Micro-Breweries Quench a Thirst Across the U.S.
The following post is from Managing Director of Coldwell Banker Commercial, Daniel Spiegel
As the summer sun starts to heat up the country, Americans have many ways to quench their thirst from sodas to designer waters. A visit to a ballpark often doesn’t seem the same without a hot dog and a cold beer. While per capita sales of beer have fallen 12% from 20091 levels, the number of craft breweries has exploded. Consumer tastes for artisan breads and locally sourced dairy products is creating a boon from local farmers markets, so does a taste for locally made brew boost communities.
Beer is not an American invention. In the mid-16th century, Virginia colonists tried brewing beer from corn3 in the colonies. The first beer in the emerging country was a shipment which arrived in Virginia from England in 16072. Americans have loved beer since. But it took a couple of centuries for the first brew pub to appear. In 1982, a brewery in Yakima, WA opened serving its own beer at a bar on its premises — and the brew pub was born.2
MICRO-BREWERIES IN SMALLER POPULATION COMMUNITIES
One commonly thinks of the large cities of the Pacific Northwest, such as San Francisco or Seattle, as the home of the brew pub or microbrewery, but breweries have a long history in secondary and tertiary markets across the country which continues to this day. During the 1980s small breweries popped up in Iowa, Arkansas, Oregon and Virginia. It wasn’t until 1990 the first microbrewer moved into the big leagues by producing more than 31,000 bottles2 and exceeding the 25,000 bottle threshold of a microbrewery.
Today many cities and states claim bragging rights to their pilsner, ale and IPA prowess, and almost none are major metropolitan areas.
- Vermont: Most breweries per 100,000 people (2018)4
- Asheville, NC: Most microbreweries per 100,000 residents (2017)5
- Chicago: Most breweries (2017)6
- Phoenixville, PA: Most breweries per square foot (2018)7
- Grand Rapids, MI: Dubbed Beer City USA8
Whatever the category created, communities large and small like to brag about their secret brew(s).
BREW PUBS BOLSTER CITIES
Breweries are not, however, valued for their stout alone. Breweries and brew pubs are draws to downtowns in smaller communities and part of the economic vitality of the area. The three breweries in the City of Fredericksburg, Virginia, for example – Strangeways Brewing, Red Dragon Brewery and Spencer Devon Brewing – all host regular community events and provide significant tax revenue for the local government. “Our three breweries are wonderful amenities for the City of Fredericksburg, enhancing our sense of place, community cohesiveness and overall economic vitality,” said Bill Freehling, the city’s director of economic development and tourism. “We are delighted to have them here.”
BREWERIES AS EMPLOYMENT DRIVERS
According to the Bureau of Labor Statistics9, during the decade ending in 2016, more than half of the new establishments in beverage manufacturing were breweries. There is no better example than in the City of Chico in Northern California where Sierra Nevada Brewing Company is widely credited with spawning the craft beer movement. “Sierra Nevada is the anchor of our economic stability,” said Chico City Manager, Mark Orme. “The company plays a pivotal role in our community, not just as an economic driver, but also as a model for sustainability and best practices.”
“Their impact is huge,” said Economic Development Manager Chris Constantin. “Sierra Nevada sources products locally, and the result is an economic multiplier effect that ripples through the community.”.
The legend of Sierra Nevada Brewing has many other brew startups seeking their fortune in Chico, including Secret Trails Brewing, British Bulldog Brewery, Nor Cal Brewing Company and gluten-free beer maker Ekert Malting & Brewing, not to mention at least a dozen other new tap rooms and brew pubs. “We now have a brewery district,” said Broker Associate Mike Donnelly of Coldwell Banker Commercial DuFour Realty who recently leased space to “The Brew Kettle” tap house and another small independent brewery coming soon. “People like to take their growlers and fill up locally,” said Donnelly. “It’s very sustainable.”
On the east coast, the same model for success is occurring in Mills River, North Carolina just outside of Asheville, where Sierra Nevada has opened a second brewery and tap house.
REAL ESTATE IMPLICATION
Brew pubs and microbreweries offer communities a variety of economic benefits. The attraction of these craft brewing facilities are part of a broader trend toward artisan foods and satisfy demands of millennials who value experiential retail including food & beverage establishments. A 2019 University of Toledo study found that the presence of a craft brewery increased the value of both condominiums and single-family homes when located within half a mile, using a neighborhood of Charlotte, NC in the case study.10 When Stone Brewing went in to a space in downtown Napa, CA the co-founder noted that, in part, his location decision was out of a desire to reclaim a historic property11 and creating increased value through the renovation.
MORE THAN A THIRST QUENCHER
The fast growth of brew pubs and craft breweries are proving to be growth opportunities for urban markets but also smaller cities in which there is strong pride in local business. While Chicago may have taken over as the city with the highest count of micro-breweries, the craft brew movement is the steam powering the engine in many communities and the local real estate markets across the country.
If you’re interested in finding a space for a brew pub or any other commercial property in your city, contact your local Coldwell Banker Commercial office.