Matthew Morgan waits with great anticipation and tempered expectations to discard the limits of Nevada’s medical marijuana program and focus on developing the adult-use market, set to open on July 1.
The Las Vegas entrepreneur runs one of the largest vertically integrated cannabis companies in the state.
“I am excited to treat cannabis more like alcohol in regards to advertising, marketing and it being more mainstream versus medicinal,” Morgan says. “I have been doing this a while, for nine years. This is my first time entering the recreational market and I think we are positioned really well.”
Exactly one year ago, Marijuana Venture followed the launch of Morgan’s multifaceted cannabis business, Tryke Companies, along with its 165,000-square-foot flagship grow facility located just blocks away from the Vegas Strip. Today, the 32-year-old CEO of Tryke Companies is preparing for the recreational launch after what he describes as a “soft year” of medical sales.
“There was a lot of supply and not a ton of demand,” he says. “I’m expecting about one-third of all recreational sales to come from tourism and I expect sales to be at about two to three times of what they currently are, conservatively.”
For a while, it seemed as though Morgan and other business owners in Las Vegas would have to wait until early 2018 to welcome customers into their licensed retail outlets. But as of press time, and in accordance with the Clark County Commission’s Green Ribbon Panel, the sale of cannabis to adults 21 and older can begin July 1 through medical dispensaries that receive a special license allowing sales to recreational customers.
Tony Alamo, chairman of the Nevada Gaming Commission and a member of the Green Ribbon Panel, prompted the decision to separate ganja from gambling.
But there are some caveats with the summer rec launch — starting with consumption and gambling.
The commission agreed with Alamo’s suggestion that gaming companies not be directly involved with cannabis or allow it on site. According to Morgan, the gaming industry has been one of the biggest opponents of cannabis in Las Vegas.
“Obviously, the largest portion of employment in Las Vegas is from the service industry and since they are involved in gaming they are very opposed to cannabis,” Morgan says. “Remember that every gas station has keno machines and poker machines, so they have a gaming license. Everything I have found in Nevada has some sort of tie to gaming and they won’t touch cannabis. It’s a logistical challenge in the micro-climate of Las Vegas.”
Morgan says it’s unlikely that casinos would distribute free joints to gamblers the same way they do with alcohol, even if they were allowed.
“They want to get you as drunk as possible,” he says. “Alcohol tends to do a little better job of getting people loose than cannabis does. The next thing they know everyone is over at the restaurant and no longer gambling.”
So far, the consumption laws have been a major topic at every meeting of the Green Ribbon Panel, the 12-member group that is tasked with making licensing and zoning recommendations to the county commission. The panel features members of the cannabis, gaming and retail industries. The gaming portion of the panel says off-strip consumption lounges look to be the most agreeable option, but there are myriad conflicting interests of how those would work. Morgan believes there’s “no chance” that public consumption of cannabis will mirror that of alcohol in Las Vegas, but he does think Nevada might succeed where Colorado and other states have failed with social use cannabis clubs.
“I think the lounges have a good chance,” Morgan says. “The hotels are for the lounges, just to keep it away from the strip. But the lounges would definitely not be allowed in the gaming corridor, aka Las Vegas Boulevard.”
Currently the hotels have a “don’t ask, don’t tell” philosophy, Morgan says. Creating lounges would allow hotels to stay in compliance with gaming regulations, accommodate guests and drastically reduce the amount of odor complaints hotel staff will have to respond to.
Those in the gaming industry “absolutely do not want public consumption and they absolutely do not want people using it in the casinos,” Morgan says. “So, that brings up the question of where people can use it. There’s 44 million people who visit here every year.”
The discussion over consumption rules is still predicated on approval by the state Legislature and Governor Brian Sandoval.
Meanwhile, the Green Ribbon Panel decided to take a different approach than Oregon or Colorado and not distinguish between medical and recreational sales until each transaction occurs. That means that cannabis will be regulated as a whole from seed-to-store. Prior to the full opening of the recreational market, Clark County intends to create “master” licenses to allow recreational sales from businesses licensed to sell medical cannabis.
As of the July 1 launch, only 20 Clark County retailers will be licensed to allow recreational sales. After 18 months, the county intends to treat cannabis as it does with alcohol: Any business that meets its criteria can become a licensed participant. The criteria have yet to be defined by regulators, but the commission estimates new marijuana retailers will be operational as soon as Jan. 1, 2019.
“From what I am hearing, after 18 months they are going to take a step back and look at the industry and see if, given demand, we will need more stores,” Morgan says.
With 11 acres of land ready for development in Reno, one might think that Morgan would be primed to set up as a third-party wholesaler for the industry, but he’s not ready to ramp up expansion plans just yet.
“I think I will actually be going out to buy wholesale,” Morgan says. “You’d think it would be the opposite. We have a certain amount of genetics that we want to concentrate on, so we will definitely need to go shopping around in order keep up a variety.”[contextly_auto_sidebar]