New Jersey Welcomes Consumption Lounges

🌿 New Jersey Embraces Cannabis Consumption Lounges: A New Era for Social Use

As of January 2, 2025, New Jersey has officially opened applications for cannabis consumption lounges, marking a significant milestone in the state’s evolving cannabis industry.

These lounges are designed to offer adults aged 21 and over safe, regulated spaces to consume cannabis legally and socially. With rules finalized in December 2024, the Garden State is entering a new era of cannabis culture—one that emphasizes equity, safety, and community.

📝 Regulatory Framework & Application Process

Under the New Jersey Cannabis Regulatory Commission (CRC), consumption lounges must be physically attached to a licensed cannabis dispensary—standalone lounges are not permitted. Both state and municipal approvals are required, giving local governments a crucial role in the process.

Social equity remains at the heart of the program. Priority is given to qualified social equity applicants, in line with New Jersey’s ongoing efforts to address the impacts of past cannabis prohibition.

On April 2, 2025, the CRC expanded the application process to include microbusinesses and diversely-owned dispensaries (e.g., minority-, women-, and disabled veteran-owned). The final application phase opens on July 2, 2025, for all remaining Class 5 retail operators.

Application Costs:

$200 application fee
$800 approval fee (once accepted)
$1,000 annual license for microbusinesses
$5,000 annual license for standard businesses

🔒 Operational Guidelines

To maintain compliance and public safety, lounges must adhere to the following state-mandated rules:

🚫 No Alcohol or Tobacco

Alcohol and tobacco are not permitted on the premises.

💨 Ventilation Standards

Indoor lounges must have ventilation systems comparable to cigar lounges, ensuring smoke doesn’t escape into public areas.

🌳 Outdoor Consumption

Outdoor areas must be partially enclosed and shielded from public view per the state’s Smoke-Free Air Act.

🏪 One Lounge Per Business

Operators may open only one consumption lounge, no matter how many dispensary licenses they hold.

🍽️ Food Policy

On-site food sales are banned, but patrons may bring their own meals or order delivery (subject to local law).

🏙️ Spotlight on Jersey City

Jersey City is leading the way with localized policy. The city council has proposed allowing one lounge per ward (six total) and limiting hours to 11:00 p.m. They’re also working to simplify the application process by removing unnecessary steps.

Yet, despite these proactive steps, some entrepreneurs face challenges. Haytham Elgawly, owner of XENA Dispensary, has invested over $1 million into his planned lounge but faces delays due to the inactivity of the local Cannabis Control Board.