Grand Rapids-based Pharmhouse Wellness Co. has exited the Western Michigan market after selling the company’s second dispensary to a California-based brand in a deal valued at $3.5 million.
The transaction had Pharmhouse founder and CEO Casey Kornoelje heeding his own advice that cannabis operators should seriously consider any opportunity to cash out and sell their businesses at a gain, especially given the highly competitive and saturated market in the state.
In a deal that closed Sept. 10, Kornoelje sold the New Buffalo Township storefront that opened in June 2024 to an affiliate of the Backpack Boyz, a California-based cannabis brand that approached him with an offer for the location.
“I had to evaluate all of our options and do what I felt was in the best interest of the company and our family,” Kornoelje said.
New Buffalo Township is located in the southwesternmost corner of Michigan, just north of the Indiana state border. The strategic location made it attractive for cannabis operators, but the market quickly saturated with the opening of roughly 20 or more cannabis retail stores in the town with a population of about 1,700, Kornoelje said.
“We are really thankful to have been the fifth dispensary to open up down there and experience the period of robust sales growth during that time,” Kornoelje said.
Kornoele said the transaction was valued at $3.5 million, including the real estate deal and the value of the inventory transferred to Pharmhouse’s flagship Grand Rapids store.
More than two weeks later, Kornoelje said he’s still processing the sale and determining what to do with the proceeds.
“I’m considering several opportunities that are on the table to potentially redeploy the proceeds and the capital from the sale, but that could either be inside of the cannabis space or outside of the cannabis space,” Kornoelje said. “Ultimately, I’m just hopeful that the proceeds from the sale can be a springboard for bigger and better things in the future.”
Pharmhouse continues to operate the dispensary at 831 Wealthy St. SW in Grand Rapids, which opened in March 2020.
Read more at Crain’s Grand Rapids Business
