Pacific Collective, LLC v. TGS CC Ventures, LLC: California Appeals Court Holds Build-to-Suit Landlord's Slow Land Purchase Let Jushi Unit Rescind Culver City Dispensary Lease

Commercial Lease Disputes Ruling Issued
Date
October 12, 2026
Added to tracker
October 13, 2026
Court or forum
California Court of Appeal, Second Appellate District, Division Three
State
California
Property type
Retail
Amount / scale
Damages alleged to exceed $20 million; $4.2 million land purchase
Parties
Plaintiff/Appellant (Landlord): Pacific Collective, LLCDefendant/Respondent (Tenant): TGS CC Ventures, LLCDefendant/Respondent (Guarantor): Jushi, Inc.

On October 12, 2026, a California Court of Appeal panel affirmed a judgment for cannabis retailer TGS CC Ventures, LLC and its parent and lease guarantor Jushi, Inc. in a suit by developer Pacific Collective, LLC over a 15-year build-to-suit lease for a dispensary at 3800 Sepulveda Boulevard in Culver City. The court held that the lease implicitly required Pacific to buy the land from ExxonMobil within a reasonable time, and that substantial evidence supported the referee's finding that its delay justified TGS's February 2020 rescission. Pacific had alleged damages of more than $20 million against the tenant and guarantor.

Why it matters

The decision is a warning to build-to-suit developers who sign a lease before they control the land: if the lease sets no outside date for acquiring title, California courts will imply a reasonable time, and strategic delay to save financing costs can hand the tenant a rescission right. It also shows that a tenant's guaranty falls with the lease when the landlord is the party in material breach.

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Pacific Collective, LLC, a real estate developer, learned in 2018 that ExxonMobil Oil Corporation was selling a parcel at 3800 Sepulveda Boulevard in Culver City that sat inside the city's zone for retail cannabis dispensaries. Pacific signed an option with ExxonMobil in September 2018 and, on September 26, 2018, signed a lease with TGS CC Ventures, LLC, a subsidiary of national cannabis operator Jushi, Inc. Jushi signed a guaranty of the tenant's obligations the next day. Pacific was to buy the land, build a 5,000 square foot building at a cost of no more than $1.75 million, and rent it to TGS for 15 years at a starting rent of $20 per square foot, while TGS pursued a city cannabis license.

Case timeline · 6 entries Latest: October 12, 2026 — Court of Appeal affirms judgment for tenant and guarantor

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