New York City’s fabled legacy market is alive and well, with a new professional polish in the form of quasi-legal gray market retail shops and consumption lounges.
About 14 months ago New York’s legislature legalized adult use cannabis, setting off a still-ongoing process of crafting regulations and issuing licenses for every step in the cannabis supply chain. Although no legal sale of adult use cannabis can technically take place until those first retail licenses go out, there is an abundance of businesses throughout New York City who have already jumped the gun on cannabis sales.
This includes a countless number of corner stores converting to smoke shops, open air sales growing more bold with table top displays, and even trucks in high traffic areas selling pre-rolls and vapes
I recently visited the city to check out the vibrant gray market. One of my first stops was Granny Za’s Weed Marijuana Dispensary on the Lower East Side. Inside was a small, brightly-painted showroom with several clerks behind glass cases with examples of product.
Before I picked up my preroll, I asked the clerk if their flower was grown locally. He said “I can’t actually tell you where it comes from.”
A moment later he told me, “All of our stuff is grown and fully tested in California.”
A purchase went like this: Customers paid up front, then we were directed to a counter in the back of the room to get your purchase. In my case, it was a pre-roll claiming to contain 46% THC. The preroll’s label indicated that it came from Michigan, but the label either had incomplete or inaccurate information preventing it from being verified, according to an official from Michigan’s Cannabis Regulatory Agency.
Regardless of where the flower actually comes from, there is a significant trend in claiming California’s street cred for quality cannabis. Pre-packaged eighths of flower and edibles bearing California’s cannabis triangle icon are abundant, whether in a low-key consumption lounge, glorified bodega, or a smoke shop with CBD, glass pieces – and weed behind the counter if you ask for it.
In one shop, with walls lined with glass water pipes, snack food,and toiletries, I was offered eighths of prepackaged weed by the clerk in the back of the shop through two layers of glass panels. When asked if he had any “weed” for sale, he pulled out a pack bearing California-based brand Trufflez, opened it and presented a single nugget for inspection through his window.
Regardless of the quality of that cannabis, the Trufflez packaging was not legitimate, according to a spokesperson for the California-based company.
“There is so much fake packaging out there. We’re definitely aware of that,” said Eve Sarkisyan on behalf of Trufflez. “We have a ton of cease and desists out there about this.”
Mylar bags for eighths can be easily bought online, allowing sellers to portion out bulk sources of flower into smaller, more professional packages.
Another shop I visited looked like a converted bodega. The clerk said that he didn’t know anything about weed, but he had enough experience in that he reflexively opened packages to let me smell without my asking.
In contrast to the image of the knowledgeable bud tenders in states with legal cannabis markets, most of the people selling in New York City have very little knowledge of the plant.
Hugus, who declined to give his last name, is an artist in New York City who has painted murals in well over 50 cannabis shops throughout New York City. Hugus, born in Ecuador, has lived in the city for about nine years. In that time he developed a painting business and for the last two years, his talent has drawn the attention of smoke shops.
“My work has always been pop art and trippy cartoons,” he said, comparing his style to common themes found in cannabis products, such as trays for rolling joints or grinders. Basically, store owners that are not necessarily well versed in art lean toward the kind of art that can be found on rolling trays or other products. This art often relies upon pop culture cartoons, such as The Simpsons or Rick and Morty, which has been a boon for Hugus.
As a result of the demand for his work, Hugus has gotten a sense of how expansive the gray market is in New York City.
“They are in every borough, even Staten Island and Queens,” he said. “I’ve seen people, who already had weed farms, come straight from Cali with their family.”
Prices vary throughout the city, from as low as $20 for an eighth to as high as $75, from a shop in Harlem that sold cannabis from both ends of that spectrum in the back room of what owners plan to turn into a consumption lounge.
“The competition is real. It’s very common to see one guy open at least two shops,” said Hugus. “All the people are betting on whether they get a license or not.”
Further Uptown into Harlem, I visited Paint Puff n’ Peace, a chain of consumption lounges with six locations throughout the city.
Like many of the gray market shops in the city, this business kept an employee at the door to check ID cards, like a dive bar bouncer.
The Harlem shop had been operating for four months, and although the plan is for it to become a consumption lounge, for now visitors have to walk past two unfinished rooms, including one with several arcade machines that had yet to be unpacked.
Customers are brought into a back room where cell phones are specifically banned ostensibly to prevent recording of cannabis sales. Flower was sold in eighths, for as little as $20 and as much as $75. As usual, vape cartridges and edibles in generic packaging were also available.
Another business operating as a consumption lounge was Street Lawyer Services in the Lower East Side. The business is actually part of a brand that functions as a multi-state gray market operator.
Lonny Bramzon, a public defender in the Washington D.C. area owns a Lower East Side lounge, which allows consumers to smoke cannabis on site after it is gifted – following the purchase of an NFT. He also operates a location in Washington D.C. that provides cannabis gifts when customers also buy coupons for his legal services.
“We were selling coupons for my legal services and you get a gift with it,” said Bramzon. “That’s the sweet spot, this is the gray space market.”
A few months ago Bramzon opened a consumption lounge where prerolls can be purchased for as low as $15, with the option of lighting up in a back room covered in brightly-painted murals.
Despite lacking an official license for a consumption lounge, the employees at Street Lawyer Service did not appear concerned about potentially violating municipal restrictions against indoor smoking.
“We pay rent so we do whatever we want as long as the upstairs neighbor doesn’t smell,” he said.
Although he is open about operating in a gray market, Bramzon said his plan is to obtain a retail license for all of his properties as soon as their respective local governments allow an adult use market.
“We’re just trying to build our brand,” he said. “We want to stay in the game.”
