Smoke and Mirrors, Nevada’s first state-licensed cannabis lounge, has officially closed its doors after approximately 14 months of operation. Located in Las Vegas and managed by Thrive, the lounge ceased operations earlier this month, as reported by KLAS.
Currently, only one other state-licensed cannabis lounge remains open in Nevada, which is operated by the Las Vegas Paiute Tribe and does not require state licensing. Despite the interest in cannabis consumption lounges, the state Cannabis Control Board (CCB) has conditionally approved 21 additional lounges that have yet to open due to various challenges, primarily related to financing and site selection.
Furthermore, there are 10 lounge licenses set aside for social equity applicants, but these licenses have not yet been utilized.
The closure of Smoke and Mirrors coincides with a noticeable decline in cannabis sales within Nevada. Data from the CCB indicates that taxable cannabis sales from state-licensed retail dispensaries totaled $829 million during the 2024 fiscal year, marking a 17% decrease compared to 2021.
Several factors may have contributed to the challenges faced by cannabis lounges in Nevada. State regulations mandate that lounge operators maintain $200,000 in operational liquidity before opening. Additionally, the law restricts lounges from serving cannabis-infused food and permits only smoking and infused beverages, which may limit their appeal.
Moreover, patrons cannot take home any leftover cannabis, as all purchases must be consumed on-site. These regulations may hinder the lounge experience, reducing customer interest and impacting overall business viability.
As the cannabis industry continues to evolve in Nevada, it remains to be seen how these developments will affect the future of consumption lounges and cannabis sales statewide.
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