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Why you should care about medical marijuana

You may have thought medical marijuana was primarily a health matter or a talking point in the liberal vs. conservative debate. And while it can be those things, it is also a real estate issue. After all, the pot dispensaries have to set up shop somewhere.

In New York, that somewhere is 212 E. 14th Street, a 7,200-square-foot mixed-use residential building between Second and Third avenues in Union Square that will become Manhattan’s first medical marijuana dispensary. Columbia Care NY, one of five companies that recently received a New York state license to grow and distribute medical cannabis, has reportedly signed a five-year lease for 3,500 square feet on the ground floor and basement of the property and will store its merchandise in a secure vault.

The market value of the 1920 building, located near Stuyvesant Town, was assessed by the New York City finance department at $3.19 million for the 12-month period ending June 2014, with an estimated gross income of $278,928.

Medical marijuana, which is used to alleviate ailments including chronic pain and the nausea caused by chemotherapy, is legal in 23 states, though varying restrictions apply.

Columbia Care, an alternative health care company founded in 2013 and headed by CEO and former Goldman Sachs investment banker Nicholas Vita, will be legally authorized to hand out non-smokable medicinal marijuana as of January 1. Company spokesperson Peter Kerr was quoted as saying the atmosphere will be like a “very nice pharmacy.”

Vita told the New York Times his company would invest “double-digit millions” in dispensaries and growing facilities across New York state, including a marijuana farm in Rochester and facilities in Platttsburgh, in upstate New York, and Riverhead, on Long Island.

Just how profitable could the budding cannabis industry turn out to be?

Let’s be blunt: Industry advocates predict that U.S. retail cannabis sales are heading for a high, with the Marijuana Business Factbook saying sales could rise more than fivefold between 2014 and 2018, reaching between $7.4 billion and $8.2 billion.

The RAND Drug Policy Research Center estimates that marijuana consumption has increased by more than 30 percent between 2006 and 2010. RAND co-director Beau Kilmer has told the Wall Street Journal that current retail spending on marijuana in the U.S., including legal and illegal sales, amounts to the tens of billions of dollars, adding: “There is definitely money to be made.”

All five approved companies plan to open four dispensaries and are required to be doing business within six months. As for the commercial real estate possibilities in New York, the possibilities extend beyond Manhattan (though another Manhattan site, operated by Bloomfield Industries, is expected to open as well). According to the New York State health department and media reports, Empire State Health Solutions will be opening at the Queens Center Mall and manufacturing in Fulton County, PharmaCann will be dispensing in the Hunts Point section of the Bronx, and Etain will be both manufacturing and selling outside of the city, dispensing in Albany, Yonkers and Syracuse.

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Alex Veksler

Head of Content

Alex Veksler has 16 years of finance, data analysis and project management experience. He is a former vice president at Morgan Stanley, where he worked on product control of equity and fixed-income derivatives products as well as various projects involving finance and technology, such as revamping risk attribution and balance-sheet systems for profits and losses. Alex has previously worked at hedge funds, most recently as a director at Exigent Capital. He has a bachelor’s in computer science from Yeshiva University and an MBA from New York University.

Ely Razin

CEO

Ely Razin founded CrediFi in 2014 with Battery Ventures. A rare combination of seasoned corporate executive and technology entrepreneur, Ely previously served as global head of board governance for Thomson Reuters Accelus and head of business law for Thomson Reuters, after the software company he founded was acquired in 2004. The company, Expert Ease Software, developed AI-based software that automatically summarizes key deal terms for transactions in fields including capital markets, M&A and real estate. Ely began his career as a corporate and securities lawyer, and holds an LLB and MBA from York University.

Frank Muhlon

Head of Transactions

Frank Muhlon oversees CredifX, the commercial real estate financing marketplace that mines the CrediFi database at its core. Prior to joining CrediFi, Frank served as vice president of Northeast region business operations for online CRE property trading platform Ten-X, which has closed over $40 billion in transactions since its inception. He has also held key positions at Orix USA/Houlihan Lokey, Silverstein Properties and Trammell Crow Company. Frank received his master’s degree in real estate finance from New York University and his bachelor’s in finance from Rutgers University.

Charles Mctiernan

Head of Sales

Charles Mctiernan comes to CrediFi from Ned Davis Research Group and Roubini Global Economics, where he was the global head of sales. He also spent more than 10 years at Reuters America Holdings, where he held a number of senior sales leadership roles, including head of solutions sales and head of global accounts. Charles, who received his bachelor’s in economics from East Carolina University, has more than 25 years of experience in technology, data and research sales.

Amichai Levy

VP R&D

Amichai Levy is the former VP of R&D at Israeli high-tech firm Payoneer, where he developed its signature cross-border payment platform and integrated it with existing bank technology. In his prior role at Ness Technologies, Amichai was a key player in developing an electronic case filing system for Israel’s courts. He has over 20 years of experience in software engineering.

David Fajgman

Head of Finance

David Fajgman brings over 14 years of financial and managerial experience to CrediFi. Prior to joining the CrediFi team, he served as finance director of Bioness Neuromodulation Ltd., which develops and manufactures medical devices involved in neurological rehabilitation. He has previously worked in multiple finance roles at Thomson Reuters and as an accounting and consulting manager at Ernst & Young, where he was responsible for a wide range of clients, including companies listed on the Nasdaq and privately held high-tech companies. David is an Israel-licensed certified public accountant and has a bachelor’s degree in business and accounting.

Liat Bar David

Head of Human Resources

Liat Bar David has over nine years of human resources experience, primarily focused on the high-tech industry. She is a former HR business partner at semiconductor solutions provider Broadcom, where she was responsible for onboarding processes, benefits, policies, training and development, performance management and employee retention. Liat holds a bachelor’s in communication and human services and a master’s in human resources and services, both from the University of Haifa.