By Nate Seltenrich

The shelves have yet to be stocked. The tables are bare. The counter is quiet. But all that is about to change in a few short days as Down Under Industries, a homegrown Petaluma cannabis retailer, prepares to open its second local storefront and first inside city limits.

It will also be the third and final brick-and-mortar dispensary allowed in Petaluma under regulations passed in June 2024.

For husband-and-wife co-owners Rod Graf and Jamie Reagan, the long-delayed expansion beyond Down Under’s original location at 50 Ely Road, a rustic boutique on county land just outside Petaluma, still feels a bit like a leap of faith. 

To make it happen, they had to purchase a two-story, glass-walled building at 191 Lynch Creek Way – tucked behind Friedman’s Home Improvement among medical office buildings fronting Highway 101 – then remove multiple walls and completely redesign the 1,200-square-foot corner space that is now their nascent shop. 

But judging by the experience of the other two new cannabis stores in town, there’s plenty of business to go around.   

Three’s the magic number?

Petaluma City Council’s vote in June 2024 to allow up to three dispensaries in city limits was years in the making. Californians voted in November 2016 to legalize recreational cannabis use, sale, and cultivation, and the following year the city enacted its own cannabis ordinance that permitted sales through delivery service, but not storefront retail.

Six months after changing its tune, the city awarded permits for the new shops to three local businesses.

Down Under Industries has been operating on Ely Road since late 2019. For their new store inside city limits, Graf and Reagan initially zeroed in on a location on Lakeville Highway. Yet that prospect fell through in early 2025 due to the building’s proximity to San Antonio High School in midtown Petaluma, Reagan said, sending her and Graf back to the drawing board.

The search for another location eventually led them to the building at 191 Lynch Creek Way, which they purchased in June 2025 and have been preparing to open ever since, Reagan said.

“Once we got our plans approved, we started work,” said Reagan, who grew up in Petaluma and is raising her own kids here. “We're independent. We don't have investors, and so my husband and I do a lot together. I do a lot more of the office work. He does more of the construction. But we're a learn-as-you-go, figure-it-out, be-resourceful kind of couple.”

Farmhouse Artisan Market, also run by a local couple, was the first of the three permittees to open its doors, one year after the permit was issued. The business was already operating as Petaluma’s first and only cannabis retailer inside city limits as a delivery-only service since 2018. Farmhouse’s clean, modern shop in a nondescript building at 1333 N. McDowell Blvd., suite B., next to HenHouse Brewing Company’s Palace of Barrels, opened in December 2025.

Solful, a Sebastopol-based company with existing dispensaries in Sebastopol, San Francisco, and Healdsburg, was the second to open its doors to walk-in customers. The spacious shop opened in April 2026 in a new building at the site of the old Cattlemens restaurant at 5004 Petaluma Blvd. N.

Cannabis sales strong in town

With plans for their new location inside city limits delayed, Graf and Reagan could only watch as Farmhouse and then Solful made good on their permits and opened Petaluma’s first two cannabis storefronts. Back at their tiny shop on Ely, Down Under Industries felt the hit, Reagan said. 

“We have had ups and downs with the number of customers served since the new stores opened,” she said. “I recognize that people have to pass two other stores now before they get to our existing space. So we hope that we will recapture some of the audience by having another location that's more conveniently and centrally located.”

Meanwhile, business has been brisk at Farmhouse and Solful since they first opened their doors to Petaluma customers about eight and five months ago, respectively, their owners say.

“We’ve met or exceeded what we were expecting to by this point,” said Claire Firestone, who owns Farmhouse with her husband, James Clark. And that comes without eating into their own long-running delivery business. 

“We have some people who have transitioned just to shopping in the store, but there is definitely a demand for both,” she said. “We have people who go back and forth between delivery and in-person, depending on what’s more convenient at the time. And I think having the stores gives the delivery more exposure, so both businesses are continuing to grow.”

Meanwhile at Solful’s new shop in Petaluma, the company has seen what Chief Executive Officer Eli Melrod considers its strongest opening yet. The company launched its first store in Sebastopol in 2017; its second in Santa Rosa in 2022 (closing it two years later in 2024, a move Elrod attributed to a variety of factors including location); its third in San Francisco in 2023; and its fourth in Healdsburg in October 2024, just months before securing a permit to add another Sonoma County shop in Petaluma. The company also offers delivery across Sonoma County, but not in San Francisco. 

“We’ve been really happy with business in Petaluma,” he said. “You never know what it’s going to be like opening a new store in a new community, and we have certainly hit our projections for this market. We feel like things really couldn't have gone any better in Petaluma. … I’d say this is our fastest growth we've seen in a new market in terms of sales growth.”

Shops eye adding lounges

All three businesses say they hope to continue to grow. 

With their new cannabis storefront finally ready, Graf and Reagan of Down Under Industries will turn their attention toward adding a new take-out coffee and tea company called Spill the Tea, which they also own, to their new building – just across the hall from Down Under.

The couple also hope to expand their footprint and add a cannabis use lounge at their Ely Road location beyond city limits. The leased, one-acre parcel includes a mechanic shop called Transman that is owned by Reagan’s stepfather, Monte Cooper, who will be retiring this year, Reagan said. Sonoma County already has one cannabis consumption lounge, at Mercy Wellness in Cotati, which opened in March 2025.

“We're going to convert some of our space to make it sort of an indoor-outdoor experience, provided it all goes through,” she said. “I can't say how the approval process will go, as I haven't started the application yet.”

Farmhouse co-owner Clark said he’s interested in opening a lounge, as well, which would depend on the city changing its cannabis ordinance to allow them. “It could be a touchy subject,” he acknowledged. “What you’re saying is, ‘Hey, I want to get people stoned and then send them off.’ That’s a tough pill to swallow for a lot of people. But quite honestly, we do it with alcohol all day.”

There’s also the prospect of adding another location outside Petaluma, Clark said: “I think everyone in our position would love to have more stores.”

Solful, for its part, isn’t eyeing any more dispensaries in the county or elsewhere at the moment. “We’re focused right now on expanding our product program,” Melrod said.

In addition to being a retailer, the company also manufactures its own branded products from cannabis grown by craft producers like Petaluma’s Sonoma Hills Farm, which overcame neighbor opposition organized by the group “No Pot on Purvine” to open its cannabis-and-vegetable farm north of town on Purvine Road in 2019.

Nate Seltenrich is an editor and reporter at Petaluma Voice. He can be reached at nseltenrich@petalumavoice.org.