Michigan · Cannabis · Q3 2026
Michigan cannabis real estate market report — Q3 2026
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Key findings
- Active licences fell for the first time since 2019 — 2,171 at the end of 2025, a net decline of 85.
- Retail count moved 848 (2024) → 838 (2025); growers are down 12 and processors down 5 since 31 May 2026.
- H1 2026 sales were $1.486 billion, but June ($253.1M) came in 1.9% below May ($258.0M).
- Average adult-use flower fell to $58.18 per ounce in June 2026, from $59.73 in May.
The short answer
Michigan's cannabis market is consolidating. 838 active adult-use retailers, 935 growers and 270 processors were licensed as of July 2026, against $1.486 billion in first-half sales and falling flower prices. A 24% wholesale tax took effect 1 January 2026. Real estate follows: distressed cultivation is trading, green-zone retail is not.
Summary
Key findings
- Active licences fell for the first time since 2019 — 2,171 at the end of 2025, a net decline of 85.
- Retail count moved 848 (2024) → 838 (2025); growers are down 12 and processors down 5 since 31 May 2026.
- H1 2026 sales were $1.486 billion, but June ($253.1M) came in 1.9% below May ($258.0M).
- Average adult-use flower fell to $58.18 per ounce in June 2026, from $59.73 in May.
- The 24% wholesale tax, effective 1 January 2026, is projected to raise roughly $420.7 million annually and is under challenge in the Court of Claims.
- FY2025 distributed $93,773,685.60 at $54,017.10 per licensed retail store or microbusiness.
- TerrAscend's Michigan estate entered receivership on 6 May 2026 with $6.8 million in payables against $5.2 million in assets.
Licensing: the first contraction since legalisation
- 838
- Active adult-use retailers
- 935
- Active growers
- 270
- Active processors
- 2,171
- Total active licences, year-end 2025
July 2026
Michigan Cannabis Regulatory Agency · as of
Class A 9 · Class B 65 · Class C 800 · Excess 61
Michigan Cannabis Regulatory Agency · as of
July 2026
Michigan Cannabis Regulatory Agency · as of
Net decline of 85 — first drop since 2019
Michigan Cannabis Regulatory Agency · as of
Michigan ended 2025 with 2,171 active licences, a net decline of 85 and the first annual drop since 2019. That single number reframes every underwriting assumption built during the expansion years. A market that adds licences absorbs marginal buildings; a market that sheds them returns those buildings to the general industrial pool, usually with cultivation improvements nobody else wants to pay for.
Cultivation carries the contraction. The July 2026 grower count of 935 splits as 9 Class A, 65 Class B, 800 Class C and 61 Excess Grower licences — an overwhelmingly Class C market, which is to say a market of 2,000-plant operations built for wholesale volume in a wholesale price collapse.
Retail is comparatively stable and quietly shrinking: 848 stores in 2024 became 838 in 2025, and the count was still 838 in July 2026. Processors stand at 270. Since 31 May 2026 alone, growers are down 12 and processors down 5. Two counts, not a rate: 848 stores in 2024 and 838 in 2025. Against that, the licence base as a whole fell by 85 in 2025 — the first annual decline since 2019 — and the recent losses are concentrated in cultivation and processing. That is where the real estate risk sits.
Michigan adult-use licence counts, July 2026
| Licence class | Active count | Plant or scope limit | Direction since 31 May 2026 |
|---|---|---|---|
| Grower Class A | 9 | 100 plants | Growers down 12 in aggregate |
| Grower Class B | 65 | 500 plants | Growers down 12 in aggregate |
| Grower Class C | 800 | 2,000 plants | Growers down 12 in aggregate |
| Excess Grower | 61 | Additional 2,000-plant increments | Growers down 12 in aggregate |
| Processor | 270 | Extraction and manufacturing | Down 5 |
| Retailer | 838 | Adult-use retail sale | Flat |
Source: Michigan Cannabis Regulatory Agency — licensing and sales disclosures · Figures as of
Sales and pricing: volume holding, price still falling
- $1.486B
- H1 2026 total sales
- $253.1M
- June 2026 sales
- $16.51B
- Cumulative sales since December 2019
- $58.18 / oz
- Average adult-use flower
- $76.91 / oz
- Average medical flower
- 339,133.97 lbs
- Q2 2026 adult-use flower volume
$1.484B adult-use · $2.2M medical
Michigan Cannabis Regulatory Agency · as of
Down 1.9% from May's $258.0M
Michigan Cannabis Regulatory Agency · as of
Michigan Cannabis Regulatory Agency · as of
June 2026 · April $59.05 · May $59.73
Michigan Cannabis Regulatory Agency · as of
June 2026
Michigan Cannabis Regulatory Agency · as of
Michigan Cannabis Regulatory Agency · as of
Michigan sold $1.486 billion of cannabis in the first half of 2026 — $1.484 billion adult-use against $2.2 million medical, which is now a rounding error in a market that began as a medical programme. Cumulative sales since the December 2019 launch reached $16.51 billion.
The monthly series is where the direction shows. June 2026 recorded $253.1 million, down 1.9% from May's $258.0 million. Average adult-use flower was $58.18 per ounce in June, having run $59.05 in April and $59.73 in May. Medical flower held a premium at $76.91 per ounce on negligible volume. Adult-use flower volume in Q2 2026 was 339,133.97 pounds.
Flat-to-declining revenue on rising volume is a price problem, not a demand problem, and it lands on cultivation real estate first. A Class C building underwritten at 2021 wholesale pricing does not clear debt service at 2026 wholesale pricing, whatever the tenant's operating discipline.
The 24% wholesale tax
- 24%
- Wholesale tax rate
- ≈$420.7M
- Projected annual collection
Effective 1 January 2026, atop 10% excise and 6% sales tax
Michigan Department of Treasury · as of
Michigan Department of Treasury · as of
A 24% wholesale tax took effect on 1 January 2026, layered on top of the existing 10% excise tax and 6% sales tax. Projected annual collection is approximately $420.7 million. The Michigan Cannabis Industry Association filed suit in the Court of Claims on 7 October 2025; the challenge was pending as of this report.
The tax attaches at wholesale transfer, which means vertically integrated operators and standalone cultivators experience it differently — and that difference is a real estate question. It raises the value of holding cultivation and retail under common control, which is why we expect the acquisition bid for distressed grow assets to come disproportionately from existing retailers rather than from new cultivation entrants.
Treasury publishes quarterly wholesale price guidance that sets the taxable base where an arm's-length price is absent. The Q3 2026 schedule is below; it is also the closest thing Michigan has to an official wholesale price index, which makes it useful well beyond tax compliance.
Michigan Treasury wholesale price guidance, Q3 2026
| Product | Guidance price |
|---|---|
| Flower | $641.41 / lb |
| Shake / trim | $349.82 / lb |
| Concentrate | $2,042.73 / lb |
| Vape cartridge | $2,329.67 / lb |
| Kief | $818.65 / lb |
Source: Michigan Department of Treasury — marihuana wholesale price guidance, Q3 2026 · Figures as of
Municipal distributions: what a licence is worth to a city
- $93,773,685.60
- FY2025 total distributed
- $54,017.10
- Per licensed retail store or microbusiness
- $46,886,842.80
- To municipalities
- $46,886,842.80
- To counties
- 868
- Qualifying licences
Michigan Department of Treasury · as of
Michigan Department of Treasury · as of
Michigan Department of Treasury · as of
Michigan Department of Treasury · as of
238 municipalities · 79 counties · 4 tribes
Michigan Department of Treasury · as of
FY2025 distributed $93,773,685.60 from the Marihuana Regulation Fund — $46,886,842.80 to municipalities and an equal $46,886,842.80 to counties. The per-licence figure was $54,017.10 for each licensed retail store or microbusiness, across 868 qualifying licences, 238 municipalities, 79 counties and 4 tribes.
$54,017.10 per store per year is the single most useful number in a municipal conversation. A city holding five stores collects roughly $270,000 annually with no capital outlay and no service obligation. That arithmetic is why opt-out ordinances keep getting revisited, and it is the argument that actually moves a council — not tax theory, a line item.
It also disciplines the other direction. A municipality that caps at three stores is choosing roughly $162,000 a year, and knows it. Cap decisions are increasingly explicit revenue decisions, which makes them more predictable to underwrite than they were three years ago.
Distress: the TerrAscend receivership
- 6 May 2026
- Receivership order
- $210M
- Underlying default
- 20 dispensaries + 4 cultivation / processing
- Estate footprint
- $6.8M vs $5.2M
- Michigan payables vs assets
Oakland County Circuit Court
Oakland County Circuit Court receivership order, In re TerrAscend Michigan (6 May 2026) · as of
FocusGrowth
Oakland County Circuit Court receivership order, In re TerrAscend Michigan (6 May 2026) · as of
Oakland County Circuit Court receivership order, In re TerrAscend Michigan (6 May 2026) · as of
As of 7 May 2026
Oakland County Circuit Court receivership order, In re TerrAscend Michigan (6 May 2026) · as of
The clearest distress event of the period is TerrAscend's Michigan estate. An Oakland County Circuit Court receivership order issued 6 May 2026 following a $210 million default to FocusGrowth. The estate covers 20 dispensaries and four cultivation and processing facilities. As of 7 May 2026, the receiver reported approximately $6.8 million in Michigan payables against $5.2 million in assets. Lume is acquiring three former Gage locations out of the estate.
A receivership is not a fire sale, and buyers who treat it as one lose the asset. The receiver's duty runs to the estate, which means a clean, funded, quick-closing offer beats a higher offer with financing and licence-transfer contingencies. Cannabis adds a second clock: the licence sits with the operating entity and the CRA must approve the transfer, so the real timeline is the regulatory one, not the court one.
Payables exceeding assets tells you the tenant improvements will not be replaced by the estate. Anything a buyer needs — HVAC, sealed rooms, C1D1 extraction infrastructure, three-phase service upgrades — is a buyer cost, and it should be priced as one at the offer, not discovered at inspection.
Policy watch
- 7 October 2025
- MCIA challenge filed
- In committee
- Statewide cap bill
- 544 F. Supp. 3d 804
- Lowe v. City of Detroit
Michigan Court of Claims — pending
Michigan Cannabis Industry Association v. State of Michigan, Michigan Court of Claims (filed 7 October 2025) · as of
Sen. Sam Singh — not enacted as of 24 August 2026
Michigan Legislature · as of
E.D. Mich. 2021 — preliminary injunction against Detroit's legacy preference
Lowe v. City of Detroit, 544 F. Supp. 3d 804 (E.D. Mich. 2021) · as of
A Senate bill introduced by Sen. Sam Singh proposing a statewide adult-use licence cap remains the largest single variable in Michigan cannabis real estate. A cap converts a licence from a renewable permission into a finite asset, and that revalues every green-zone parcel in the state overnight. We do not model an outcome, and no one should underwrite one; we track the bill's status on the Legislature's own record and tell clients what each branch does to their basis. As of 24 August 2026 the bill sits in committee and has not been enacted.
On Detroit, the arithmetic circulating in trade coverage has repeatedly been wrong, and we correct it on our municipality page rather than repeat it here. Detroit's licence structure, its equity provisions and its litigation history — Lowe v. City of Detroit, 544 F. Supp. 3d 804 (E.D. Mich. 2021), in which the court enjoined enforcement of Detroit's legacy-resident preference in adult-use licensing, foremost — mean the city's effective store count and its ordinance ceiling are different numbers, and conflating them produces a market read that is off by a wide margin.
The MCIA challenge to the wholesale tax is the other live branch. A successful challenge restores roughly $420.7 million a year to operator margin, most of which lands in cultivation, which is exactly where the distressed real estate is.
C3's interpretation
What this means if you are buying, selling or leasing
This section is C3 CRE's own read. It is not a restatement of any third party's report, and it is the part we are accountable for.
For buyers of cultivation: the bid should be set from the building's conventional industrial value plus only the cultivation improvements you will actually use. Class C supply is 800 licences deep in a falling price market; there is no scarcity premium in a 2,000-plant grow building right now, and paying one is the most common error we see.
For sellers of retail: a licensed, operating store in an opted-in municipality with a cap is the strongest asset in the state, and the $54,017.10 municipal distribution is why the cap will not loosen. Sell the licence position and the municipal relationship, not the square footage.
For landlords: the 24% wholesale tax compresses tenant margin at exactly the point in the chain where your cultivation tenants sit. Underwrite the rent against post-tax operator economics, and expect more restructure requests from Class C tenants than from retail tenants over the next four quarters.
For occupiers and conventional industrial buyers: the contraction is your opportunity. Former grow buildings come with heavy power, upgraded HVAC and hardened envelopes, and they trade below replacement cost because the cannabis bid has thinned. Several of the best conventional industrial values in Michigan right now are former cultivation.
Where this report reads beyond the cited figures, the basis is C3 CRE's own Michigan and Tampa Bay transaction experience, not a published dataset.
Next quarter
What we're watching next quarter
- Whether the Q3 2026 CRA disclosures show the grower count breaking below 900 — the level at which we would call the contraction structural rather than cyclical.
- The Court of Claims docket in the MCIA wholesale tax challenge, and whether any interim relief issues before the FY2027 budget.
- Movement on the Singh statewide cap bill out of committee, and any municipality that revises its cap in anticipation of one.
- Disposition pricing out of the TerrAscend estate, which will set the first genuinely public comparable set for Michigan dispensary real estate.
- Whether the retail count holds at 838 or resumes the 848 → 838 decline, which determines whether green-zone retail rents can hold.
- FY2026 Marihuana Regulation Fund distributions, and whether the per-licence figure moves off $54,017.10.
Labelled clearly
Data we don't yet publish
The number this market most needs and nobody has is the green-zone versus non-green-zone asking spread: what the same industrial building asks per square foot inside a municipality's cannabis overlay against an otherwise identical building outside it, held constant for county, size, clear height and power service.
That number cannot be scraped. It requires knowing which parcels actually sit inside an overlay after setbacks are applied, which asking prices are real and which are aspirational, and which buildings traded at the ask. Only a broker who works these deals can assemble it, and we are assembling it.
We are not publishing a partial version. Until the sample is large enough to be honest about — and until we can state the county, size band and date range it covers — this section says what we are building rather than showing a number we would not underwrite on ourselves.
Sources
Where these figures come from
- Michigan Cannabis Regulatory Agency — licensing and sales disclosures · figures as of
- Michigan Department of Treasury — marihuana wholesale price guidance, Q3 2026 · figures as of
- Michigan Department of Treasury — Marihuana Regulation Fund FY2025 distributions · figures as of
- Oakland County Circuit Court receivership order, In re TerrAscend Michigan (6 May 2026) · figures as of
- Michigan Cannabis Industry Association v. State of Michigan, Michigan Court of Claims (filed 7 October 2025) · figures as of
- Michigan Legislature — Senate bill introduced by Sen. Sam Singh proposing a statewide adult-use licence cap (status: in committee) · figures as of
- Lowe v. City of Detroit, 544 F. Supp. 3d 804 (E.D. Mich. 2021) · figures as of
Every figure on this page carries a named source and an effective date. Where the reading rests on C3 CRE's own transaction experience rather than a published dataset, it is disclosed as such rather than presented as data.
Questions
Michigan cannabis — Q3 2026 — questions we get asked
- How many cannabis licences are active in Michigan?
- As of July 2026 the Cannabis Regulatory Agency reported 838 active adult-use retailers, 935 growers and 270 processors. Total active licences stood at 2,171 at the end of 2025, a net decline of 85 and the first annual drop since 2019.
- Is the Michigan cannabis market shrinking?
- By licence count, yes. Michigan ended 2025 with 2,171 active licences, a net decline of 85 and the first annual drop since 2019. Retail moved from 848 stores in 2024 to 838 in 2025, and between 31 May and 23 July 2026 growers fell by 12 and processors by 5. Sales volume is holding — $1.486 billion in H1 2026 — while price falls.
- What is Michigan's 24% cannabis wholesale tax?
- A 24% tax on wholesale cannabis transfers effective 1 January 2026, layered on the existing 10% excise and 6% sales tax, projected to raise about $420.7 million annually. The Michigan Cannabis Industry Association filed a challenge in the Court of Claims on 7 October 2025.
- How much cannabis tax revenue does a Michigan municipality receive per store?
- $54,017.10 per licensed retail store or microbusiness for FY2025, from a total distribution of $93,773,685.60 split evenly between municipalities and counties across 868 licences, 238 municipalities, 79 counties and 4 tribes.
- What happened in the TerrAscend Michigan receivership?
- An Oakland County Circuit Court receivership order issued 6 May 2026 after a $210 million FocusGrowth default, covering 20 dispensaries and four cultivation and processing facilities. As of 7 May 2026 the estate reported $6.8 million in Michigan payables against $5.2 million in assets, with Lume acquiring three former Gage locations.
- Who publishes Michigan cannabis real estate research?
- Effectively nobody else. CBRE, JLL, Cushman & Wakefield and Marcus & Millichap exclude cannabis from institutional research coverage, and the regional Michigan brokerages do not cover it. C3 CRE publishes this quarterly from Cannabis Regulatory Agency, Treasury and court-record sources.
The rest of the series
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