Understanding Risks for Landlords of Cannabis Dispensaries

Landlords in New York City who knowingly rent commercial spaces to illicit marijuana dispensaries may now be subject to fines, with penalties reaching up to $10,000, following the recent approval of legislation by the City Council. The bill, championed by Lynn Schulman (D-Queens), marks a significant shift in enforcement focus. It mandates that city authorities issue formal warnings to landlords when tenants engage in unlicensed Cannabis Dispensaries.

Presently, New York City hosts six legally operating cannabis dispensaries. Under this legislation, landlords who fail to initiate eviction proceedings against illegal pot shops after their tenants receive penalties face fines of $5,000 for initial offenses and $10,000 for subsequent violations.

Additionally, for first-time offenses where the landlord has not commenced eviction proceedings, fines amounting to $1,000 are applicable. The city currently grapples with over 1,500 illegal marijuana shops.

Mayor Eric Adams and Governor Kathy Hochul are striving to combat the widespread issue of illicit pot shops by directing intensified enforcement efforts against sellers, with a newfound emphasis on holding landlords accountable for their role in facilitating these operations. If the City Council ignores these illegal dispensaries, it would subvert the new licensing procedures and the screening of prospective operators. Illegal Pot Shops would also deprive community boards of their to give feedback on cannabis dispensaries licenses.

Landlords who would like to discuss their potential liability can contact the Wright Law Firm at (212) 619-1500.

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