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Plans for massive marijuana greenhouse advance

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A rendering of a 1 million-square-foot marijuana greenhouse and processing center AmeriCann Inc. seeks to build in Freetown.AmeriCann Inc.

On the eve of a vote that could legalize recreational marijuana in Massachusetts, a Colorado company is preparing to build the state's largest marijuana greenhouse, a sprawling, high-tech complex that could eventually expand to nearly 1 million square feet.

Denver-based AmeriCann Inc. completed a deal last week to lease a 53-acre parcel for the project near Route 24 in Freetown, where officials have welcomed the company's proposed Massachusetts Medical Cannabis Center as a potential economic boon.

The facility, to be built in phases over several years, is designed to bolster the state's struggling medical marijuana program. But if voters here decide on Nov. 8 to legalize the sale of marijuana for recreational use by adults, AmeriCann expects to accelerate construction and would likely rent some of its cultivation space to a retailer of recreational cannabis.


"Adult-use changes the timeline of the project," AmeriCann chief executive Tim Keogh said. "It's definitely part of the conversation with investors now, more so than it had been 12 or 24 months ago."

The publicly traded company had announced a deal to buy the undeveloped land from Boston Beer Co. earlier this year but delayed finalizing the purchase several times. Last week, a separate investment firm formed by relatives of AmeriCann's chief financial officer closed on the property for $4.47 million and leased it back to AmeriCann for 50 years, allowing the ambitious project to move forward.

AmeriCann is raising funds for construction and hopes to break ground in about three months on the project's first phase, a $20 million, 160,000-square-foot greenhouse the company said would more than double the state's cannabis-growing capacity. Construction would last about nine months.

"We're very excited about getting this land developed, realizing the economic impact on the local area, and helping patients in Massachusetts," Keogh said.


Eventually, AmeriCann hopes to expand the complex to three buildings, with room for offices, a quality-assurance laboratory, and a facility for manufacturing cannabis-infused food, lozenges, and tinctures. Citing security concerns, the company wouldn't say how much marijuana could be produced and processed at the greenhouse, which will be closed to the public.

The Freetown facility's first tenant would be Coastal Compassion, a medical marijuana dispensary that has received a provisional license from the state and is building a storefront in Fairhaven with funding from AmeriCann; Keogh cofounded the dispensary in 2013 and serves on its board.

Keogh grew up in Marion and worked as a consultant in the marina business. He said he first got involved in medical marijuana after a close friend in Rhode Island undergoing chemotherapy began using it under that state's medical program.

Keogh joined AmeriCann in 2014 just as legal cannabis went on sale in Colorado and the movement had begun to spread to other states.

But the company is relatively untested and tiny: AmeriCann has just two employees and a market cap of only $23 million. So far it has helped launch a small growing facility in Colorado and is working on similar deals in Delaware and Maryland. But several other projects have stalled or ended in a business dispute with the dispensary partner.

Keogh said AmeriCann will try to raise the first $20 million by issuing convertible notes and courting private equity firms, private investors, and other small investment outfits.

AmeriCann's complex will be in an area of wooded tracts and industrial parks, with few nearby residences. It's less than a mile away from the massive warehouse Amazon recently opened on the Fall River border.


Boston Beer Co. bought the land in 2007 for $6 million to build a brewery there but later canceled the project. Then in 2013, a year after medical marijuana was approved in Massachusetts, Freetown residents voted at Town Meeting to designate the property for use by a marijuana operation — a stark contrast to other municipalities that have tried to keep marijuana businesses out.

"We wanted to get out in front of it, so we identified a parcel in an area of town that's away from residences and would be suitable for this type of business," explained Freetown Planning Board chairman Kevin Desmarais in an interview earlier this year.

Freetown officials said they were impressed with AmeriCann; selectmen voted unanimously to approve its site plans, and even the police chief has endorsed the complex's security.

"It was very professional. We approached it like any other project, like they were growing tomatoes," Desmarais said. "Everybody understands now that this is legal in the state and there's no coming back from that."

If Coastal Compassion expands its business as Keogh hopes, AmeriCann will add 400,000-plus square feet to the first building. Another dispensary or recreational grower could occupy the smaller "Building B" at a later stage.

Under Massachusetts' medical marijuana program, retail dispensaries must grow most of their own plants. So dispensaries leasing space inside the Cannabis Center would tend the plants, while AmeriCann acts as landlord and growing consultant. Such arrangements are increasingly common, as a new group of investment, real estate, and consulting companies seek to profit from the so-called green rush without actually selling marijuana, which remains illegal under federal law.


Advocates have repeatedly complained that Massachusetts has too few medical marijuana dispensaries and growing facilities and the legal marijuana available is too expensive — problems Keogh hopes the Freetown complex will help solve.

The Freetown greenhouse, Keogh said, will be more efficient than other growing facilities, using solar panels, roof slats that open to let in sunlight, and other features to minimize utility costs.

"Our utility consumption is 60 percent less than a typical indoor warehouse, which is a tremendous benefit in terms of driving down the cost of production and the carbon footprint of the cannabis industry," Keogh said.

The complex will also feature a computerized horticultural system to automatically control air temperature and light levels, plus a compartmentalized layout to help stop pests, blight, and unwanted pollination.

Dan Adams can be reached at daniel.adams@globe.com. Follow him on Twitter @Dan_Adams86.