While most are hedging their bets on Pennsylvania’s impending recreational legalization, industry insiders know that the real story is happening in New Jersey. According to a recent Clarus report, Pennsylvania is expected to continue building on its rapid growth that has contributed to TerrAscend’s (OTC:TRSSF) foothold as one of the fastest organic revenue growth rates in the U.S. cannabis sector thanks to the strength of its Ilera unit in Pennsylvania (PA). However, New Jersey is the market with a promising outlook as the key revenue driver over the next two years.
“Due to population density, overall population size and a prospective turn toward adult use, I think New Jersey and Pennsylvania present some of the strongest prospects in the East for sustained levels of growth,” says Greg Rochlin, CEO of Ilera Healthcare. “Given TerrAscend’s high capacity, professional operations and team in the East Coast, we are well positioned to serve our patients and communities with research-based education and high quality, consistently produced products, in compliance with the state-based regulatory guidelines.”
The Garden State is poised to be the first to legalize, with the issue a hot topic on the ballot for the next election on November 3. Widely expected to pass, it would be the most populous East Coast state to legalize at around 9 million people. Add to that the nearby metropolitan markets in Philadelphia and New York City that are anxiously awaiting legalization, and New Jersey dispensaries could effectively have a captive market of over 20 million people. Marijuana Business Daily projects a legal recreational industry in New Jersey could potentially generate $1.2 billion-$1.5 billion in annual retail sales by 2023.
At present, there are just 11 New Jersey dispensaries serving over 77,000 registered patients, with a maximum of 36 stores from existing operators. Additionally, there are only 12 vertically-integrated operators to date (including TerrAscend), with nine are up and running so far.