both the short term and the long term.

 

#4 Nevada Greenhouse

Status: Development Begining Shortly

Completed Property Size: close to 2,000,000 sqft. of greenhouse space

Production Capability: to be determined. Find out more here.

 

CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) is strategically staging themselves with a critical property footprint in Nevada state. With 300 acres of land and 300 acres of water rights in Las Vegas country, they are building the largest operation in the state, close to 2,000,000 sqft. of greenhouse space, with development beginning shortly.

 

American Cannabis Is Here to Stay, and CROP Infrastructure Corp. Is Prepared for the Long Game

Source: Cropcorp.com[10]

 

CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) is more than just a short term cannabis play. Cannabis legalization is moving forward in America, with President Trump recently assuring senators that his administration would not interfere with individual states’ decisions on legalization[8].

That’s why CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) is already looking beyond California and Washington State. The company has three more locations already planned in Nevada, Colorado and Oregon. Over the longer term, it plans to evolve its business model to become a vertically integrated end-to-end business from growing all the way to branding.

These trends show that CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) is poised to become a major player on the American cannabis scene. The company may still be in the early stage, but things are moving fast

Five Reasons CROP Infrastructure (CSE:CROP)(OTC:CRXPF) Can Disrupt The Cannabis Space

  • 1
    #1 America, not Canada, is the Big Cannabis Opportunity on the Continent
    The American cannabis market, even without federal legalization, far outstrips the Canadian market. With $10 billion in legal sales in 2017 that is projected to increase to $24.5 billion by 2021. This is a true growth opportunity.
  • 2
    #2 CROP Infrastructure Corp.’s Properties Expansion Creates Multiple Short Term Growth Catalysts
    CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) is moving quickly in expanding and taking its California and Washington State properties into production. With a ‘war chest’ already in place for funding, the development of each property could be significant catalyst to profitability.
  • 3
    #3 CROP Infrastructure Corp. is Geared Up to Win Any Price War
    CROP Infrastructure Corp.’s (CSE:CROP)(OTC:CRXPF) MEGA Greenhouse facility enjoys electricity costs of $0.02/kWh and estimated production costs of under $150 per pound. The company is prepared from the beginning to produce cannabis cheaply, and is ready to come out on top in any price battle.
  • 4
    #4 CROP Infrastructure Corp. Is Set to Become A Major Player on the American Cannabis Scene
    Legal American cannabis is here to stay, and so is CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF). The company is already planning to expand into other states across the country while also evolving its business model to become and end-to-end producer, from growing all the way to branding.
  • 5
    #5 CROP Infrastructure Corp. is An Early Stage Cannabis Opportunity That May Become the First Dividend-Paying Cannabis Company
    Companies with business models similar to CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) have already made huge returns for early investors. CROP Infrastructure Corp. (CSE:CROP)(OTC:CRXPF) is an early stage deal that has the potential to to pay out dividends.

 

[1] http://www.cbc.ca/news/business/marijuana-industry-1.4503152

[2] https://globenewswire.com/news-release/2017/12/06/1234230/0/en/NEW-REPORT-Legal-Marijuana-Sales-to-Grow-33-to-10-Billion-in-2017.html

[3] https://www.cantechletter.com/2018/03/why-predictions-of-a-marijuana-shortage-in-canada-are-just-smoke-and-mirrors/

[4] https://www.forbes.com/sites/julieweed/2017/09/09/funding-options-for-cannabusiness-expanding/#4b20ab727cf3

[5] https://en.wikipedia.org/wiki/Emerald_Triangle

[6] https://www.businessinsider.my/california-legalizing-weed-on-january-1-market-size-revenue-2017-12/?r=US&IR=T

[7] https://www.eia.gov/electricity/monthly/epm_table_grapher.php?t=epmt_5_6_a

[8] https://www.reuters.com/article/us-usa-trump-marijuana/trump-to-lift-legal-threat-to-states-that-permit-marijuana-use-idUSKBN1HL001

[9] https://static.independent.co.uk/s3fs-public/thumbnails/image/2016/11/10/09/unnamed.png?w968h681

[10] https://cropcorp.com/about-us/

STOCKS YOU MAY LIKE


Disclosure:

1) The author of the Article, or members of the author’s immediate household or family, do not own any securities of the companies set forth in this Article. The author determined which companies would be included in this article based on my research and understanding of the sector.

2) The Article was issued on behalf of a third party, Crop Infrastructure Corp. Market Jar Media Inc. has or expects to receive the following amounts from Native Ads Inc. in the amount of forty seven thousand, eight hundred twenty four dollars for 5 campaign days (5 business days).

3) Statements and opinions expressed are the opinions of the author and not Market Jar Media Inc., its directors or officers. The author is wholly responsible for the validity of the statements. The author was not paid by Market Jar Media Inc. for this Article. Market Jar Media Inc. was not paid by the author to publish or syndicate this Article. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. Market Jar Media Inc. requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Market Jar Media Inc. relies upon the authors to accurately provide this information and Market Jar Media Inc. has no means of verifying its accuracy.

4) The Article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Market Jar Media Inc.'s terms of use and full legal disclaimer as set forth here. This Article is not a solicitation for investment. Market Jar Media Inc. does not render general or specific investment advice and the information on Market Jar Media Inc. should not be considered a recommendation to buy or sell any security. Market Jar Media Inc. does not endorse or recommend the business, products, services or securities of any company mentioned on Market Jar Media Inc.

5) Market Jar Media Inc. and its respective directors, officers and employees hold no shares for any company mentioned in the Article.