Item 9 Secures Financing to Expand Lab Sites in Arizona and Nevada
Ryan Allway
August 31st, 2021
News
Pelorus Equity Group (“Pelorus”), the leading provider of value-add bridge commercial real estate loans to cannabis businesses and owners with cannabis-related real estate, has entered into a $19 million construction-financing loan with Item 9 Labs Corp. (OTCQX: INLB) (the “Company”), a vertically integrated cannabis dispensary franchisor and operator that produces premium, award-winning products.
The funds will be utilized to expand the master site development of the Company’s cultivation and lab site in Coolidge, Arizona (the “Arizona Facility”), as well as to finish the Company’s current 20,000 square foot facility in Pahrump, Nevada (the “Nevada Facility”). Since 2017, the Arizona facility has been farming and manufacturing a variety of premium Item 9 Labs cannabis products. Early in 2022, the Nevada Facility will be operating.
The profits from Pelorus’ high-performance loan will be used to purchase 45 acres of land close to the company’s current 19,200 square foot Arizona facility. The 5 acres that hold the existing plant, which includes two steel structures, are now owned by the Company. The master site development includes 16 greenhouses and six headhouses, as well as six additional steel structures (just under 10,000 sq. ft. apiece) – one for lab extension and support space for completed product, and the other five for indoor production – and 16 greenhouses (or greenhouse support buildings). The Item 9 Labs complex will have a total operational area of over 640,000 square feet once completed. This includes 5 acres of outdoor growing, which comes at a good time because the city of Coolidge just enacted outdoor cultivation regulations earlier this year.
Item 9 Labs’ product line includes more than 75 active cannabis strains, over 150 distinct cannabis vape products, premium concentrates, and Orion vaping technology. According to LeafLink, Item 9 Labs is currently the most popular brand at more than 60% of Arizona’s dispensaries. Arizona’s overall legal marijuana market is expected to reach $1.5 billion in the next three years, according to industry analysts.
Construction on Phase 1 will begin in early October and be completed in mid-2022. The first phase of construction includes three steel buildings and two greenhouses. This first extension includes 9,600 square feet of indoor cultivation space, 9,600 square feet of lab and packing space, and a 9,600 square foot head house to accommodate the addition of two 18,000 square foot greenhouses. Item 9 Labs expects to increase premium flower output by 30-35 percent and minimize its need on third-party supplied material for lab outputs by 40-50 percent once the project is completed. Item 9 Labs expects to hire 60-70 individuals in the first phase to support new operations in cultivation, processing, and packaging.
Item 9 Labs will also utilize the funds to finish its 20,000 square foot state-of-the-art facility in Pahrump, Nevada, which is now 60% complete. The new area comprises 4,450 square feet for flower, 990 square feet for plants, 400 square feet for clones, 300 square feet for dry curing, and 615 square feet for genetics. There’s also more than 2,500 square feet of post-processing and lab space, as well as the possibility of a cooperative venture with a 1,100-square-foot commercial kitchen. Auxiliary areas such as water rooms, offices, locker rooms, and break rooms make up the rest of the facility. The Company will cultivate and manufacture for partner dispensaries across the Silver State once it is completed in late 2021.
This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.
About Ryan Allway
Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.
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