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Friday, January 3, 2020

THE BREWSPAPER / HELLOS & GOODBYES IN SAN DIEGO’S CRAFT BEER SCENE 2019




GUEST BLOG / By Brandon Hernandez, Senior Editor, West Coaster Beverage News [www.westcoastersd.com]--I have been closely covering the San Diego beer beat for more than a dozen years. Over that span, the industry has gone through many ups and, in more recent years, its fair share of downs. Through it all, local craft has remained rather healthy, despite declines that are more the product of nationwide trends versus factors unique to our region.

The important role craft beer plays in our county is well known to a large percentage of San Diegans, who have bore witness to its rise and cementing in local culture. As such, news of brewery closures, contraction, acquisitions, layoffs, cutbacks, declining sales, increased competition and the like tend to hit hard with those following the industry. Even a journalist such as myself (one who worked in the beer industry for the past seven years and saw, first-hand, how difficult the beverage sector has become for craft-brewing interests) tends to react more strongly to bad news than good news and lose sight from time to time.

But it’s important to take a step back, put things in perspective and really analyze where things stand. The end of the year seems a good time for that. While I won’t attempt to sugar-coat the fact that this is one of the most challenging times for craft beer producers in the modern era, what with the rise of alternative alcoholic beverages (led by hard seltzer), competition from more expansively and expertly equipped macro-beer rivals and a host of other inhibitors to success, I am not about to sound the death knell for an industry that, though facing unforeseen adversity, seems to be weathering it all relatively well, especially in San Diego County, where there are more than 150 operating breweries and even more brewery-owned public venues. But that’s not to say there weren’t some casualties in 2019.

Ten interests ceased operations within the county over the past 12 months. Two of those were local links in larger brewpub chains. The Bell Marker faded away after the business it was housed in was sold to the operators of Owl Drug Co. Meanwhile, Gordon Biersch closed its Mission Valley brewery-restaurant. But there’s a silver lining there. Not only will it reopen in 2020 under new management as Puesto Cerveceria, making it a truly San Diego interest for the first time in its lifespan, it will soldier on under the direction of longtime brewmaster Doug Hasker. Beyond these spots, only one of the shuttered interests would qualify as sizable by most beer fans’ standards—Benchmark Brewing, a six-year-old, Grantville-based business which also had a tasting room in Bay Park. Others had significant production capabilities, such as Oceanside’s Midnight Jack Brewing, but were unable to generate sales to make good on them. Smaller breweries also struggled to realize their ambitions, including La Mesa’s Scottish-themed Fourpenny House brewpub, National City’s would-be trailblazers Embarcadero Brewing and Supply, and Barrio Logan’s Alta Brewing.

The biggest single area to be plagued by closures was Miramar, where three breweries departed. Ceasing operation in March was Reckless Brewing, which opened across the street from Ballast Point Brewing‘s Carroll Way headquarters in 2015 as the second coming of Wet ‘N’ Reckless Brewing, the original location for which burned down in 2014. In September, the married owners of 2kids Brewing made the difficult decision to call it quits. Despite its small size, 2kids had a fervent if not a-tad-too-small following and managed to lend a helping hand to fellow Miramar breweries and charitable causes during its six years in business. Then there was Barrel Harbor Brewing, which closed its Miramar tasting room over the summer, followed by its Vista brewery in October, before its owner was able to reopen the latter this month, bringing total closures for the year down to nine.

My point is not to minimize any of the misfortunes of the aforementioned business owners, but remind that in every industry everywhere, companies go out of business for a variety of different reasons. The more businesses there are, typically, the higher the rate of attrition. It’s statistical, but when paired with constant business reporting about declining revenues and the steps breweries must take to compete, maintain and, in some cases, survive in such a climate, it’s easy to believe the sky is falling or that the San Diego brewing industry is weak, fading or facing extinction. This is far from accurate.

Beer quality across the county remains strong, even among new and younger interests. In years past, as one would expect from lesser-tenured operations, that has been a softer link in the county’s fermentation chain mail, but consumer confidence remains high. Though keeping afloat has largely replaced increasing distribution footprints and revenues as key goals for many brewery owners, numerous breweries—even some of the larger interests—are actively growing, adding on square-footage or new locations altogether. Again, there are more brewery-owned production facilities and public venues in the county at present than ever. This is partially the result of 26 new spots that opened this calendar year.

Nine of those represent new entrants to the San Diego beer scene. Whereas in previous years, much growth has consisted of small-if-not-nano, neighborhood-focused breweries, with the exception of San Marcos’ Stave and Nail Brewing, which is open just one weekend per month, all of these newcomers are of legitimate size and production capacity. Four of them—Sorrento Valley’s Gravity Heights, University Heights’ Kairoa Brewing, San Marcos’ My Yard Live and North Park’s The Original 40 Brewing — are brewpubs and, while not all geared for duplication or world domination, they have the means to produce beer for sale beyond their four walls, as well as veteran brewers and beer quality to get them there if they play their cards right and take care of business on their home turf. Widespread recognition of the importance of having on-site food, a welcoming environment and attractors beyond beer have led to the rise of brewpubs as the new “neighborhood brewery” option of choice for entrepreneurs.

On the expansion front, none went as big as Eppig Brewing. Born out of a meager lease-to-brew space at North Park’s Brewery Igniter campus, this three-year-old maker of Germanic lagers and West Coast IPAs alike was the first to successfully exit H.G. Fenton’s proof-of-concept vehicle. In doing so, they moved on up, literally and figuratively, into a 16,000-square-foot, new-construction headquarters in Vista (next door to new business Dogleg Brewing) with dual tasting rooms (one of which is a high-ceiling beer hall) and an eventual production capacity of 10,000 barrels. It’s the largest leap in manufacturing capability for a local brewery in years. Further south, Eastlake-based Novo Brazil Brewing upped its production and presence in a big way, as well, opening a 12,000-square-foot brewpub in the heart of Chula Vista’s Otay Ranch Town Center. It would seem that, with proper planning, quality and execution, success—and growth—are still possible, even in the current, harsher industry climate.

Waving a taunting finger at the many who believed the off-site tasting room trend was dead, the majority of the new venues opened in 2019 were brewery satellites. A dozen opened, and while new, Scripps Ranch-based Harland Beer Co.’s operates out of Del Mar Highlands’ high-rent One Paseo mixed-use development, and Pure Project Brewing‘s satellite is seated as a cornerstone of a new-construction high rise in Banker’s Hill, the current trend is renovating low-rent, sometimes salvaged spaces such as the trio picked up by Miramar-based Little Miss Brewing in Escondido, La Mesa and the East Village, the La Mesa cocktail lounge now operated by Bolt Brewery, or the former home of the defunct Fallbrook Brewing that got picked up by Vista’s Prohibition Brewing.

So where are we now…really? There is no telling for certain. The beverage industry is in greater flux at present than in any time I can personally recall, but such has been the case for years. Being midway through these exciting times means adjustments, pivots and other maneuvers have already been made by the majority of the county—and the country’s—brewing companies. These largely reactionary moves have resulted in varied levels of success (and failure) for those attempting them. In some cases they have spurred something somewhat rare for a craft brewing community that has been so focused on keeping up with the rapidly growing demand of the past decade-plus that it hasn’t had time to take a step back—progressive actions. This would represent a very helpful and positive trend moving forward. It’s one of many areas of opportunity and promise for an industry that’s still going gangbusters as opposed to scores of other high-profile American industries, some of which are in full tailspin or, indeed, on the brink of extinction. Beer is not. Beer isn’t going anywhere and, while these may be difficult times for those producing it, it would seem, to me at least, that to bet against beer, and more so, the determined people who’ve made it into such a beloved, appreciated, solid staple of our local diet and economy, would be ill-advised.

HELLOS

* 13 Point Brewing, Lemon Grove
Black Market Brewing—SDSU, College Area
** Bolt Brewery Cocktail Lounge, La Mesa
Carlsbad Brewing (Acoustic Ales Brewing Experiment), Carlsbad
* Dogleg Brewing, Vista
Eppig Brewing, Vista
* Gravity Heights, Sorrento Valley
** Guadalupe Brewery, Vista
* Harland Beer Co., Scripps Ranch
** Harland Beer Co.—One Paseo, Del Mar Heights
* Hopnonymous Brewing, Kearny Mesa
* Kairoa Brewing, University Heights
** Kilowatt Brewing, Oceanside
** Little Miss Brewing, East Village
** Little Miss Brewing, Escondido
** Little Miss Brewing, La Mesa
** The Lost Abbey Sanctuary—San Elijo, San Marcos
** Mike Hess Brewing, Imperial Beach
** Modern Times Beer Co. Invigatorium, East Village
* My Yard Live, San Marcos
Novo Brazil Brewing—Eastlake, Chula Vista
* The Original 40 Brewing, North Park
** Prohibition Brewing, Fallbrook
** Pure Project Brewing, Banker’s Hill
* Stave & Nail Brewing, San Marcos
** Thorn Brewing, Mission Hills

* – New business
** – Satellite tasting room, no brewing capabilities

SUBTRACTIONS

2kids Brewing, Miramar
Alta Brewing, Barrio Logan
The Bell Marker, Downtown
Benchmark Brewing, Grantville & Bay Park
Embarcadero Brewing & Supply, National City
Fourpenny House, La Mesa
Gordon Biersch, Mission Valley
Midnight Jack Brewing, Oceanside
Reckless Brewing, Miramar



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