To keep up with Maryland’s rapidly growing medical cannabis market, SunMed Growers recently completed a massive greenhouse expansion, tripling the cultivation space for what was already one of the state’s largest marijuana producers.
The $18 million remodel gives SunMed a 250,000-square-foot, Dutch-style greenhouse facility, including 180,000 square feet of cultivation space, capable of harvesting about 600 pounds of dried cannabis per week.
Focused on Growing
Although the Phase 2 expansion was always a part of SunMed’s plans, public relations manager Justin Garcia says the company needed to grow to keep up with the Maryland market, which now has more than 125,000 registered patients and about 100 licensed dispensaries. While many cannabis companies in Maryland are vertically integrated, SunMed has taken a focused approach, growing cannabis and selling it wholesale to retailers and to processors that manufacture concentrates and edibles.
“The No. 1 thing our dispensary and processor customers tell us is they need more flower,” Garcia says. “I joke that if we had triple the amount of product in our vault last week, we would have sold triple the amount of product.”
Even with so many companies being vertically integrated, almost every dispensary in Maryland carries SunMed flower or manufactured products made from SunMed cannabis.
“There’s a lot of craft beer out there, but we’d like to be a Budweiser and make sure it’s always on the shelf when you look for it, and you know what you’re going to get.”
SunMed sells both pre-packaged flower and bulk flower for deli-style sales, as well as pre-rolls, to retailers. Processors buy flower, trim and even some flash-frozen plants for live resin products.
“With all the products that are coming out now, flower is still the big driver for the cannabis marketplace in general,” Garcia says.
In 2017, SunMed was among the first wave of Maryland cannabis companies to receive its license. The Cecil County company made its first delivery to medical dispensaries on March 2, 2018, and broke ground on its Phase 2 expansion plans in 2019, increasing SunMed’s production space from 60,000 square feet in Phase 1 to the 180,000 square feet in operation today. According to Garcia, SunMed is still the only cannabis company in Maryland using a Dutch-style greenhouse.
The SunMed facility is outfitted with best-in-class LED lighting, environmental controls and material handling technology that eliminates heavy lifting.
“With the way we keep things moving, there’s a simplicity and elegance to the amount of technology that that we put into just the infrastructure itself,” Garcia says.
The expansion took about 18 months of planning and construction, some of which was delayed by the coronavirus pandemic. Greenhouse components coming from Holland took longer than expected, and some additional precautions had to be taken to keep employees and contractors safe, but for the most part SunMed was able to “power through,” Garcia says.
With medical marijuana industry employees in Maryland being classified as health care workers, SunMed was able to remain operational throughout the pandemic (the health care designation also puts SunMed staff in the state’s Phase 1A priority for COVID vaccinations). The company took steps to ensure social distancing, such as splitting up shifts, and implemented new disinfecting procedures.
“When you’re a medical facility already, there’s a lot of things in place that help that process,” Garcia says. “It was really just about turning that dial up to 11. More wipe-downs, more cleaning, more often.”
Commercial horticulture is a part of SunMed’s DNA. Jake Van Wingerden, the company’s founder and president, is a third-generation greenhouse grower who started Tidal Creek Growers in 2002, a company that now sells 8 million plants a year to garden centers and landscapers throughout the Mid-Atlantic and Northeast regions.
With SunMed’s Phase 2 expansion complete, the company now has more than 100 employees — up from about 50 before the expansion — and can focus on supplying the Maryland market with sungrown cannabis.
There’s still a debate among cannabis consumers and industry professionals alike about the merits of indoor-grown cannabis versus crops grown outdoors or in greenhouses, but Garcia says SunMed “proudly makes the distinction to say that our product is grown with natural sunlight.”
“We think the natural, full-spectrum sunlight yields a better terpene profile,” he says, but acknowledges that it takes a little more effort on the sales side to educate dispensary buyers and patients about the benefits of sungrown cannabis being more natural and more sustainable. There’s also a benefit of being cost-effective and being priced somewhere in between indoor and outdoor. Currently, SunMed is getting an average of about $2,500 per pound wholesale.
But one thing that’s been made clear to the SunMed staff over the past three years is that consumers don’t hesitate to say what they like and what they don’t like, Garcia says. Listening to feedback has helped the company fine-tune its products, both from a standpoint of the cannabis itself, as well as the packaging and branding.
“The patients speak loudly and quickly, and I think it’s necessary for companies in this market to be able to adapt very quickly to that,” he says.
This year, Maryland lawmakers will consider a bill that would effectively legalize marijuana for recreational use. Whether it happens in 2021 or later in the future, that transition seems inevitable. A poll released by Goucher College in early March indicated two-thirds of Maryland adults favor the legalization of recreational marijuana — up from 57% two years ago.
Garcia says SunMed completed its recent expansion to keep pace with the current demand, but “would love to be in the conversation” if the legalization measure progresses. However, SunMed is clearly not banking on the adult-use market to solidify its financial standing.
“I think we have a good grip on what we do medically,” Garcia says. “I think it’s an important distinction that there is a medical market. Being held to a higher standard and the rigorous testing that we put our product through is worth noting, and I think the regulations that have been put in place are good for both patient safety and for the accountability of license-holders.”
And until major change comes to Maryland, Garcia says, “We like to be a standard bearer for what a medical market can be and should be.”