Dispensary desert no more: Broomfield opens 1st pot shops

BROOMFIELD — Nearly a decade into Colorado’s legal cannabis journey, a notable dispensary desert has existed between the highly concentrated cannabis markets in Denver and Boulder counties. That will soon change as Broomfield is set to welcome its first cannabis businesses. 

Voters statewide approved measures paving the way for recreational dispensaries in 2012 with the first weed stores coming online in 2014.

At that time Broomfield leaders opted out of the industry, which brought in more than $400 million in new tax revenue last year. 

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“Broomfield really cares about its community members and always has,” Dan Martin, Broomfield native and co-founder of the Magnolia Road dispensary group, told BizWest. “It’s been a really great place to live and to raise a family. I can see why Broomfield was really cautious and took its time to see what effects cannabis [legalization] had in other jurisdictions. What it saw was that the impact wasn’t negative, in fact it’s been more beneficial.”

Last year, the Broomfield City Council reversed course on cannabis business prohibition and, on a 9-1 vote, approved a set of measures that paved the way for both medical and recreational pot shops to open in the city. 

Initially, three licenses were approved, with two additional licenses to be granted next year.  Each of the licenses will be granted to different operators. 

Annual tax revenue from the five dispensaries is expected to exceed $1.1 million, according to Broomfield staff estimates. 

Despite city officials’ change of heart regarding prohibition, the process to get across the finish line and open the dispensaries has been a rocky road. 

Last September, a Boulder cannabis dispensary operator sued Broomfield’s city and county clerk and a handful of other pot sellers, alleging that multiple applications to open pot shops were submitted by the same companies in violation of Broomfield regulations. 

Terrapin Care Station, through holding company Centroid Holdings Inc., claimed that Broomfield city and county clerk Erika Lew had undermined the “fairness of proceedings” in the city’s application and lottery system used to select the three dispensaries that will be allowed to open up shop in Broomfield. 

The lawsuit, which has since been dropped, contended that city ordinance prohibits any individual or company from submitting more than one application.

“While the formal legal names of the entities through which they applied differ, the applications themselves clearly demonstrated that businesses and individuals created multiple entities and submitted applications through each of them,” according to the complaint.

In effect, the multiple submissions would increase the likelihood that one of the defendants’ applications would be selected during the lottery process.

City officials, according to correspondence provided to BizWest, said they were “‘aware of the concern,’ but that Broomfield did not ‘agree that this concern constitutes grounds for the city and county clerk to change the status of any applications that were accepted by the office as complete, and their status at this stage will not be changed.’”

The city abandoned that position in October 2021 and paused the process of licensing to reevaluate its procedures. 

“We turned in a single application for our building, and I think we had a lot of the same concerns others had,” Martin said. But I’m happy about how Broomfield went about” addressing concerns during the license processing pause.

Ultimately, new procedures were adopted to ensure that one application per business was accepted, and Magnolia Road, Buena Suerte Co. and LivWell XIV LLC were granted licenses in February.

Martin said his company had missed on winning lotteries in other cities granting new licenses and wanted to be sure he was in position to take advantage of Broomfield’s changing rules on dispensaries.

Several years ago, a commercial property on Midway Boulevard became available, and Martin jumped on the chance to purchase it.

“Since we first started Magnolia Road, we talked about having a store in Broomfield if it ever allowed it,” he said. “… I’m from Broomfield. My dad [and business partner] grew up here and I grew up here and raised my family here.”

Since dispensaries were still banned at the time, the Midway Boulevard location was used as administrative offices for Magnolia Road, which operates pot shops in Boulder and Trinidad.

“It worked out really well for us,” Martin said of winning the lottery and being permitted to open up shop in his hometown.

Martin’s state license is being processed, and he’s begun working with contractors to build out the Broomfield space with the hope of opening in late summer or early fall.