SAN JOSE — A successful cannabis dispensary plans to open a store at a high-profile downtown San Jose location, a retail outlet that could help revitalize the city’s urban core.
Purple Lotus, which is the No. 1 dispensary in San Jose, has struck a deal to lease a prominent ground-floor space at 66 West Santa Clara Street, a prominent location in the downtown.
“We really believe in downtown San Jose,” said Matt Krishnamachari, founder of family-owned Purple Lotus, a cannabis dispensary that for roughly 14 years has operated out of a North San Jose site near the corner of Commercial Street and Old Oakland Road.
For several years, the downtown San Jose location that Purple Lotus has leased was the site of a Peet’s Coffee shop and then a Verizon store, according to Mark Ritchie, president of Ritchie Commercial, a real estate firm that arranged the lease for Purple Lotus.
“This location is retail-ready for us,” Krishnamachari said.
Purple Lotus has leased 2,100 square feet on the ground floor of a commercial building at the corner of West Santa Clara Street and Lightson Alley, according to Ritchie. That’s near bustling San Pedro Square.
“This store will help revitalize downtown San Jose,” Ritchie said.
Plus, many now consider marijuana retail merchandising an acceptable segment of the retailing mosaic.
“The stigma is gone from cannabis,” Ritchie said. “Cannabis is a legit part of retail.”
A vibrant retail establishment can also provide a hopeful counterpoint to the brutal struggles that downtown San Jose has endured in the wake of the coronavirus-linked business shutdowns imposed by state and local government agencies.
“Purple Lotus will draw a lot of people to the downtown,” Ritchie said. “There is very little merchandise retail in the downtown right now.”
The downtown location for Purple Lotus will be an addition to its current operations. The dispensary will maintain its San Jose location at 752 Commercial Street, where Purple Lotus maintains a thriving in-person and delivery retail business.
“This is the only family-owned and -operated weed dispensary in San Jose,” Krishnamachari said. “The others have been sold to big corporations. We are really proud to be in this community.”
The new Purple Lotus store also is poised to be in the vanguard of dispensaries in commercial locations such as downtown San Jose. At present, cannabis stores are primarily in industrial districts.
“This is the first time we have expanded,” Krishnamachari said. “We are super excited about this new store.”
Last year, Purple Lotus generated $25 million in revenue. The company conducts about 200 delivery orders a day. Krishnamachari estimated that 75% of the company’s revenue is derived from in-store transactions. The dispensary also is a significant generator of tax revenue for the city of San Jose, he added.
The downtown San Jose store will have the same menu as the North San Jose retail site and will carry over 800 items. The store will offer flowers, pre-rolls, edibles, extracts, topicals, pills, tinctures and other categories.
“We offer all the major brands,” Krishnamachari said. “We are known to have a large variety and really dig deep to find the latest retail items.”
Krishnamachari recalls how he and other family members including his wife Vanessa Krishnamachari and sister Sara Krishnamachari started the business with $15,000 of their own money.
“It was a bootstrapped investment — only the family’s money,” Matt Krishnamachari said.
The North San Jose location is now busy enough that it accommodates up to 800 customers a day, he estimated. Krishnamachari believes the downtown store will be able to handle up to 300 customers daily, or even more.
“Even with 200 to 300 customers a day, that will be a lot of traffic and add liveliness to the area,” Krishnamachari said.
He estimated the downtown San Jose store will be open by February or March of 2024. The hours are slated to be 8 a.m. to 10 p.m.
“This is not only a chance to have another thriving retail store in our organization, this also gives us a chance to participate in the revitalization of downtown San Jose,” Krishnamachari said.