Nov 22, 2023 - Business

Detroit is slowly getting closer to opening weed lounges

Illustration of a red, velvet rope hooked between two joints.

Illustration: Allie Carl/Axios

The road to Detroit becoming a city with lounges for legal weed consumption is still long, but it did make a big step this month.

The latest: The city awarded 37 cannabis business licenses last week, including its first for consumption lounges.

  • It's the second round of licenses after the first was awarded last winter, which included retail businesses but no lounges.

Why it matters: Consumption establishments are a unique type of cannabis business that are much rarer than retail shops in Michigan, partly because they're difficult to make profitable.

  • They allow consumers to hang out and smoke onsite, but people can't buy alcohol nor cannabis onsite. Patrons have to buy product from a nearby retailer or get delivery.

State of play: Only one business, Legacy Greens at 19347 Mt. Elliott, was awarded a consumption lounge license.

  • Four others got provisional lounge certificates — meaning they met all the criteria aside from having secured property.
  • The businesses — Altered State, Green Graffiti, CJ Ball and Smokers Club — have 18 months to acquire a property, per the city's website.

Zoom in: Altered State is run by Richard Fleming, who plans to open a "farm-to-tray" lounge alongside a small grow-and-retail facility by using a lounge and a microbusiness license. He's now seeking a 12,000-square-foot location.

  • "It has to be in the right location so people can access us, learn about us. Because this is uncharted territory here with most of the cannabis industry, even in more mature markets," Fleming tells Axios.
  • He says the city's technical assistance was hugely helpful and having the provisional license helps "open doors" in the real estate world.
  • "What [the city] did was give a guy like me a shot," Fleming adds. "I had felony cannabis convictions and I was stuck in the service industry because of those convictions, and now instead of serving trays of food I can serve trays of fresh cannabis."
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