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Cresco Labs Secures Mortgage on New York Property

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Cresco Labs has announced the closing of the sale of its sole licensed Arizona operation, Encanto, to an affiliate of Mint Cannabis for $6.5 million.

Cresco has also confirmed the close of a conventional mortgage on its Ellenville, New York, properties for a principal amount of up to $25.3 million with an interest rate of 8.43%.

The company has said the developments support its “Year-of-the-Core” focus and enhance its balance sheet.

Charles Bachtell, CEO of Cresco Labs, stated: “We are pleased to announce the closing of the sale of our remaining Arizona asset. As we have highlighted over the past several quarters, we are focused on strengthening our operations and increasing profitability by leaning into our Core – core markets, core stores, core brands and core products.

“Our exit from Arizona aligns with our strategy of optimizing our portfolio by prioritizing assets with a greater path to scale.

“We are also thrilled to secure a conventional mortgage on our New York real estate at very favorable terms. This non-dilutive financing is another sensible tool for optimizing our balance sheet and lowering our cost of capital as we continue to strengthen our overall business.”

The Encanto sale followed approval by the Arizona Department of Health Services on October 17, 2023, and the New York mortgage was secured by three company-owned properties located in Ellenville, NY. Approximately $20 million was funded at close, with the remaining principal held to fund future capital expenditures.

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