While the nation’s 50 states remain divided on the legalization of marijuana, New York’s Compassionate Care Act has freed marijuana companies to open dispensaries in the nation’s largest city, capturing the attention of accredited investors nationwide.

The law legalizes certain types of medical marijuana in the Empire State and is expected to lead to the opening up of the state’s first marijuana dispensary in New York City in January—a development seen by some as a significant boost to bringing more investment dollars into the cannabis industry.

“We are receiving inquiries from family offices, funds and other more traditional investors looking for ways to invest in legal marijuana on the East Coast,” said Leslie Bocskor, managing partner of Electrum, a consulting company in Nevada that is launching a marijuana-related hedge fund.

Vireo Health, for example, purchased land in Fulton County in upstate New York to construct its grow facility and is renting a building in the borough of Queens that will house a dispensary in preparation for its grand opening in January.

The four other pot dealers that were granted licenses by the New York Department of Health are Bloomfield Industries, Columbia Care NY, Etain and PharmaCann.

“The New York market will see much more sophistication much sooner, whereas it took years in other states for their operations to mature,” said Troy Dayton, CEO of the ArcView Group, a marijuana investment and research firm.

Vireo Health founder Kyle Kingsley plans a $30 million national capital raise to launch dispensaries in other states, but is steering clear of private equity and venture capital money at this time. “We prefer private investment from high-net-worth individuals who come with no strings attached,” Kingsley told Private Wealth. “We want to maintain control of the enterprise."

So far, no institutional investors have come forth, he added. “They are taking meetings, but as long as marijuana is classified as a Schedule 1 drug by the [federal] government, we don’t expect institutional investors to invest,” said Kingsley.

Investors must be cautious about where they invest their money because the Schedule I category under the Controlled Substances Act is the Drug Enforcement Administration (DEA)'s most restrictive level.

“Unless and until the federal government de-schedules marijuana or at least re-schedules it, we will see the same complications on investment, investing and banking issues in New York that we’ve seen in every other legal state,” Savino said.