Exclusive | Growing like a weed: Legal cannabis shops in NY will soar to sky-high…
January 1, 2025
It’s going to grow like a weed.
The legal cannabis industry will take New Yorkers even higher in 2025, with state regulators projecting the number of new licensed pot stores will more than double — soaring from 275 to more than 625.
In 2024, consumers purchased more than $840 million in legal gangia. When factoring in sales from 2023, the legal market has exceeded the milestone of $1 billion in total sales.
The Office of Cannabis Management said sales in 2025 could exceed $1.5 billion, or about double last year’s haul while law enforcement will expand efforts to padlock illegal stores.
“With the Office licensing approximately 30 dispensaries per month in the last quarter of 2024, we would expect over 350 dispensaries to open in 2025,” OCM policy director John Kagia said.
Cannabis industry representatives love that buzz.
“Doubling the number of stores opening in 2025 would be huge. It will help suffocate the illicit operators,” said Joe Rossi, a Park Strategies lobbyist who reps a dozen clients in the cannabis industry.
“There’s reason to be optimistic. The cannabis industry is starting to turn the corner,” added Rossi, who’s been an outspoken critic of the Empire State’s cannabis rollout.
Industry regulators are eager to help New Yorkers roll ’em.
“While OCM continues to refine its out-year projections with market analysis and feedback, 2025 sales could certainly exceed $1.5 billion,” OCM Executive Director Felicia Reid told The Post.
“It’s also significant that entrepreneurs in the market are deeply dialed into consumer tastes and interests, so their adaptability will factor into the pace of market growth as well,” she added.
Flowered or pre-roll marijuana accounted for 45% percent of sales last year, followed by vapes with 28%, and edibles, liquids and pills with another 27% combined, according to OCM data.
The agency also expects to license hundreds of new cannabis processors and other businesses in the supply chain this year.
Significant progress was made in shrinking the illicit market in 2024, but black market dealers still pose a vexing challenge to the legal doobie sellers, weed industry sources said.
State authorities and the New York City Sheriff and NYPD padlocked hundreds of illegal shops after a new state law was approved last spring making it easier to do so.
“Our actions remain focused against unlicensed cannabis retailers, which undermine New York State’s ability to build a truly equitable market,” OCM said in its just-released enforcement report to Gov. Kathy Hochul and the legislature.
“Proliferation of unlicensed cannabis shops continues to pose a public health threat as the unregulated products on their shelves are not tested to OCM standards and are often packaged in a manner attractive to youth.”
OCM said it will “significantly expand” its enforcement efforts to weed out the unregulated market, which includes targeting the networks supplying cannabis to illicit operators in the Empire State.
The pot market has been smoking hot in recent months after a rocky two-year rollout marred by lawsuits, a massive illegal market and enormous backlogs in the awarding of retail licenses issued by the often-criticized understaffed and overwhelmed OCM.
Hochul last year ordered a management shake-up after a scathing report she commissioned in May issued blunt criticism of how the regulatory agency was run and 64 new staffers were hired.
In an indication that the smoke is clearing, cannabis industry experts now express concern about too many licensed pot shops opening and cannibalizing each other’s business.
One state cannabis official suggested the number of pot shops be capped at 1,600.
“We want to be smart about the rollout,” said Joseph Belluck, chairman of the state Cannabis Advisory Board. “It makes sense to go slow and see what the data tells us.”
The last thing the state wants to see is weed operators opening and then closing because of over-supply, which has happened in other states such as California, Belluck noted.
“It’s a balancing act. The biggest challenge is opening as many stores as possible in a way that is sustainable,” he said.
The OCM and the policy-making Cannabis Control Board have yet to weigh in on whether to impose a cap on pot store licenses, but they may soon address the issue.
“With its obligation to help build New York’s cannabis industry, OCM knows the importance of assessing approaches that increase consumer access to legal cannabis, promote public safety, and keep the market accessible — without hypersaturating or destabilizing the supply chain,” executive director Reid said.
Despite the optimism, grassy problems remain.
OCM , for example, is still playing catch-up with a backlog of applications.
The agency also got slapped with another lawsuit last month, accusing regulators of allowing some wannabe pot merchants to apply for a license without first securing retail locations and notifying local municipalities, as required under the state’s 2021 cannabis law.
A judge imposed a preliminary injunction barring OCM from approving those applications pending a final ruling.
Hochul, who took flak for the botched roll out, is claiming credit for the turnaround.
“Last year, Governor Hochul promised to transform New York’s cannabis industry and took the steps necessary to propel it forward,” a Hochul spokesman said Wednesday.
“Today, illegal stores that riddled neighborhoods are rapidly becoming a distant memory, legal sales—having just surpassed $1 billion—are skyrocketing, and our communities are beginning to see the impacts of reinvestment. Thanks to Governor Hochul, New York’s newest billion-dollar industry is on course to boom in 2025, and we expect that this will be the year it cements itself as the strongest and most equitable in the nation,” said the governor’s rep.
Search
RECENT PRESS RELEASES
Related Post