The Princess Margaret Cancer Centre Home Lottery has pulled its “Grand Prize Showhome” in Markham, Ont. after a Global News investigation revealed a legal medical marijuana grow house was located close by that parents say had also caused children at an elementary school across the street to come home smelling like pot.

The $1.285 million fully furnished custom built dream home, which also includes $25,000 in cash for the winner, comes with an unexpected view.

Security cameras and extra ventilation for the grow house can be seen from virtually every window of the prize home and the smell of marijuana permeates the entire neighbourhood.

READ MORE: Grow house near Markham, Ont. school leaves kids reeking of pot

The cancer foundation told Global News it had made the decision to “replace” the house, one of seven properties offered through the lottery, with a cash prize of $1.3 million.

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“It will never open. It is closed to the public. It is not longer a prize in the Princess Margaret Home Lottery,” said Christine Lasky, vice president of the Princess Margaret Cancer Foundation.

“All I can say is that I’m so grateful for Global having brought this to our attention. We acted as quickly as we could.” Tweet This

The organization said in a statement that the homeowner of an adjacent house had a licence issued by Health Canada to legally grow marijuana for personal consumption, adding that the growing of a large number of plants in the house has resulted in an “intrusive odour in the neighbourhood.”

WATCH: Global News has discovered the grand prize home in one hospital home lottery is located next to a smelly neighbour. Jennifer Tryon has a Global News exclusive.

2:46 Lottery dream home located next to marijuana grow-op Lottery dream home located next to marijuana grow-op

Lasky also said that “nobody inside the building organization was aware of this situation” before the decision to pull the home from the lottery, calling it “very unusual.”

“I think it’s the right thing to do. They’ll get the full value of the prize. … We have many other properties that are available in this lottery program. Some people prefer the cash so this could be a very viable option as well,” she said.

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“Obviously we need to inform people that have purchased the tickets already. We need to change our website and communication.” Tweet This

Lasky said the organization did not feel misled by the builder, Treasure Hill Homes, which told Global News it was the last lot they had available to sell in the neighbourhood.

She also said that was “not accurate” and that the charity had put a hold on the lots when they opened to the public.

WATCH: Medical marijuana operation causing a stink in Markham neighbourhood

The neighbourhood was previously the subject of a Global News story, after parents said children who attended a elementary school in the neighbourhood came home reeking of marijuana.

The homeowner, Wei Gao, previously told Global News he didn’t live in the residence but has been growing marijuana there for two years.

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He admitted to having 146 plants for personal medicinal use. His licence was granted by Health Canada after he broke his leg.

READ MORE: Feds say kids shouldn’t have to smell of pot because of grow house

In 2014, the federal agency changed the Marihuana for Medical Purposes Regulations, making home grows illegal.

Current regulations, however, allow for grow-ops only in industrial areas but Gao’s grow house has been grandfathered in under previous rules and therefore is allowed in a residential neighbourhood.

Former Conservative Member of Parliament for Oak Ridges—Markham Paul Calandra said the grow house was “completely unacceptable” last year.

“We have moved very quickly to try and end these grow ops in our community,” he said in the House of Commons. “But the courts are fighting us every step of the way.”

WATCH: Markham marijuana grow house concerns addressed in Parliament

The Princess Margaret Cancer Centre said the decision to pull the home from its lottery was made with the full support of Treasure Hill Homes and the Alcohol and Gaming Commission of Ontario. The company also told Global News it previously did not know about the grow house before the house was built.

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The AGCO said in an email to Global News it had been in contact with the Princess Margaret Foundation regarding the house, adding it had “no regulatory compliance concerns” with the way it replaced the home with a cash prize.

The showhome is described on the organization’s website as “the home you’ve always wanted” with “timeless architectural appeal on the outside and spectacular design on the inside,” in addition to being “beautifully finished to every last detail.”

The charity said a similar $3.7 million Kleinburg showhome listed as their “biggest grand prize ever” is still open for public viewing.

With files from Jennifer Tryon

A grow house neighbouring a prize home offered by the Princess Margaret Cancer Centre Home Lottery is seen in this photo. Global News A grow house neighbouring a prize home offered by the Princess Margaret Cancer Centre Home Lottery is seen in this photo. Global News