Pelorus Capital Group today announced the launch of the Pelorus Growth Fund, an investment fund structured and designed specifically to invest in cannabis operating businesses equipped to "capitalize on the consolidation wave in the industry."
The Growth Fund, which is an offering up to $1 billion in capital, will build off Pelorus’ experience lending to businesses in the cannabis industry and complement the existing Pelorus Fund, a private mortgage real estate investment trust structure offering a range of transactional solutions.
Pelorus has seeded the Growth Fund with a portfolio of cannabis-use business assets secured through and spun out of current Pelorus real-estate investments. The firm said it will partner with management teams to both run and repurpose assets.
“The launch of the Growth Fund signals the next stage of both our evolution at Pelorus and the evolution of the wider cannabis industry,” said Dan Leimel, Chief Executive Officer at Pelorus. “As we have invested in and partnered with businesses in the cannabis sector over the past ten years, we have witnessed firsthand how even the best companies with leading assets and management teams have been severely impacted by broader market compression. Despite these conditions, best-in-class companies in the sector have and will continue to find ways of operating profitably and growing sustainably. Looking ahead, we believe we are entering a generational opportunity in the market’s maturation, driven by a number of factors including [the potential / recent Federal rescheduling and] significant debt maturities due in the industry in 2026. Our deep experience as a lender in this space provides us the insights and understanding to capitalize on that opportunity, positioning us to identify the strongest businesses and actively reposition underperforming assets for the benefit of our LPs.”
“We are excited to launch the Pelorus Growth Fund at such an opportune time in the market,” said Rob Sechrist, President at Pelorus. “As the industry continues to evolve, leading cannabis businesses are positioned to build as much customer loyalty as successful alcohol brands, presenting a truly extraordinary opportunity across for investment across the sector. With this one-of-a-kind equity approach to cannabis investing, combined with our leading proprietary dataset, lasting track record of underwriting the industry and ability to understand what has been effective in leading workouts of underperforming assets, we are uniquely qualified to not only to pick future leaders in the space, but to help effectuate the execution strategy needed to realize the significant upside potential in these assets.”
Pelorus Capital Group has been investing in the cannabis sector since 2016, completing more than $500 million in cannabis-related transactions and launching its stabilized lending program in 2021. In addition to the REIT Strategy, Pelorus has developed the Pelorus Data Project, which includes proprietary data compiling numerous financial and operational data points on cannabis portfolio companies representing more than 21,000 businesses, 31,000 licenses and 133 million square feet of cultivation.
