Chad Investment Opportunity in a MA Cultivation Facility - 60% Funded

Hello everyone,

My name is Connor and I am working under the sponsor that is fundraising for a cannabis real estate opportunity in Whately, MA. Below is a bullet-point summary of the opportunity. We have sourced $24.2m in funding through a construction loan, and as the sponsor, have also absorbed a large number of initial costs as we developed this project to the point of being where it is at now. There is still $15.7m needed and the opportunity is available to accredited investors, internationally, through 62.8 separate $250,000 blocks (which represent the entire $15.7m).

The market is fairly new and taking off in MA, with neighboring states still living in the past when it comes to their consumption laws, lots of customers continue to cross state lines from NY and Connecticut to partake!

The entire breakdown can be found through the website link under the investor section. There you will find the entire investment summary along with 15 supporting documents.

Project: 176,000 SF existing facility to be renovated to cannabis cultivation on 40-acre site

Location: Whately, MA

Developer: Mustang Renewable Power Ventures, LLC (experienced developer of a recently completed $175M renewable energy/recycling project in Santa Barbara, CA)

Tenant: Dr. Robb Farms, $38M PE-backed, operator/developer of 160,000 SF of greenhouse facilities in Desert Hot Springs, CA, $36M revenue next 12 months.

Status: Fully permitted locally, Tenant was approved for adult use cultivation license by the MA CCC

Lease: $8.8M/year ($50/SF/Year) NNN, 1-year construction, 12-year base term, 2 separate 5-year options

CapEx: $41.6M total ($12.6M greenhouse acquisition, $7.8M new construction, $9.5M turnkey cannabis TI’s, $8.5M soft costs, interest reserve, loan fees including 10% contingency)

Yield: 21% Cap Rate

Equity: $13M (35%): $1.7M from Mustang, $11M from JV partner (85/15)

Debt: $23.5m (60% Loan to Cost, 14% Interest only, 2 years, then amortized over 15 years, due in 5 years)

Cash on Cash: 30% per annum, 3.3-year equity payback from cash flow distributions


3 years on Tenant stabilized operations via Sale to $5 billion market cap Innovative Industrial Property REIT (NYSE: IIPR), 11-12% Cap Rate or other favorable REIT. This would be an extremely accretive acquisition for IIPR as they are currently trading at a 2.35% dividend yield. Alternatively, we will consider a Long Term (12-year) Hold for Cash Flow Distributions.

IRR-3 Yr. Flip: 84%

IRR-12 Yr. Hold: 31%

Project Website:

Please do not hesitate to reach out with any questions or concerns at any time.

Thank you and happy Monday,

Connor Casner

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Hello. I read through your investor section, and I have a few questions. Basically you are construction company that got a 14% loan and will be paid from the investment to build out the facility? $31.43M to build out less contingency with $8.3M in financing and development fees? Do you have any agreement or MOU with IIRP or just being speculative? If you do not sell to REIT, breakeven is forecast in 3-4 years with a tenant paying almost $9M a year a rent? Do investors have any first lien claim on assets in case of insolvency or are they junior and lose everything?

“Per unit investment returns are estimated in the table below based on two holding periods: 3 years and 12 years. The decision to stabilize and flip for cash &/or REIT stock within an est. 3 year period to a real estate investment trust (REIT) such as Innovative Industrial Properties (NYSE:IIRP, market cap: $4.1 Billion, $850 Million raised in the past 12 months to acquire additional cannabis real estate projects); or, alternatively, to hold the project long-term (10+ years) for cash flow, will be based on market conditions, regulatory landscape and management.”


“Mustang arranged a 60% loan to cost 5 year term ADC loan ($24,200,000) with a NYC hedge fund (New Oak) to be supported by 40% equity from Mustang and its equity partners ($17,300,000). Take-out financing in year 3-5 with term debt &/or a sale to a cannabis REIT, such as industry leader, Innovative Industrial Properties (NYSE:IIPR) at an expected 11-12% cap rate exit value.”

Do you already have the $24.2M loan fully executed with funds transferred, or is this loan from hedge fund contingent upon you fully raising $15.7M from private investors in order to buy a $12.7M property? Have you already purchased the property in question or just an agreement to purchase in principle?


What’s with the solar panels? How much is that space leasing for? I imagine a lot less than $50/sqft…


Can developer build it: yes. Well thought out plan, scope, and approvals. Capable vendors. Costs are high and there is a lot of “fluff”. Unknown relationships between developer and key consultants, vendors, and contractors leaves the door open for double dipping without diclosures to investors.

Lease: LOI only… investor beware. NNN lease terms on a portion of the property but no mention of property tax allocation between tenant and landlord, could be a surprise down the road affecting ROI. Minimal tenant security deposit (and timing of deposit) is highly suspect.

Project financial plan: developer has invested time only and has no actual financial skin in the game (“equity contribution” is actually proceeds from development fee). Wording and financial structure is shady AF. Significant risk of cost escalation.

Liability: Structured as LLC. Would be better as a limited partnership with a General Partner and Limited Partners to minimize liability for passive investors.

This is portrayed as an investment opportunity but it’s really speculative RE development frontloading a cash out for the developer. Developer can’t figure out if his customer is the investor or the tenant. His words say one thing, but the money trail tells a different story.


Agreed with @Dirteagle, great points.

And IIPR nor any cannabis REIT will be paying that much for anything in MA 3-5 years from now. You should just pitch it to some now and have the tenant pay the rent - many REIT’s will pay buildout costs.

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Mustang Whately Investors, LLC (MWI) is a special purpose entity formed to acquire, develop, improve and lease the greenhouse property to an experienced cannabis cultivation company, Desert Hot Springs, CA-based Dr. Robb Farms. The manager of MWI is Mustang Renewable Power Ventures, LLC, (MRPV) a 12-year-old recycling and renewable project developer based in California. MRPV has invested over $500,000 over the past two+ years to option the property, complete all local permitting with the Town of Whately for the intended use and to complete the architectural and engineering to commence the construction of the greenhouse expansion and cultivation tenant improvements.

We have had discussions with IIPR senior acquisitions and underwriting management. They have confirmed they would be interested in acquiring the property once construction is complete and our tenant has fully occupied the property and has achieved stabilized operations (i.e., and estimated 30-36 months from acquisition closing.)

Breakeven will occur once the tenant occupies 50% of the building as their rent payment is sufficient to cover the debt service on the loan at that time (i.e., ~14 months from closing).

The MWI LLC Operating Agreement provides that equity investors receive 100% of proceeds from a liquidation following repayment of the loan. The loan has a 1st lien security, as is typical for all real estate loans.

Yes, MRPV as manager of MWI, after consultation with the MWI member investors, will determine if a 3-year hold and sale to a REIT is the best execution for the property vs. a longer-term hold for cash flow.

The property is tied up with an option agreement with the seller that provides for a closing date as late as June 6, 2021.

The loan is committed and is estimated to be funded to close the acquisition during the 1st week of May. The loan closing is subject to the 40% equity being funded into the real estate purchase escrow.

The property includes an existing 600 kw solar panel array. The tenant’s lease includes the benefit of the solar power generated on-site. The tenant’s total electricity consumption is estimated at 3.5 Mw. The 600 kw of solar will provide ~20% of total energy requirements.

All use of proceeds are approved by the lender and disbursed by lender on a monthly basis based on a bonded, guaranteed maximum price contract with the general contractor.

NNN lease terms provide that tenant is responsible for 100% of property taxes and insurance on the building.

Developer has invested more than $500,000 over the past 2+ years securing local approvals, completing architectural and engineering plans to commence construction following closing of the acquisition, and pre-leasing the space to a qualified, well capitalized, experienced tenant.

There is no cash out for developer. Development fee is only earned on completion of construction and occupancy by tenant of Phase 1 and 2 (50% and 100% of space).

Management compensation described in the offering creates maximum incentive on developer for performance and exit.

Thanks for the reply. It is an “interesting” approach to finance this deal, and I wish you well in finding willing parties to invest. As noted above, this seems geared much more to RE investors than cannabis. Why would you invest so much work in building out, yet receive no benefit (in first 4 years) from the high-value product produced by your expert tenant? Seems like a partnership with tenant, developer and outside investors based on sales would be far better deal (for the investor to actually see short and medium term returns). I would think that virtually anyone who reads or posts on this site would see this as a poor value proposition, as the future involves being vertically integrated to reap the full financial benefits and actually survive. Cogs, even big ones, will get broken off and discarded.

Don’t mean to beat you up, but I think that you posted this in the wrong type of forum. Commercial real estate investors, which have had their balls stomped in the office space, might find your investment package appealing to hedge existing portfolios.


Where is there 160k sq ft of green house in Desert Hot springs?


Right next to your property. Didn’t ya see it. It’s the big one!



So this is how investors(chads) recoup their investments when they can’t make it work. :man_facepalming:t2: Holy chit man, I just got off of a phone call and really can’t believe what I was told as opposed to what you typed here.

Stay away fellas, DM me for the details.

@CAGrowConnect there is no 160k sqft facility in coachillin let alone one that has has a decent harvest to cover overhead.


oh snap


“$38M PE-backed, operator/developer of 160,000 SF of greenhouse facilities in Desert Hot Springs, CA, $36M revenue next 12 months.”

Math does not add up. $36M with 160k sq ft would be $225 per sq ft per year (~$19 per month) generated before expenses. You would have to be wasting an immense amount of space, don’t actually have 160k of greenhouse or do things very poorly/inefficiently to generate that little product/revenue in such a large complex. At $2k per pound wholesale, that would be around ~18k pounds per year or ~3000 pounds every cycle. That is less than a 1/3 of an oz per sq ft per cycle, which sucks fucking balls. Much more likely is that they are good growers using only a small fraction of said 160k sq ft, which only exists as expansion plans.


With MA labor rates there is no way your doing a proper buildout on 160k sqft for 35mil. 100k build outs around here are running 45mil give or take and our labor rates are at least 20% below anywhere they could be located in MA.


So they are busting all of the black market growers in mass but letting chads build out 40M commercial properties?


$450 per sq ft of greenhouse space or does this include drying, storage and office facilities too? At what point does it make financial sense to just erect multiple steel buildings, say 6-7k sq ft with 10x 500 sq ft rooms each, and go full indoor, which creates a product that is of both high quality and value? Smaller rooms help mitigate many little problems (equipment failure, pests, stray pollen, etc.) from turning into very expensive systemic failures. Quality almost always goes down with scale.

What do these giant monolith greenhouse facilities really have to offer? No climate is perfect, certainly not the dessert or upper north east. So, while there are certainly cost savings using the sun for free light, the amount of ancillary equipment needed to properly manage environment is obviously huge (ie $450 per sq ft). Add in the fact that A+ indoor will have a 20-25% premium over light dep and I just can’t see the benefit of putting up so much capital for a giant mids factory. Is it solely the cost of power, if not, what am I missing???


I have no idea what the cost savings is, I do know that the greenhouse grows around here produce a lot, a lot of garbage. @BG305 has run all of these numbers and I think he decided a greenhouse was the way to go. Based on the pics he’s shared he definitely knows what he’s doing, I’d be curious how his light dep turns out. in theory I see no reason for the light dep bud to be of lesser quality but my experience with what I’ve seen for light dep has not been stellar.