Adam JacksonNevada’s cannabis lounge experiment faces some expected growing pains, with one of just two state-licensed venues closing its doors after barely a year in business, according to the Las Vegas Weekly.
“The regulatory framework, compliance costs and product limitations just don’t support a sustainable business model,” said Thrive Cannabis managing partner Mitch Britten, who plans to convert the space into an event venue until regulations loosen up.
The closure leaves Planet 13’s Dazed Consumption Lounge as the only operational state-regulated cannabis lounge in Nevada. Dazed manager Blake Anderson estimates the venue attracts around 250 customers daily, primarily tourists. One other establishment, Sky High Lounge, has operated since 2019 on sovereign Las Vegas Paiute Tribe land exempt from state regulations.
Even with Nevada regulators conditionally approving 21 more lounge licenses, potential owners are struggling to meet the $200,000 liquid assets requirement – particularly social equity applicants from communities hit hardest by prohibition.
Recreational marijuana has been legal statewide since 2017, but public consumption remains prohibited. That’s created an obvious disconnect for the millions of tourists who visit Las Vegas annually but have nowhere legal to use the products they purchase. The state recorded roughly $829 million in taxable sales during the 2024 fiscal year.
“It always comes down to money, and it’s difficult to get a space if you can’t afford to buy a building. On top of that, getting insurance and finding a landowner who’s willing to lease to a cannabis business is a challenge in and of itself,” said Christopher LaPorte, whose consulting firm Reset Las Vegas helped launch Smoke and Mirrors, told Las Vegas Weekly.
Many think the key to future success lies in legislative changes that would allow lounges to integrate with food service and entertainment – playing to Las Vegas’s strengths as a hospitality innovator. In the meantime, the industry will continue to adapt and push forward.
“Things take time,” LaPorte said. “There’s a culture that we have to continue to embrace and a lot of education that we still have to do. But at the end of the day, tourists need a place to smoke, and that’s what these places are.”
