Grown Rogue Secures Cultivation Facility in Minnesota

Executive Summary

• Grown Rogue International Inc. entered a long‑term lease for a ~109,000 sq ft building in Fridley, Minnesota, approved for cannabis cultivation.
• The lease provides base rent of $0.73 per sq ft (≈$75 per sq ft acquisition cost by landlord) and will support up to 30,000 sq ft of indoor flower canopy – the maximum permitted in Minnesota.
• Phase I construction (~10,000 sq ft of flowering space) is slated for early 2026 with first product expected in early 2027, representing a significant geographic expansion and potential upside for the company.

Key Details

• Facility Size & Location: Approximately 109,000 sq ft building in Fridley, Minnesota (greater Minneapolis metro area).
• Lease Terms: Long‑term lease with monthly base rent of $0.73 per sq ft; landlord acquired the property at ~$75 per sq ft.
• Regulatory Approval: Conditional use permit for cannabis cultivation already secured.
• Build‑out Plan: Phased development up to 30,000 sq ft indoor flower canopy (maximum allowed in MN).
• Phase I: ~10,000 sq ft flowering canopy and supporting infrastructure; construction expected to begin early 2026.
• First Product Timeline: Anticipated for early 2027.
• Financial Strategy: Majority of tenant improvements to be funded from Grown Rogue’s balance sheet, aiming to keep occupancy costs low and maintain a low‑cost production model.
• Related Agreements: Executed definitive sublease and management services agreements with Minnesota license holder Christian Stiers (subject to regulatory approval); disclosed in continuous disclosure filings.
• Strategic Rationale: Expands Grown Rogue’s footprint into the growing adult‑use market of Minnesota, provides optionality for future scaling, and may accommodate complementary subtenants as regulations evolve.

Notable Quotes

• “We appreciate Rainbow's support … they have been great to work with as we secured the Facility and the conditional use permit.” – Obie Strickler, CEO, Grown Rogue
• “Securing this location on favorable terms is the first tangible milestone for the Minnesota project…” – Josh Rosen, Chief Strategy Officer, Grown Rogue

Materiality: Material – Positive (significant expansion into a new regulated market with clear timelines and financial implications).