Cannabis Consumption Lounge


How to Start a Cannabis Consumption Lounge

People have always come together to enjoy cannabis, and cities throughout the United States are crowded with bars and restaurants providing alcohol, so why has consumption lounges taken so long to gain traction?

The main reason is the time taken to legalize the sale and consumption of cannabis. Cannabis usage in public or a social setting has been prohibited by many local governments.

However, the tide is turning, as several states have enacted new rules enabling licensing for cannabis lounges and other social areas where customers can legally consume cannabis goods.

States That Allow Cannabis Consumption Lounges 

There are now seven states in the United States that have passed legislation allowing consumption lounges. Despite the challenges that are present and prospective cannabis consumption lounge proprietors face, states continue to push forward.

While California and Colorado have unquestionably led the way in both legalizing and normalizing cannabis consumption lounges since the 1990s, states such as New Jersey, New York, Pennsylvania, Illinois, and Nevada are now following suit.

Let’s take a look at some interesting examples of states allowing consumption lounges:

New Jersey 

Public Question 1, which legalizes cannabis use, sales, and possession for people aged 21 and above, was decisively adopted by the state in November 2020. The approach taken by the Garden State, as is customary, is complicated.

Only “licensed cannabis merchants and medical dispensaries can even consider lawfully opening a cannabis consumption area” in New Jersey, according to CREAMMA, a branch of the state’s yet-to-be-created cannabis commission (CCA). In New Jersey, there will be no stand-alone CCAs.

According to current New Jersey regulations, a CCA is a specified location managed by a registered cannabis retailer or medical cannabis dispensary, for which both a state and local government “endorsement” (i.e., formal approval) has been obtained.

New York

Unlike New Jersey, New York has achieved an agreement that will allow for the establishment of separate, regulated cannabis consumption lounges.

According to the New York Times, these locations will be club-like lounges or consumption venues, where only marijuana but no alcohol will be consumed.

NY offers room for others to enter the regulated cannabis space without growing or packaging the plant, with income expected to reach almost $6 billion by 2027. 


Pennsylvania bravely hosted its annual Pennsylvania Cannabis Festival, but it was a single licensed outdoor event. But what about marijuana-consuming lounges?

The After Dispensary in Abington, PA, is the only place in Pennsylvania that allows consumption. Residents of Pennsylvania with a valid MMJ card are welcome to visit this BYOC (Bring Your Own Cannabis) place.


The state of Illinois has also opened its first licensed consumption lounge, which will be BYOC. Cannabis consumers can visit the newly established Luna Lounge to securely consume cannabis as well as pick up regular smoke shop-style products.

A movie theatre owner in Illinois has huge aspirations to turn his facility into a cutting-edge cannabis co-operative. The former AMC theatre will be a co-operative dispensary, greenhouse, and consumption lounge if all goes according to plan — which, come on, it’s cannabis! So, there are bound to be roadblocks.


Nevada, which is known for being scandalous, fun, and progressive, has been unexpectedly sluggish to legalize cannabis lounges. This movement has spread to its most popular city, Las Vegas, where city restrictions have been enacted to allow consumption at a restricted number of qualified dispensaries, maybe in the hopes of convincing Nevada to modify its state prohibition as well. This may have worked well because social use legislation was just introduced in the state, creating two new licensing categories for cannabis businesses.

The bill specifies two types of cannabis consumption lounges: retail cannabis consumption lounges and independent cannabis consumption lounges.

How to Start a Cannabis Consumption Lounge

1) Put Together a Business Plan

A marijuana consumption lounge business plan necessitates an understanding of the appropriate site and operational requirements. Different states have different regulations regarding zoning, especially for the designated consumption establishments. Some states like New York are allowing stand-alone consumptions lounges while some states such as New Jersey are allowing only licensed cannabis merchants and medical dispensaries to lawfully open a cannabis consumption area. So, you must inquire about the regulations in your state accordingly prepare a robust business plan.

Also, keep in mind that the marijuana business model you develop, the investors you choose, and the partners you select all have an impact on your license acceptance; make sure they’re all good. Throughout the process, everyone will have their background examined, from investors to employees.

Consumption Lounge proposal requires a detailed business plan covering the following points:

  • Business operations
  • Security Plan
  • Licensing
  • Waste Handling And Disposal
  • Environmentally Sustainable Practices
  • Community Relations
  • Recruitment And Training Of Employees

Consider reaching out to a cannabis business plan writer for assistance.

2) Find a Location

You’ll need a qualifying location to pursue this opportunity. To begin, you’ll need the backing and approval of your local municipality, as with any cannabis licenses. The next step is to locate a facility that includes all of the following features: 

  • Your establishment will require a designated place for marijuana consumption. Smoke-free spaces will also be required in your lounge. To begin, decide on a location within your facility where your customers will be able to consume cannabis.
  • Employees will require a smoke-free place to oversee the marijuana consumption area at your facility. As the facility operator, it will be your responsibility to ensure that your staff is not exposed to unintentional or indirect cannabis usage while on the job.
  • Your establishment must have a ventilation system that sends air from the marijuana consumption area to the outside of the building via a filtration system that removes visible smoke and odor. Additionally, your facility must have enough walls and barriers in place to prevent smoke from infiltrating non-smoking sections.

3) Put Together an Operations Plan

  • The local authority will want to know the applicant’s projected goals for facility operations, such as suggested hours of operation and intended channels for customers to obtain cannabis at the facility. Will your facility be co-located with a microbusiness, or will your customers be allowed to bring their own cannabis inside the facility?
  • The plan must include a full description of how the applicant will supervise use at the facility, avoid over-intoxication, underage access, and illicit cannabis sales or distribution within the establishment. Applicants must also develop a personnel training program to guarantee that the facility’s responsible operations strategy is implemented.

4) Create a Security Plan

Building, Construction, and Zoning details are required so that the local authorities can verify a safe operation, including a building and fire safety evaluation, as well as ensuring that there will be no negative impact on nearby businesses and residents.

5) Apply for a License

The License Application must include:

  • If applicable, Legacy Certification
  • A signed release authorizing background checks
  • A conditional land use approval for a private club that references the use of marijuana
  • A business plan
  • Financial Documentation
  • Copy of State’s prequalification

What Licenses Do You Need?

The solution is to create safe places where individuals can lawfully consume cannabis products. 

Several states already have cannabis consumption licenses, which must be carried in conjunction with an active retailer license or can be held separately. Some states get around the laws by allowing private property owners to charge a membership fee for customers to join their businesses and consume cannabis products. Another significant difference in state laws is whether people can buy and consume cannabis on the spot or if they must bring their own.

A consumption café/lounge must, in general, have licensed premises, which is a physical site where commercial cannabis activities are carried out.

The consumption café/lounge may only offer cannabis or cannabis products to adults aged 21 or older for on-site consumption, such as smoking, vaping, or ingesting edible or topical items.

The space occupied by a consumption cafe/lounge must be distinct and separate from the space used for other activities licensed under this regulation, and it must be entered via a separate entrance.

6) Put Together a Waste Disposal Plan

Applicants must have a plan in place to handle and dispose of any waste generated at the consumption lounge, including any unfinished cannabis items left behind by customers.  

Consumption Lounge Do’s and Don’ts


Applicants must have a legal right to real estate or physical infrastructure.

Applicants for consumption licenses must have legal access to the location where cannabis will be consumed. That means a consumption licensee must either own the premises or have a written lease for at least as long as the license’s original duration. The requirement to produce evidence of that lease will not be necessary for license renewal, therefore it appears that the obligation to provide the lease is only an issue for first-time applicants.

There is an exception for buildings leased from government entities.

If a government entity provides written documents describing the terms of tenancy, an applicant leasing or occupying a premise from them is not required to produce evidence of a lease.


Applicants are not permitted to conduct business in sensitive areas.

The premises of the consumption license must be at least 500 feet away from school grounds and at least 200 feet away from a house of worship.

Top Cannabis Consumption Lounges in the US

Loopr, Denver, Colorado

It’s a mobile smoking lounge with a unique design. Loopr is a Denver-based mobile nightclub that allows seasoned smokers to experience the mile-high metropolis from a mile away. Variously themed tours, ranging from gastronomy to nature, allow visitors to explore a different side of Denver. Along with allowing them to enjoy their cannabis.

Magnolia Oakland, Oakland, California

San Francisco isn’t the only Bay Area city where you can get high with your friends. Oakland’s Magnolia dispensary, vape lounge, and dab bar is located in the East Bay. Bring your own beverage or purchase one onsite to enjoy right away in one of the lounge’s complimentary Volcano vaporizers. Both the dab bar and the vape bar provide a diverse range of goods.

There’s even a trained nurse on staff who can help anyone with medical inquiries or concerns.

This consumption lounge is conveniently located near Jack London Square, and it promotes a true sense of community for cannabis users in the East Bay.

The Summit Private Lounge, Worcester, Massachusetts

The Summit Private Lounge in Worcester is located a short distance west of Boston. Enjoy cannabis tastings while listening to live music or playing video games at this elegant bar and lounge with an upgraded yet rustic aesthetic. It’s also the only location on the East Coast that permits legal cannabis usage on the premises.

Rent or buy smoking equipment (such as a piece or a bong) and enjoy the cold drinks, food, and coffee that are available.

Anyone with a membership or visitor pass can attend bi-monthly events, paint evenings, and video games.

The idea of a ‘members-only’ club may seem expensive and exclusive, but the Summit makes its social cannabis experience affordable for a monthly charge of $15.


Now that you know about setting up consumption lounges, it is time to try one out for yourself. We know you wouldn’t be able to embark on this journey all by yourself, hence, you can talk to our experts to help you out with this.

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