December 7, 2021 --
InvestorsHub NewsWire -- via MoneyChatsGroup
UC Asset (OTCQX:
UCASU) is moving fast in following the success path, which is
trailblazed by major exchange public companies, to make cannabis
property investment. The company announced last month that it
would apply deal structure similar to those implemented
by Power REIT(NYSE: PW). And, yesterday, it released a news
announcing that it had entered into LOI to acquire a medical
marijuana farm in Oklahoma.
It has only been two months
since the company announced to expand its portfolio into cannabis
property. Two weeks ago, the company declared that it had developed
a pipeline of deals.
According to the news release,
the property is a 4-acre medical marijuana indoor/outdoor property.
Seller claimed that operation from this property generated a gross
annual revenue of about $900,000. The sale price is only 2.4x times
of its annual revenue. Besides, seller will finance a major part of
the transaction by providing a $1.2 million, 3-year loan, which
will carry an annual interest of merely 1.8%. And, the loan has a grace period of 6
months.
UC Asset plans to lease the
property back to licensed growers, applying a business model
similar to those adopted by Power REIT (NYSE: PW).
In the past 21 months since Power REIT
started cannabis property investments using the same model, its
share price has soared from $8.45 (February 03,2020) to $63.46
(November 12, 2021), an increase of 750%.
Full text of UC Asset's news
release can be found as below.
UCASU announces LOI to acquire $2.2 mllion Cannabis Property
in Oklahoma
(Atlanta, 12/06/2021) UC Asset
LP (OTCQX:
UCASU) announces the firm has signed LOI with an Oklahoma
cannabis property owner and licensed medical marijuana grower, to
acquire its property, including all on-ground structures, for a
consideration of $2.2 million.
The property is a 4-acre
medical marijuana indoor/outdoor property. According to the seller,
operation from this property generated a gross annual revenue of
about $900,000.
Seller will finance a major
part of the transaction by providing a $1.2 million, 3-year loan,
which will carry an annual interest of 1.8%. The loan also has a grace period of 6
months.
UC Asset plans to lease the
property back to licensed growers, applying a business model
similar to those adopted by established public companies, such as
Power REIT (NYSE: PW).
"There are only a few real
estate investment companies on the public market with significant
cannabis properties in their portfolio. And some of these portfolios appear to be
very successful despite their short history. We've decided to adopt
this investment model," says Greg Bankston, managing general
partner of UC Asset.
Among the public companies
Bankston referred to is Power REIT. In February 2020, the REIT
announced expanding its portfolio in greenhouses for both food and
cannabis cultivation. In the 21 months since this announcement, its
stock price has soared from $8.45 (February 03,2020) to $63.46
(November 12, 2021), an increase of 750%. According to its most recent report, the
company's quarterly revenue achieved a 133% growth and quarterly
net income achieved a 221% growth, by June 30, 2021.
This is the first LOI signed
since UC Asset announced its plan to investment in cannabis
property investments two month ago. Last month, UC Asset declared that it has
developed a deal pipeline for cannabis property
investments.
The management confirms today
that it may sign more LOIs for potential deals in the coming
weeks.
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