Rental Housing Journal Metro
July 2014
2. Multifamily NW – “I just do maintenance”
12. Dear Maintenance Men 14. Shoptalk
4. President’s Message: A Landlord's Summer
15. Knowing the Limits on Collection Practices for Property Managers
6. Thoughts on Being a Successful Landlord
16. The Coach - Can Your Rental Center Walls…Sell?
9. How Entrepreneurs Can Increase Profit with a Hands-Off Approach 10. Responding to Maintenance Emergencies
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Published in association with: METRO Multifamily Housing Association; Rental Housing Association of Oregon; IREM & Clark County Rental Association
Market Overview Portland Oregon Multifamily Housing Update 1Q14 RED CAPITAL GROUP®
Understanding Oregon Medical Marijuana Dispensary Tenants By Cliff Hockley and Special Contributors Jacob Zahniser and Chris Walters building owner asked to lease to a marijuana dispensary is faced with a host of complex legal considerations unique to marijuana dispensary tenants. This arises from the inconsistent state of play between federal, state, and local regulators: • Marijuana remains a controlled substance under federal law. • Oregon law permits dispensaries, subject to licensing and other requirements. • Oregon cities have the right to prohibit dispensaries within their jurisdiction. This article summarizes the key considerations a building owner must keep in mind when thinking about leasing to a dispensary. The Legal Morass Federal Law The sale of medicinal marijuana is illegal under federal law and marijuana remains a federally controlled substance. As long as marijuana remains a federally controlled substance, there will always be a risk that federal law enforcement will shut down a dispensary and potentially seize the premises. The U.S. Department of Justice, however, has stated that federal prosecution will occur only when the sale of medicinal marijuana touches on one of the following: 1. The distribution of marijuana to minors 2. Revenue from the sale of marijuana goes to support criminal
A Payroll Job Summary Total Payrolls 1.043.8m Annual Change 28.0m (2.8%) 2014 Forecast 22.8m 2015 Forecast 18.1m 2016 Forecast 17.9m 2017 Forecast 12.4m Unemployment 6.1% (May) 1Q14 Payroll Trends and Forecast Notwithstanding the sharp drop in 1Q14 GDP, Rose City job creation trends were buoyant, as employers added workers to payrolls at a 28,000- job, 2.8% year-on-year rate; the fastest growth observed since 3Q06. Every sector save transportation made a positive contribution, led by construction, retail trade and business and leisure services, which collectively expanded at a 19,900job, 5.0% year-on-year pace. Seasonally-adjusted data also painted a bright picture. This series reveals that Portland establishments created a net of 12,100 new positions during the three-month period ended in April, the largest such job gain recorded in ten years. RCR analysis finds that Portland job growth is closely correlated to U.S. payroll and metro personal income growth rates and lagged S&P 500 investment returns. A 96.0% continued on page 7 Professional Publishing Inc. PO Box 6244 Beaverton, OR 97007
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organizations, gangs, and cartels 3. The diversion of marijuana from states where it is legal in some form under state law to other states where it is illegal 4. State-authorized marijuana activities being used as a cover for trafficking other illegal drugs or engaging in other illegal activities 5. The use of firearms or violence in the cultivation and distribution of marijuana 6. The exacerbation of other adverse public health consequences associated with marijuana use such as driving under the influence 7. Growing marijuana on public lands and the attendant public safety and environmental dangers posed by marijuana production on public lands 8. Marijuana possession or use on federal property Civil Forfeiture If federal law enforcement steps in to shut down the dispensary, it may also seek to take the premise through civil forfeiture laws. Under federal and state civil forfeiture law, the government has the authority to seize property used to commit a crime, even if the owner of the prop-
erty is not charged with, or convicted of, a crime. As long as the property itself is linked to the criminal activity, it may be seized. Typically, the government first seizes the property and then builds its case as to whether the property should be forfeit. This can take months or years before the forfeiture is final, during which time the building owner is deprived of any revenue from the property. Consequently, while the threat of federal law enforcement is mitigated when a dispensary is operated in compliance with state law, the risk associated with federal law enforcement remains very real (and very high), especially considering that federal enforcement policy may change with a new administration. State Law A building owner would be wise to include terms in the lease that mandate the tenant to provide the owner with documentation of compliance with all state requirements. For example, the premises cannot be within 1000 feet of a school or another dispensary, it must be equipped with an alarm system and video monitoring, and the dispensary tencontinued on page 10
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