A marijuana joint lays on top of a magazine.

How Illegal Dispensaries put Landlords at Risk

Since the legalization of marijuana for recreational use in New York in 2021, the city has witnessed an expansion of retail dispensaries. However, out of the estimated 5,000 shops in the five boroughs, only six are legally licensed. This surge in unlicensed businesses poses significant ramifications for building owners who lease their commercial premises to these illegal weed stores. The New York City Council has proposed a bill to hold owners accountable for leasing to unlicensed cannabis sellers. Moreover, Governor Kathy Hochul has suggested empowering authorities to shut down illegal shops and impose substantial fines on the owners.

Unregulated Cannabis Products put New Yorkers at Risk

Unregulated products sold by these unlicensed stores have been found to contain harmful contaminants. This underscores the importance of proper licensure to ensure consumer safety. Nevertheless, the law's lack of enforcement and existing loopholes have allowed these stores to thrive.

To combat this issue, Mayor Eric Adams and Manhattan District Attorney Alvin Bragg are exploring using New York's Real Property Actions and Proceedings Law (RPAL) to prompt property owners to evict illegal businesses. Landlords can exercise their rights under the law to evict tenants who violate lease agreements.

How do Illegal Dispensaries Affect Landlords? 

Although landlords may not know about their tenants' illegal activities, they could still be held accountable. Consequently, it is crucial for building owners to conduct thorough screenings of potential commercial tenants engaged in THC-related businesses.

Unlicensed weed stores in New York City pose a significant challenge for building owners who lease their commercial premises to these illegal businesses. With the proposed legislation, authorities aim to crack down on unlicensed shops and impose fines. 

Building owners should consult their lawyers beforehand, given the potential legal consequences and liability uncertainties. As the city and state intensify their efforts to address this issue, building owners must prioritize compliance and avoid being caught in the crossfire of enforcement actions.

Worried a Tenant is an Illegal Dispensary? Talk to Outerbridge Law

Here at Outerbridge Law PC, we have extensive experience dealing with illegal dispensaries and helping landlords navigate this complex issue. Please give us a call at 877-OUTERBRIDGE to schedule an initial consultation.