More coverage of North Coast cannabis commerce: nbbj.news/cannabis

The nearly two dozen cannabis-commerce applications submitted in Santa Rosa in the past year have brought a surge of business for North Bay contractors including architects, engineers, builders, traffic planners, landscapers, HVAC specialists, attorneys and security firms.

Steve Monahan launched Duke Capital Investors, LLC and in October submitted an application for a major conditional use permit at 2835 Duke Court in Santa Rosa. The project involves cultivation in a former church building with 24,510 square feet, 25 employees per shift and 90 parking spaces.

Monahan hired architect Peter Petruzzi, based in San Francisco, where Monahan had other cannabis business. The empty building is located in a quiet cul-de-sac across from a brewery and HVAC business, around the corner from the Jean and Charles Schulz Campus of Canine Companions for Independence on Dutton Avenue.

Aside from reckoning with cannabis odor, the “project will have negligible environmental impact,” Monahan said in his application. “Any odors will be mitigated and all effluent from the cultivation will be measured and tracked. The effluent itself has been independently evaluated and determined to be of negligible impact to city water systems.”


The Duke Court project has a couple of layers of legal structure in its business organization. “Duke Capital Investors is a single-member LLC managed by Sterling SC Six, LLC,” according to the Duke application to the city. Sterling SC Six is a single-member real-estate-investment company owned by Steve Monahan’s father, Thomas Monahan, CEO of Monahan Pacific, a real estate developer based in San Rafael.

“Steve is handling this,” according to Thomas Monahan. “Steve has a separate company called Duke Collective. That’s who the permit holder is” for the conditional-use in Santa Rosa. “That permits cultivation in that building. They will be completing that work this summer and begin operations after that. They will have special climate-control HVAC systems and smell or odor filtration, special lighting. It’s all very high-tech, clean rooms, pretty expensive. They will hire a general contractor to execute that design. They are planning to provide cannabis to medical dispensaries in compliance with state and local jurisdictions,” he said.

“This is his first one in Santa Rosa,” Monahan said of his son. “He is interested in doing others, actively looking at trying to expand. He has an elite team of people, different disciplines — architects, engineers, consultants, attorneys. He has a business degree and is an efficiency expert. He’s looking at it from a business level. He has other business interests in cannabis. He has been doing that for four or five years in San Francisco, has branched out into Sonoma County.”


Mike Ferguson manages a branch of First Security Services in the North Bay, serving Sonoma, Marin, Napa, Mendocino and Lake counties. He has cannabis-security business “only in Sonoma County, only in Santa Rosa,” said Ferguson, who employs about 100 security officers.

“I have about 11 proposals out for Santa Rosa” involving security for “marijuana-processing plants,” said Ferguson, who retired some 16 years ago from work as a lieutenant for the Sonoma County sheriff’s department. “It’s kind of ironic,” he said. “Back in those days, people who had any amount of marijuana were subject to arrest and jail time. Now I’m providing security services. I’m well aware of how to make defensible spaces.”

Two proposed security contracts are for facilities near his headquarters on Briggs Avenue in Santa Rosa, close to Cleveland Avenue. “I have one behind my office building and one down the block. My role is at the site, security officers 24/7, complemented by patrol vehicles during the night,” he said. None of the cannabis businesses is ready to open.

More coverage of North Coast cannabis commerce: nbbj.news/cannabis

“We have had requests for armed and unarmed” security guards, Ferguson said. “It depends on the facility and their level of comfort, what they want to portray. It can be several thousand dollars a month on up, just for the patrol officer,” he said. “It can be $10,000 a month.”

Applicants are required to submit names of security providers, Ferguson said. “At the end of the day, these are business people,” Ferguson said. “They want services in a professional way.”


Scott Bartley, partner in Hall & Bartley Architecture in Santa Rosa, is an architect for the Giffen Avenue Property development by Dennis Hunter and Edward Fussell. That project under development, with some 70,000 square feet of cultivation plus distribution and transportation, will be part of the largest cannabis operation in the North Bay, including CannaCraft, a medical cannabinoid extractor and manufacturer already operating nearby on Circadian Way.

“We have some others” in the Santa Rosa cannabis market, Bartley said, including one at 970 Piner Road called Piner Road Ventures, owned by Sonoma Gardens, a part of Marin Gardens, a medical-cannabis collective. The building used to house the Sonoma County Farm Bureau. “Another one is too early for me to talk about,” he said. “They’re still closing the real estate” deal. “We’re just starting the process.”

On Giffen Avenue, “only the first two buildings have been permitted for cultivation,” Bartley said. “It’s a huge facility, goes on forever. We did design work to convert the buildings. They are just a big empty box. It’s a good location, remote from neighbors.”

The former OCLI site has ongoing environmental remediation of groundwater contamination. “Site work is very limited,” Bartley said. “We can’t dig in contaminated soil. The landscape was relatively minor in terms of what we could do adjacent to the site. You can’t disturb it. Most of it is under asphalt.”

Due to its original use in manufacturing thin-film coatings, the Giffen Avenue site “has its own substation,” Bartley said. “Because OCLI was incredibly energy-intensive, that site is ideal for this,” with ample electrical supply to support growing cannabis plants. “It’s a prime piece of industrial land for the city, perfect for this use.”

Giffen buildings have minimal openings; one has many windows, but all are tiny. “Other ones we are seeing will be more challenging,” Bartley said, if they have ample window openings that pose security risks. “There’s more fenestration, more openings to deal with, large areas of window-wall. Those become challenges when you are redoing it.”

Security isn’t the only problem with windows. “If you are doing artificial grow, you want to block out natural light” that will interfere, Bartley said.

Cannabis projects now account for almost 20 percent of business for Hall & Bartley Architecture, with three active projects. The company’s focus has been primarily the wine industry, he said, with six active projects there, all much more complex and with higher monetary value than the cannabis work. Industrial processes across the two industries are similar, he said. “This is just a different industry coming in,” he said. “It has its own constraints and requirements.”

Cannabis commerce in CannaCom Valley so far involves “reuse and tenant improvements,” Bartley said, “much simpler than building a winery from the ground up.”

A couple of cannabis operators have approached the firm with plans to build custom cannabis facilities, he said, but neither project has moved forward yet. “There’s a spurt in activity right now,” Bartley said. “It’s kind of a boom, but I suspect it’s going to even out. Construction is expensive here. Industrial space is being gobbled up. If other communities in less expensive areas start doing it, the industry is going to naturally migrate. It will re-balance.” Places such as Half Moon Bay, where flower cultivation is strong, may offer better outdoor-growing opportunities for cannabis, he said.

Architect James Henderson, based in Santa Rosa, has cannabis projects underway for Middle Relief Partners on Empire Industrial Court and Aim High Cultivation on Industrial Drive. “Those are the two that we have submitted,” Henderson said. “I have two or three others I am working on. It’s a good chunk of work. It’s all use-permit stuff, a lot different than doing a set of construction documents for a building permit. It’s programming. You interview a client, figure out what they need, what space requirements are, what the process flow will be. We do a design, how much room they have for each of their functions. We make sure it meets code for fire exiting and accessibility” under ADA laws.

“We prepare an application, project summary, site plan, floor plan, elevations,” he said, “neighborhood-context map, location map exhibits. I do a detailed floor plan with room names and locations.” Some clients want several design iterations. Others more experienced with cultivation submit plans for how they want an operation to be laid out in a facility.

“There are clients trying to develop these facilities and they don’t have the expertise,” Henderson said. “They’re trying to set something up.”

Building codes are the same for different uses, but for buildings currently moving toward cannabis operations, “it’s a different occupancy than it was before,” Henderson said. “There are different requirements for exiting.” He has to consider how close a building is to property lines. He hires mechanical and electrical engineers to consult on those components of a project.

In some facilities, previous tenants were a “low energy user,” Henderson said. “These projects are energy- and air-conditioning-intensive, a lot of lights for growing. They want 1,200-amps from 400 or 600 amps (existing supply). A majority of them will justify 1,200 amps. We help the client submit to PG&E to get that upgrade going.”

Growers inject carbon dioxide into cultivation rooms to stimulate faster plant growth, said Henderson, who worked a couple of decades ago for Dell on its computer manufacturing plants. “This is not that much different,” he said. “It’s more agricultural, but there’s still a process — moving a product through stages to completion. They use light and CO2 to manipulate the plant to maturity. That is the most interesting part” in the emerging industry.

“Guys are using hydroponics to get water and nutrients to the plants. They’re not necessarily floating in tubs of water. They have a circulation system.”


“The perceived frenzy — it’s not like there’s this huge gold rush,” he said, “but a lot of people want to get their applications in soon. It really will be important when dispensaries” are given permits. “There are some distance limitations from each other,” he said. “Whoever is in first will most likely get approved. People are looking to get ahead of that” even though the ordinance is not finalized.

“It’s amazing what has happened on the real estate side. I have clients on other projects who haven’t been able to secure a building because they keep getting bought up by the cannabis industry. If you have to go through an SBA loan process, the guy with cash” is going to prevail in purchase transactions.

One of his clients, David Page at Middle Relief Partners, paid $1.7 million in cash for a building at 1805 Empire Industrial Court.

“Other businesses are getting pushed out to make way for this,” Henderson said. “It’s pretty amazing. The frenzy has been more on the real estate side than the architecture side.”

Buying existing real estate may raise concerns.

“Some buildings are better-suited for it,” Henderson said of cannabis operations. “I wish my clients would talk to me before they buy a building. A lot of times they are buying issues they are going to have to deal with.”


One such issue involves cannabis operators that do oil extraction.

“You are talking large quantities of CO2,” Henderson said. “If they allow more volatile stuff” such as ether, “you have to have more exits. You could become a high-hazard occupancy. Code doesn’t allow you to have an exit path that is as long. Some of these rooms, you have to exit directly to the exterior.

“If you bought a building that has zero [distance to] property line on three sides, you can only exit on one side. It restricts how you can lay that building out. You might need two exits out of one small room. Most other occupancy would only need one, and they could exit through a corridor. They may have to make compromises based on the building. It’s a giant jigsaw puzzle.”

Most cannabis operations involve less traffic than previous business uses, according to Dalene Whitlock, president of W-Trans in Santa Rosa. Whitlock has three traffic studies underway with cannabis companies.

“We are doing really small traffic studies for all of these,” Whitlock said, “basically a trip-generation comparison. They’re not big studies.”

Each study of a light-industrial site, half a dozen in the past year, brings about $2,500 in fees.

“If they are doing cannabis growing, there are so few people working there compared to the number of people who would work in a normal” light-industrial site, Whitlock said. She does trip-generation calculations based on the number of employees rather than square footage. For some sites, she also provides a report on parking availability.

“I don’t see them shipping out huge 18-wheelers of this stuff,” she said. “What they produce is going to be transported in smaller vans. From a road perspective, a car has zero impact. It will not break the road down. Trucks are what break the road down. From a traffic perspective, these [cannabis] projects are a benefit.”

Whitlock is a civil and traffic engineer who worked for the city of Santa Rosa and previously as assistant engineer for Marin County. In 1995, she co-founded W-Trans.

James Dunn covers technology, biotech, law, the food industry, and banking and finance. Reach him at james.dunn@busjrnl.com or 707-521-4257