California Cannabis Retail Market Update – January 2026
California’s cannabis retail market enters 2026 with significant developments. Santa Monica confirmed its retail application window opening January 26, San Francisco secured a decade-long tax suspension through 2035, and Nevada County’s dispensary evaluation committee is operational for new licensing opportunities. For cannabis retailers watching California’s cannabis market, January has delivered confirmed opportunities and regulatory clarity in key markets.
Plus, see the bottom of this email for multiple retail acquisition opportunities across the golden state.
🆕 CONFIRMED MARKET DEVELOPMENTS:
- 🆕 Santa Monica – Retail application window opens January 26, 2026
- 🆕 San Francisco – Cannabis tax suspension extended through 2035
- 🆕 Nevada County – Dispensary evaluation committee operational
Top Headlines This Month
- Santa Monica opens retail application window January 26, first-come first-served
- San Francisco Board of Supervisors extends cannabis business tax suspension to 2035
- Nevada County dispensary evaluation committee established for new licensing
- Multiple jurisdictions advancing cannabis retail frameworks
🏪 SANTA MONICA – RETAIL APPLICATION WINDOW OPENS JANUARY 26
The Setup:
Santa Monica opens its cannabis retail application window on January 26, 2026, with applications processed first-come, first-served and social equity provisions. The city applies a 4% cannabis business tax to retail operations.
The Impact:
Defined timeline and transparent process. Santa Monica has a population of 93,000 and serves as a coastal gateway to Los Angeles, creating strong tourism and local consumer demand. The 4% tax is below California’s average, improving margin potential. First-come processing rewards speed and preparation.
The Opportunity:
Prepare applications now to submit on day one. Interested applicants can now review requirements and gather necessary materials to prepare for the application launch date. The first-come processing means early preparation and swift submission are critical for securing position in the application queue.
Strategic Angle:
Have your application package complete by January 20. First-come processing means every day you delay costs you position in line. For more information, application materials and instructions, visit Santa Monica’s cannabis program page.
Source: Santa Monica Daily Press
🏛️ SAN FRANCISCO – 10-YEAR CANNABIS TAX SUSPENSION EXTENDED TO 2035
The Setup:
San Francisco Board of Supervisors voted to suspend its local cannabis business tax until Dec. 31, 2035. The board made an 8-2 vote to eliminate the city’s local cannabis tax for an unprecedented 10 years, creating a decade of stability for an industry struggling under the weight of California’s overregulation and overtaxation of cannabis.
The Impact:
Predictable cost structure for the next decade. San Francisco’s retail market operates without a local cannabis business tax until 2035, improving profitability and competitive positioning against neighboring jurisdictions with active taxes. This signals long-term city commitment to cannabis retail viability.
The Opportunity:
If you operate in San Francisco or planned to delay expansion due to tax uncertainty, this removes a major cost risk. Model your 10-year financials with zero local cannabis tax and reassess expansion or acquisition opportunities. The tax break makes San Francisco different from every major city in the state – especially Los Angeles, which imposes a 10% local cannabis tax.
Strategic Angle:
Review your San Francisco portfolio or expansion plans before Q1 ends. A decade of tax certainty changes investment math and makes this market more attractive for capital deployment compared to cities with unpredictable or rising tax rates. And see below for available retail opportunity in SF.
Source: Cannabis Business Times
🆕 NEVADA COUNTY – DISPENSARY EVALUATION COMMITTEE OPERATIONAL
The Setup:
Nevada County is looking for seven community members to serve on the new Commercial Cannabis Dispensary Evaluation Committee. Committee members will be responsible for implementing a selection process and recommending the most qualified applicants to operate the first retail storefront commercial cannabis dispensaries in unincorporated Nevada County.
The Impact:
Ground-floor opportunity in newly opening market. This is Nevada County’s first retail dispensary licensing program for unincorporated areas. One cannabis dispensary will be allowed in North San Juan (District 4) and Soda Springs (District 5). The county has a population exceeding 100,000, with limited existing retail access concentrated in incorporated cities.
The Opportunity:
The committee will establish a competitive, merit-based process for selecting the most qualified applicants to apply for a discretionary use permit through the Nevada County Planning Department. Top-scoring dispensary applicants will have 12 months to apply for a use permit.
Strategic Angle:
To learn more about the Commercial Cannabis Dispensary Evaluation Committee visit Nevada County Commissions. Contact cannabiscompliance@nevadacountyca.gov for application window notifications.
Source: Nevada County Official Notice
California Acquisition Opportunities
Santa Ana (Orange County)
Standalone retail with 20+ parking spaces. Premium OC market location. Clean operation with proven performance.
$3.3M Annual Revenue | $2.475M Ask
San Francisco (3 store portfolio)
Well located and well established portfolio of three retail stores with doors open. Take advantage of the next decade of no taxes in SF.
$6M+ Annual Revenue | $3M Ask
San Francisco
Fully approved retail dispensary, vanilla shell, not yet built out. Take advantage of the next decade of no taxes in SF.
$1.5M Ask
Lake Elsinore (Riverside County)
Multi-use facility: retail + distribution + commercial kitchen.
$3.0M Annual Revenue | $2.25M Ask
Moreno Valley (Inland Empire)
Strip center retail with strong traffic and ample parking. 9% net margins with room to optimize.
$2.4M Annual Revenue | $1.8M Ask
Contact us for more information on the above opportunities.
The Bottom Line
California’s January 2026 cannabis retail landscape has delivered confirmed opportunities in Santa Monica (January 26 application window), San Francisco (decade-long tax break through 2035), and Nevada County (evaluation committee operational for new dispensary licensing). For California cannabis retailers, the takeaway is clear: verified opportunities exist with defined timelines and transparent processes. Prepare for Santa Monica’s January 26 window with complete applications. Reassess San Francisco investments given the decade of tax certainty. Monitor Nevada County’s committee progress for ground-floor dispensary opportunities. Focus on confirmed developments where regulatory frameworks are established and operational.
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