Distressed Cannabis Operator Ayr Wellness Loses Control in Foreclosure Sale Creditors Take Over Assets Across Seven States
LOS ANGELES — One of the cannabis industry’s most aggressive multistate expansion stories has ended in foreclosure. Distressed marijuana multistate operator Ayr Wellness is now officially owned by its former creditors, marking one of the largest collapses yet among U.S. cannabis operators.
Creditors Take Control Through Foreclosure Auction
Following months of restructuring talks triggered by an overwhelming debt load, Ayr’s senior note holders took ownership of the company’s assets and equity interests in seven states through a foreclosure auction held Tuesday, according to a news release.
The company did not disclose financial details of the transaction, though filings show the creditors held $387 million in credit that could be used to acquire Ayr’s assets.
The sale remains subject to state regulatory approvals, which could take months as licenses transfer to the new ownership entity.
Ayr Wellness Begins “Winding Down” Operations
The foreclosure is part of a broader plan to wind down Ayr Wellness as it currently exists, the company said. For now, some operations will continue under interim management while the transfer to the new corporate structure takes place.
“This transaction positions the new company to emerge stronger, with a more sustainable balance sheet,” said interim CEO Scott Davido. “We remain committed to supporting employees and customers during this transition.”
Once a Market Darling, Now Nearly Worthless
The fall of Ayr Wellness underscores the volatility that continues to define the U.S. cannabis sector.
At the market’s peak in 2021, Ayr’s shares traded above $35. On Wednesday, they closed below $0.02 — effectively worthless.
As of mid-2024, Ayr carried $358 million in debt maturing by 2026, filings show. Analysts had warned that without a significant capital infusion or merger, insolvency was inevitable.
The restructuring plan will reportedly cut the company’s debt burden by half and allow new investment, particularly in Virginia, where Ayr holds one of only five vertically integrated medical cannabis licenses.
Foreclosure Includes Operations in Seven States
According to the company, creditors now control Ayr’s holdings in:
- Florida – 66 medical marijuana dispensaries.
- Massachusetts – where the company shuttered a 217,800-square-foot cultivation facility earlier this year.
- New Jersey – three adult-use dispensaries.
- Nevada – where layoffs were recently announced.
- Pennsylvania – six medical dispensaries.
- Ohio – seven medical dispensaries.
- Virginia – one of five vertically integrated medical cannabis permits, where adult-use sales could begin next year.
Ayr’s Pre-Foreclosure Sell Offs Foreshadowed Collapse
Even before the foreclosure, Ayr had begun shedding assets to raise cash. Over the past several months, the company sold:
- Massachusetts: A cultivation/manufacturing site and a medical-only dispensary in Needham.
- Pennsylvania: Three PA Natural retail stores and a cultivation facility in Pottsville.
- Nevada: A cultivation and processing site.
- New Jersey: A Lakewood cultivation facility.
- Connecticut: One retail location.
Industry Implications: A Warning for MSOs
The Ayr Wellness foreclosure highlights the deep financial strain across U.S. cannabis markets — a combination of high taxes, limited capital access, and uneven state regulations that has left even large operators struggling.
While creditors now have an opportunity to rebuild under a leaner corporate structure, the collapse of Ayr serves as a stark reminder that rapid expansion without sustainable margins remains a dangerous play in an industry still waiting for federal reform.
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