Leading global commercial real estate services firm Colliers International Group Inc. (Nasdaq:CIGI) (TSX:CIG) has released a national market study, “Craft Beer Pours into Commercial Real Estate,” exploring craft beer’s booming market share and the industry’s impact on cities across the U.S. Craft breweries are changing the beer market with an evolving economic model that is resulting in broader growth and benefiting a greater number of metro areas, rather than the limited number of markets where the large traditional major breweries are based.
“If recent trends play out, the future is bright for craft beer and the craft brewery market. In the markets we surveyed, there are more than 400 breweries in the planning stages,” said Pete Culliney, Global Director of Research for Colliers International. “If all open as planned, we estimate an additional 3.1 million SF of craft brewery inventory will be occupied, based on typical brewery sizes, boosting the already-burgeoning craft beer industry.”
Key takeaways from this report, gathered across 29 markets with growing craft beer industries, include:
- The addition of new microbreweries and brewpubs will add modest amounts of square footage to each market, but the real impact will be felt through expansion plans of existing microbreweries as they begin to transition into regional brewery operations.
- A number of breweries have recently expanded their operations by opening large facilities across state lines, which will enable them to get their product quickly to an increased number of markets across the country.
- Most notably, California’s Sierra Nevada Brewing Company recently opened a 300,000 SF facility in Mills River, N.C., and Lagunitas Brewing Company opened a new 300,000 SF facility in Chicago.
- Craft breweries are reimagining real estate and revitalizing neighborhoods.
- Craft breweries typically operate in industrial space, as it has the infrastructure in place with access to water, sewers and the power capacity necessary to run a full-scale brewery manufacturing operation.
- Through the repurposing of space, it is not uncommon for a brewery to set up operations in an antiquated industrial building. These opportunities are usually cheap to acquire or lease, bring a sense of character to the brewery and have the potential to offer tax incentives through revitalization efforts depending on programs in local jurisdictions.
- In Colliers’ survey, an estimated 40% of all establishments are located within multi-tenant space with 60% in single-tenant buildings.
- The same survey also revealed that the more mature the local industry, the more likely top craft breweries will make use of retail-industrial space.
- Of markets in the growth phase, an average of 2.3 of the top 3 craft breweries reported use of retail-industrial space, compared to 2.5 of those in the mature growth and stabilization/maturity phases.