In early June, it was announced that Zoned Properties had negotiated new base rental rates for two Arizona operations after finalizing a set of lease amendments with its ?Significant Tennant.?? The company?s changes are expected to result in substantial investment in the state and further economic expansion in Tempe and Chino Valley.
Who are Zoned Properties?
According to its website, Zoned Properties “is a strategic real estate development firm whose primary mission is to provide real estate and sustainability services for clients in the regulated cannabis industry.? Zoned Properties does not grow, harvest, sell, or distribute cannabis or any substances regulated under United States law.
According to the announcement, Zoned Properties owns these properties without debt. It has been reported that the company?s ?Significant Tenant? has committed to invest at least $8 million in capital for property infrastructure improvements and expansion in Tempe and Chino Valley. According to SEC data, Zoned Properties has leased commercial properties and made recent amendments to leases with CJK, Inc. in Tempe and Broken Arrow Herbal Center, Inc. in Chino Valley.
The lease amendments have established a new rental rate for the tenants and added market-standard terms for both parties. With the completion of the planned expansions, the lease agreements are estimated to yield over $30 million in rental cash flow over the life of lease terms. The leased properties are expected to be increased by up to 225,000 square feet of operational capacity.
Bryan McLaren, Chief Executive Officer of Zoned Properties, stated that ?The lease amendments, capital investment by our tenant, and continuing property expansion mark the successful execution of a strategic positioning process for our Arizona property portfolio to create value for our shareholders and stakeholders.? Mr. McLaren also commented that ?We believe this is a win-win scenario, in which we have negotiated a healthy base rental rate for our significant tenant that will allow for competitive growth, increased operational capacity, and increased rental revenue and cash-flow for Zoned Properties. We expect this to meaningfully improve the health of our balance sheet, increasing the tangible value of our company.
Laura B. Bramnick is an Arizona real estate attorney with the knowledge and experience to protect your interests during every stage of your real estate matter. If you are seeking an exceptional, client-driven real estate lawyer in Scottsdale, Phoenix, Sedona, and throughout the State of Arizona, contact Laura B. Bramnick to schedule your consultation.