Manhattan Cannabis Consumption Lounge and Dispensary Halted Over 1,000-Foot Rule

The famed Nat Sherman Townhouse is due for a revival.  For those unaware of its history, Nat Sherman was a line of cigars that were sold out of the Nat Sherman Townhouse on 42^nd Street in Manhattan for almost 90 years. The storefront permanently closed in the midst of the pandemic in September 2020.

Recent conditional adult use retail dispensary (“CAURD”) licensees the Polanco Brothers, have sought to open a dispensary and consumption lounge in the Nat Sherman Townhouse – a prime location for any store, let alone a licensed dispensary and lounge.

However, the brothers have been denied their application by the Office of Cannabis Management (the “OCM”) because of the 1,000-foot rule.  A quick refresher, the 1,000-foot rule was part of the OCM’s guidance for adult-use retail dispensaries and states in part:

Unless explicitly approved otherwise by the Office, a dispensary cannot be located anywhere within a certain radius of another premises that is already licensed as an adult-use retail dispensary or is a medical cannabis dispensing facility operated by a registered organization (RO). The size of that radius depends on the population of the city, town, or village that the new dispensary will be located in and is based upon the most recent American Community Survey (ACS) 5-year estimate of that municipality’s population.

In short, in a city the size of Manhattan, no dispensary can operate within 1,000 feet of an existing dispensary (among a multitude of other restrictions, i.e., near schools or places of worship).

Unfortunately, OCM determined that the proposed dispensary is within 1,000 feet of the medical cannabis store MedMen on 5^th Avenue. Depending on how you measure distance, the proposed dispensary is approximately 990 feet from MedMen. If you walk the distance, however the stores are easily over 1,000 feet apart.

OCM’s guidance determined that the calculation for distance for the 1,000-foot rule is that the measurement will be taken in a straight line from the center of the nearest entrance of the existing dispensary to the center of the nearest entrance of the premises that the licensee wishes to locate the new dispensary at.

By that logic, the Nat Sherman Townhouse is less than 1,000 feet away, and would violate the OCM’s regulations. However, OCM’s guidance specifically provides that the OCM may grant an exception, which the Polanco Brothers hope the OCM will grant in short order.

As it stands now, the Polancos have put in a request with the OCM for a waiver to allow them to open in this location and are waiting on an answer. A spokesperson said the approval is being held up right now on an unofficial technicality.

Stay tuned to the Canna Law Blog and our New York coverage for updates.