This story was republished with permission from Crain’s Detroit and written by Dustin Walsh.
Lume Cannabis Co. plans to take over the large cannabis grow facility near Lansing that’s being abandoned by competitor Skymint.
Lume signed a letter of intent on Friday to become the lessee of the 56,000-square-foot Harvest Park facility at 10070 Harvest Park in Dimondale.
Skymint is shuttering its operations at the facility, owned by massive cannabis property developer Innovative Industrial Properties, by March 1 as part of its restructuring effort coming out of a months-long receivership.
The operation was Skymint’s last cannabis growing center in the state. Instead, Skymint will source products from other growers and continue to operate its 22 retail locations across the state.
Lume will continue due diligence before officially signing a long-term lease with IIP, but the plan is to occupy the facility in the next 90 days, said Doug Hellyar, president and COO of Lume, one of the state’s largest cannabis growers and the largest retailer by number of locations.
The company is working to obtain a local license from the village of Dimondale before it takes over the facility, he said.
Lume plans the first harvest at the Harvest Park facility in August. Then plants will be flash-frozen and shipped to its processing facility in Evart. Once operations are stable, the company plans to move its solventless extraction operation to the Dimondale facility, Hellyar said.
Eventually, the Dimondale operation will become its exclusive location for its live rosin product called Lume Gold Label, which is a concentrate product used in vapes and in smokable cured form.
“We need it because our product is in high demand and we can’t satisfy demand for our Gold Label product with our current footprint,” Hellyar said.
Hellyar claims when fully operational, the Dimondale facility will be the largest dedicated facility for live rosin in the state, possibly the nation.
Lume plans to invest millions of dollars into a new lighting system at Harvest Park as well as other upgrades.
Moving extraction operations to Dimondale will clear space for Lume to expand growing operations at its more than 200,000-square-foot facility in Evart.
Skymint once employed 143 at the Harvest Park facility. Some of those employees will likely be retained for the Lume grow operation, but the total number is not yet known, Hellyar said.
Skymint is beginning layoffs at the facility this week.
The embattled Skymint entered receivership in March last year after being sued by their primary lender, Canada’s Tropics LP, to whom they owed $127 million.
Tropics, under a new entity called Skymint Acquisition Co., acquired the assets of Green Peak Industries, doing business as Skymint, out of receivership for $109.4 million in a stalking horse bid in October. Tropics is a subsidiary of Sunstream Bancorp., which is a joint venture with the publicly-traded SNDL Inc. (NASDAQ: SNDL).
Under the deal, Tropics acquires Skymint’s cultivation assets as well as 22 retail leases with dispensaries that produced annualized sales of approximately $68 million in September, the company said in a news release.
In April, Skymint ceded its lease on the former Summit Sports and Ice Complex near Lansing. The company planned to double its marijuana production capabilities with the facility but never completed the build-out. Skymint surrendered the 176,000-square-foot facility and 21 acres back to developers IIP, the country’s largest cannabis property developer.
Meanwhile, Lume has continued to grow and plans to generate more than $200 million in revenue this year.
The company operates a grow facility in Evart and 38 dispensaries across the state.
Read More Feedzy
