Property and Equipment

12 Months Ended

Dec. 31, 2020

Property, Plant and Equipment [Abstract]

6.	PROPERTY AND EQUIPMENT

At December 31, 2020, property and equipment consisted of the following:


Cost	Land			Buildings and Improvements			Equipment, Computers and Furniture			Leasehold Improvements		Capitalized Interest		Assets Under Construction			Total
As at January 1, 2020	$	3,272,439		$	33,377,471		$	35,509,871		$	68,681,497	$	2,500,000	$	21,372,116		$	164,713,394
Additions		586,867			22,687,020			13,587,238			19,925,75 5		488,681		4,595,227			61,870,788
Disposals		(979,930	)		(4,507,086	)		—			—		—		(6,978,389	)		(12,465,405	)

As at December 31, 2020	$	2,879,376		$	51,557,405		$	49,097,109		$	88,607,252	$	2,988,681	$	18,988,954		$	214,118,777

Accumulated Depreciation
As at January 1, 2020	$	—		$	2,236,254		$	3,882,178		$	2,998,287	$	—	$	—		$	9,116,719
As at December 31, 2020	$	—		$	3,357,360		$	10,344,829		$	10,264,683	$	226,028	$	—		$	24,192,900
Net book value
As at January 1, 2020	$	3,272,439		$	31,141,217		$	31,627,693		$	65,683,210	$	2,500,000	$	21,372,116		$	155,596,675
As at December 31, 2020	$	2,879,376		$	48,200,045		$	38,752,280		$	78,342,569	$	2,762,653	$	18,988,954		$	189,925,877
At December 31, 2019, property and equipment consisted of the following:
Cost	Land			Buildings and Improvements			Equipment, Computers and Furniture			Leasehold Improvements		Capitalized Interest		Assets Under Construction			Total
As at January 1, 2019	$	2,243,085		$	20,861,988		$	11,001,498		$	18,435,893	$	—	$	16,664,958		$	69,207,422
Additions		4,393,030			28,217,500			23,109,209			38,002,678		2,500,000		4,678,084			100,900,501
Additions from acquisitions		—			—			4,253,362			12,242,926		—		29,074			16,525,362
Disposals		(3,363,676	)		(15,702,017	)		(2,854,198	)		—		—		—			(21,919,891	)

As at December 31, 2019	$	3,272,439		$	33,377,471		$	35,509,871		$	68,681,497	$	2,500,000	$	21,372,116		$	164,713,394

Accumulated Depreciation
As at January 1, 2019	$	—		$	1,351,230		$	1,524,114		$	1,007,998	$	—	$	—		$	3,883,342
As at December 31, 2019	$	—		$	2,236,254		$	3,882,178		$	2,998,287	$	—	$	—		$	9,116,719
Net book value
As at January 1, 2019	$	2,243,085		$	19,510,758		$	9,477,384		$	17,427,895	$	—	$	16,664,958		$	65,324,080
As at December 31, 2019	$	3,272,439		$	31,141,217		$	31,627,693		$	65,683,210	$	2,500,000	$	21,372,116		$	155,596,675

Assets under construction represent construction in progress related to both cultivation and dispensary facilities not yet completed or otherwise not ready for use.

Depreciation expense for the year ended December 31, 2020, 2019 and 2018 totaled $15,479,179, $6,827,711 and $2,687,025, respectively of which $8,283,206, $4,246,524 and $1,346,632, respectively, is included in cost of goods sold.

On March 6, 2020, the Company closed a sale and lease back transaction to sell its Oglesby, Illinois cultivation and processing facility to Innovative Industrial Properties (“IIP”). Under the long-term agreement, the Company leased back the facility and continues to operate and manage it. As a result of the sale, the Company disposed of $774,930 of land, $4,507,086 of buildings and improvements and $3,813,636 of construction in progress. The Company recognized a gain on the sale of Oglesby facility of $239,096 which was recorded within other income (expense) within the consolidated statement of operations.

On January 31, 2020, the Company closed a sale and lease back transaction to sell its Toledo, Ohio processing facility to IIP. Under the long-term agreement, the Company leased back the facility and continues to operate and manage it. As a result of the sale, the Company disposed of $205,000 of land and $2,695,000 of construction in progress. There was no gain or loss on the sale.

On November 12, 2019, the Company closed on a sale and lease back transaction to sell its Danville Pennsylvania cultivation and processing facility to IIP. Under the long-term agreement, the Company will lease back the facility and continue to operate and manage it. As a result of the sale, the Company disposed of $3,363,676 of land, $15,702,017 of buildings and improvements, and $2,854,198 in production and processing equipment. There was no gain or loss on the sale.

For further information regarding these transactions, see Note 10—Leases.