AFC Gamma, a West Palm Beach-based real estate investment trust, now has $120 million in capital on hand to lend to cannabis operators.
AFC Gamma, which stands for Advanced Flower Capital, announced it raised $80 million of equity from 20 family offices, completing the first round of its $200 million investment vehicle, according to a press release. The commercial mortgage REIT also has a credit line of up to $40 million, freeing up a total of $120 million in capital.
The company has so far provided $50 million in financing to five marijuana businesses, including dispensaries, cultivators, processors, and combined operations. It has committed to lending another $30 million to existing borrowers and to two new borrowers, according to the release.
Traditional financing is notoriously difficult to get for cannabis companies, experts say.
AFC Gamma’s announcement comes as landlords of cannabis production facilities and dispensaries are outperforming the rest of the retail market during the pandemic. Marijuana product sales remained steady, and even saw gains in some states, including in Florida.
Total sales of medical marijuana in Florida blossomed, increasing 56 percent between March and May, compared to the same period in 2019, the Wall Street Journal reported, citing data from the Florida Office of Medical Marijuana Use.
Investors have flocked to states with legal recreational use, with some investment firms opening offices and making moves in states where legalization looms on the horizon.
Write to Katherine Kallergis at [email protected]