HOLYOKE — Trulieve Cannabis Corp. announced Thursday it expects to cease its Massachusetts operations by the end of 2023, closing its shops in Northampton, Framingham and Worcester by June 30. The move also includes the closure of its growing and processing facility in Holyoke.
The company has 128 employees in Massachusetts.
That Holyoke facility at 56 Canal St. is where Lorna McMurrey, 27, worked before dying in 2022 of breathing problems that were blamed on inhaling cannabis dust at the facility.
In December, Florida-based Trulieve paid $14,502 to the Occupational Safety and Health Administration to settle the case.
In Northampton, Trulieve opened on North King Street in 2021.
It’s part of a national retrenchment for Trulieve — a publicly held company traded on the Toronto stock exchange as TRUL — and another sign that the state’s legal marijuana market is losing its buzz.
Trulieve also said Thursday that it will close of selection of California retail assets and exit the Nevada wholesale market.
“These difficult but necessary measures are part of ongoing efforts to bolster business resilience and our commitment to cash preservation as we continue to focus on our business strategy of going deep in our core markets and jettisoning non-contributive assets,” said Chief Executive Officer Kim Rivers in a written statement. “We remain fully confident in our strategic position and the long term prospects for the industry.”
In April, cannabis company Insa laid off workers in Massachusetts citing increased out-of-state competition.
The Source, another store in Northampton, closed abruptly in December. Earlier this year, a buyer with ideas to grow marijuana pulled out of a deal to buy the former Chez Josef banquet house in Agawam after it couldn’t get financing due to market conditions.
Pleasantrees, a marijuana shop in Easthampton, has also closed this year.
Massachusetts marijuana has brought in $4.6 billion in gross sales since the first legal shops opened in 2018, and there has been $600 million in gross sales in just the first five months of 2023.
But prices are down. An ounce of flower is selling for $171 this month, according to the state Cannabis Control Commission. That’s down from more than $400 as recently as early 2021.
In Holyoke, Trulieve bought its 155-year-old mill building for $3.2 million in 2019 and announced plans to build a 126,000-square-foot growing, processing, testing and retailing operation there. Previously owned by Conklin Office Furniture, the building is one of many large old mill buildings on Holyoke’s canals that have been converted for use by the cannabis industry.
At 56 Canal St., Trulieve invested about $30 million on renovations and repairs, installing specialized equipment, said Aaron Vega, Holyoke director of planning and economic development.
A look at the building’s rear reveals new steelwork supporting Trulieve’s equipment.
At its height, the company had 100 workers there but had cut back in recent months, closing its testing lab and then much of its packaging operation.
Trulieve notified Vega Wednesday it plans to sell the 126,000-square-foot facility that includes 60,000 square feet of dedicated grow space.
“They told me they have six months to bring in another operator,” he said. “Which sounds to me like a very hard lift. It’s going to be very difficult to find someone interested in a space that large.”
Interest in locating cannabis facilities in Holyoke has slowed down with the cooling market. But the interest Vega does see is from small businesses interested in small spaces.
Ideally, he’d like to see Trulieve or someone else take over management of the building and divide up its specialized spaces and lease out the spots so small businesses can get a foothold. It would be similar, he said, to the “mall for cannabis” concept developers are building out nearby at 1 Cabot St.
“It depends on how much they are selling it for,” Vega said. “But our emphasis here in Holyoke has also been on the indoor growing of food. It might be repurposed for indoor growing of fruits and vegetables.”
Trulieve executives cited two reasons for shutting down in Massachusetts on the call with Vega. One is the overall financial reorganization. The other, he said, is Massachusetts’ strict regulations when it comes to the use of pesticides and quality.
“I’ve said it before,” Vega said. “This is the year of reckoning for the cannabis industry. There is less activity. There is certainly less activity here.”
Workers at the Holyoke plant were sent home Thursday for the day with pay.
One man on his way home who declined to give his name citing fears for his job and severance package said he loved the industry and would like to find another job in cannabis. But Trulieve — in production for just three years — was just too big. It was, he said, capable of growing enough product to supply the entire Northeast.
Where the business is now, he said, is in craft-level small growers. It’s an evolution similar to what’s been seen in the beer business in the last few decades.
H/T: www.masslive.com
