New York-based Ascend Wellness Holdings continues to acquire cannabis companies in Illinois, scooping up Chicago-based medical and recreational cannabis retailer Midway Dispensary as well as the company’s “plus one” recreational license, which it plans to operationalize in suburban Chicago Ridge.
Although Ascend did not announce a purchase price and Midway Dispensary did not return a query for comment, a source with knowledge of the transaction confirmed for Grown In that the value assigned to the cannabis retail assets is between $25 million and $30 million. If the transaction is approved by the Illinois Department of Finance and Professional Regulation, Ascend will own eight dispensaries in Illinois in addition to cultivation facilities.
In August, Ascend agreed to acquire two Modern Cannabis (MOCA) dispensary licenses in Chicago for approximately $30 million. Prior to that acquisition, Ascend raised $41 million from venture capital investors at a valuation north of $300 million. Ascend co-founder and CEO Abner Kurtin told Grown In at the time his company intended to own the maximum ten dispensaries allowed in Illinois by statute, including five that sell to medical and recreational customers.
Public and venture investors are pushing up values for vertically-integrated, multistate cannabis operators in states with limited licenses like Illinois. Ascend, which is on track to become publicly traded early next year, first entered the Illinois market in 2018 with its acquisition of Springfield-based HCI Alternatives. That deal included 75,000 square feet of cultivation space in Barry, Illinois plus dispensaries in Springfield and Metroeast Collinsville, across the Mississippi river from St. Louis.
While the original Midway Dispensary location has been operational since 2016, the company has had difficulty in getting approval to open a second recreational store in Chicago’s South Loop, a privilege won in a location lottery conducted by the city in early 2020.
Grown In has confirmed that instead, Ascend will move Midway’s second location to southwest suburban Chicago Ridge. On November 17, Ascend received zoning approval from the village board to operate a dispensary in the suburb, which earlier this year voted to allow one recreational dispensary as early as 2021.
“We had half a dozen cannabis companies call and inquire about opening,” Chicago Ridge Mayor Chuck Tokar told Grown In. “For a number of reasons, Ascend ascended to the top due to its financial background and ability to make the building look nice.”Ascend will occupy a former Pier One Imports location.
The Chicago Sun-Times reported earlier this week that Midway Dispensary withdrew its application to open its recreational dispensary at 1420 S. Michigan Avenue, a mile south of Chicago’s business district. That effort met resistance from the community and Chicago’s Ald. Pat Dowell, due to its proximity to an Roman Catholic elementary school, among other issues.