RIV Capital Inc. (OTCPK:CNPOF) (CSE:RIV) acting through its wholly owned indirect subsidiary, RIV Capital US Real Estate LLC, and Etain, LLC revealed that RIV Capital has entered into a lease agreement with Zephyr, a California-based developer, for the development and operation of a planned new flagship cannabis cultivation and manufacturing facility in Buffalo, New York. RIV Capital will sublease the flagship facility to Etain upon receipt of necessary regulatory approvals.
Under the lease agreement, Zephyr will develop and lease to RIV Capital two buildings totaling approximately 75,000 square feet. Total development costs for the project are expected to be approximately $30 million, of which RIV Capital will be responsible for $4.5 million. RIV Capital will pay base rent to the landlord over the term of the lease based on what the company believes is a favorable cap rate applied to the developer's portion of the project costs. The initial term of the lease is for 15 years. RIV Capital and Etain also have the option to expand the leased premises to include additional building(s) of added manufacturing and cultivation space.
