Pelorus Equity Group Rob Sechrist On Debt Cliffs And Cannabis Reform Landscape

On this Cannabis Exclusive podcast, Pelorus Equity Group Co-Founding President Rob Sechrist talked to TDR Founder Shadd Dales at the Benzinga Cannabis Capital Conference in Miami. The firm run The firm is a provider of real estate debt financing solutions and operates a specialty-use cannabis mortgage REIT Fund. Rob goes into detail about the conversations he’s having at Benzinga regarding the pace of regulatory reform and weighs-in on the all-important ‘debt cliff’ situation in U.S. cannabis, which is scheduled to reach an apex in 2026.

Regarding the former, Rob informs us that he was spoke with Rep. Dean Phillips (D-Min) in relation to just how close SAFE Banking could be to passing. Mr. Phillips is a member of the United States House of Representatives from Minnesota’s 3rd congressional district. He is a Democrat and has been serving in the House since 2019, after winning the election in November 2018.

Rob reveals his interaction with Dean and where it lead, revealing deep inside baseball that is always present on Capitol Hill. Despite a potential “chokepoint” of Republicans gaining majority in the U.S. House of Representatives, there is optimism that reform can still progress.

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Regarding the issue of debt cliffs, he expects operators with large debt coming due will extend the maturity, as there is “nobody paying them off”.

Although public companies have options in terms of raising capital (convertible share offering, private placement etc,), it is not an ideal environment to do so as the risk of excess dilution is high.

The term debt cliff refers to a situation where a company faces a sudden increase in its debt obligations in which it may not be able to repay or refinance. This can happen, for example, when a large amount of debt issued by a company is set to mature or become due for repayment within a short period of time. If the company is unable to repay or refinance this debt, it may result in a default on its obligations.