AirBud-n-B? Cannabis’ Foray into the Hospitality Industry

As states around the country continue to liberalize cannabis rules, an increasing number of industries are transitioning into the market — and the next on the horizon may be the hospitality industry. 

Not surprisingly, Colorado — and more specifically the city of Denver — are providing the clearest glimpse of what that expansion may look like.  Effective January 1, 2020, Colorado state law allows licenses for cannabis “hospitality” businesses where cannabis can be consumed on premises. Beginning July 1, 2021, the Denver Marijuana Code authorizes “Marijuana Hospitality Businesses,” which allows for “the on-premises consumption of marijuana at either a fixed location or mobile premises.” It also authorizes “Retail Marijuana Hospitality and Sales Business Licenses.” Simply put, there are three types of such licenses: (1) hospitality, where customers can consume cannabis inside of the establishment; (2) hospitality and sales, where customers can consume cannabis inside of the establishment and also purchase small amounts of cannabis; and (3) mobile hospitality, where customers can consume cannabis on a tour bus. There are, however, a number of restrictions, including proximity to other businesses, and restrictions on routes for mobile cannabis hospitality.

In November of 2021, Denver began accepting applications for a new marijuana hospitality program. The first business to apply for a license is a historic (and apparently haunted) hotel. So far, three businesses are listed as “Cannabis Hospitality businesses” on Colorado’s state website. Although the licenses that have been granted thus far are limited, one can easily imagine the possibilities. Eco-tourism on a cannabis farm? Maybe. A cannabis-infused meal at a Michelin starred restaurant? Perhaps. Or what about a cannabis party bus, akin to the “transportainment” that is taking over cities such as Denver, Nashville, and Austin?

While widespread cannabis hospitality may be years in the future for most states, other states, including Nevada, have passed similar laws. Given the extraordinary growth in the cannabis sector in recent years, all hospitality players will, sooner or later, be forced to address the question of how to address cannabis. Many will embrace the evolution and almost certainly reap benefits from doing so. But even those wishing to avoid cannabis will need to adopt policies and procedures for ensuring that remains the case.

We will stay apprised of the budding cannabis hospitality industry and continue to provide updates as the situation unfolds, almost certainly sooner rather than later.

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Bradley's Food, Beverage and Hospitality team understands the unique challenges and needs of these dynamic and competitive industries. From national restaurant chains to craft breweries and from wine and beer distributors to hotel, resort, and club properties, our multidisciplinary team counsels food, beverage and hospitality industry clients on all aspects of the hospitality industry.

Bradley’s Cannabis Industry team is a leading voice in the cannabis sector. The National Law Review recognized our team as a “Go-To Thought Leader” for Cannabis Industry Regulation in 2021. Our attorneys have presented on cannabis issues at conferences around the country and have been quoted in an array of legal and mainstream publications, from Law360 and Westlaw Journal to the Atlanta Journal-Constitution, the Associated Press, and ABC News.