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STONE BREWING’S INTEREST IN GREENSBORO INDICATIVE OF LOCAL CRAFT BEER BOOM

by Whitney Kenerly

whitney@yesweekly.com

On February 28 a Facebook page was created by Greensboro Partnership Economic Development to publicize their efforts to recruit Stone Brewing Company to open their East Coast distribution facility in Greensboro. Since then the page has earned over 2,300 likes and plenty of buzz.

As the industries that built the Triad – cotton and cigarettes – no longer operate huge factories that define Greensboro as a city, craft beer might represent part of the economic future.

There are currently over 100 craft breweries in North Carolina that employ over 10,000 people and generate $791 million a year in revenue. Two leading craft brewers, Sierra Nevada and Oskar Blues, have announced plans to expand their business into major operating bases in Asheville.

Stone Brewing Company is currently the tenth largest craft brewery in the country with headquarters located on a 19-acre farm in Escondido, California, about 30 miles north of San Diego. Their popular Arrogant Bastard Ale has been a mainstay of the brewery since it was introduced in 1997.

Stone Brewing Company listed site requirements in a Request For Proposal (RFP) that indicated plans for both a brewery operations facility and an adjacent hospitality facility that would include Stone World Bistro & Gardens.

The economic impact to Greensboro would be significant. Stone Brewing Public Relations Specialist Sabrina LoPiccolo said, “We’re looking to invest $29 million the first initial year.”

Within three years Stone Brewing would employ 346 people with 200 of those employees working in the 35,000 square foot bistro.

Stone Brewing has requested a site with an ideal existing building that would, “enclose all brewing, packaging, and distribution operations in one minimum 130,000 sf facility with room to expand.” Other site requirements include 33′ minimum ceiling clearance, 8-12 loading docks, and easy access to an interstate or freeway within one mile.

Greensboro Partnership Economic Development Vice President Cyndi Dancy said, “We scanned not only our traditional inventory but tried to go out and look at a lot of different products.”

Stone Brewing visited Greensboro in early June to look at sites and meet with local officials and brewers. Governor Pat McCrory attended a dinner reception downtown on June 5 to show his support for the brewery and the craft brewing industry in the state.

Nussbaum Center President and CEO Sam Funchess said, “We had recommended the building next door.” According to Funchess, the 225,000 square foot building on Elm-Eugene has everything Stone Brewing requested except for loading docks and an additional six acres of land. “When they came they did not call us and come tour,” said Funchess. “We were surprised they didn’t come look at it.”

Sources say that Stone Brewing did tour Revolution Mill, the former location of the Nussbaum Center off of Yanceyville Street near Cornwallis Drive.

The 577,203 square foot property is currently valued at $9.6 million and owned by Historic Revolution LLC.

LoPiccolo said that Stone Brewing is still in the process of visiting other cities on the East Coast. Charlotte was rumored to be on the list of cities considered by Stone Brewing, but the most updated shortlist has the options narrowed down to Norfolk and Richmond, Va., Greenville, S.C. and Cincinnati, Ohio along with Greensboro.

Executive Director of NC Craft Brewer Margo Metzger said, “It’s a real honor to be on the shortlist.” Metzger views North Carolina as a strong contender due to its location and the growing craft beer industry in the state. “I would think that North Carolina would be on the top of your list if you were expanding to the East Coast,” said Metzger. “If Stone decides this is a good fit then North Carolina will be a good partner with them.”

Kayne Fisher, Co-Founder of Natty Greene’s brewery, had lunch with representatives from Stone Brewing during their visit. “We hit it off instantly,” said Fisher. “For the most part we talked beer.”

Fisher sees the expansion of craft brewing in Greensboro as an opportunity for the City to get in on a booming industry. “We’re having a craft revolution,” said Fisher. “It’s right here in front of us. And three of the top five breweries in the state are right here in the Triad.”

A potential drawback to coming to North Carolina would be the steep excise tax that the state places on beer. At a rate of $18 per barrel, the NC tax is the eighth highest in the country. Metzger said, “They’re a little bit archaic,” and said that a lot of southern states continue to heavily tax things such as cigarettes and alcohol in what are known as “sin” taxes.

“The state is benefitting greatly off of this boom,” said Fisher. “The tax could be a deterrent to a lot of people.”

According to Metzger, outside breweries from states like California could be coming from places with excise taxes as low as $0.10 per barrel. Metzger said, “It’s one of the guild’s priorities to lower it.” The NC Craft Brewers Guild met with state legislators on June 17 to discuss getting the tax more in line with the national average, which is about half the rate of North Carolina’s. Metzger said that the issue was a bipartisan one for lawmakers. “I think they see it as a growing industry,” said Metzger. “Beer brings people together.”

The tax is very burdensome to small breweries in the state, but Metzger feels that it is less of an issue for larger breweries like Stone. “There are so many factors in that decision that it’s hard to say,” said Metzger. “They are better equipped to handle that expense than our homegrown breweries.”

Fisher said that West Coast breweries are looking to takeover an untapped market emerging east of the Mississippi. “On the West Coast, over fifty percent of the beer purchased is craft, compared to seven percent on the East Coast,” said Fisher. “There’s plenty of room for growth.”

The people of North Carolina find the craft brewing industry equally attractive. “People are so excited when a craft brewer moves into their neighborhood,” said Metzger. “They really embrace these businesses as part of their community.”

The uptick of craft brewers looking to use local ingredients has crafted ancillary businesses for things like growing and roasting the barley needed for beer.

Fisher recently took his family to a farm in Virginia in order to pick cherries to be used as souring agents in beers for Natty Greene’s. He sees the popularity of craft brews as indicative of a greater cultural change in how people are approaching food and beverage. The young and hip have sophisticated palettes and are spearheading the movement.

Raleigh may have its trendy creative class, Asheville may be famous for artistic progressives, and Charlotte may be overrun with chic young professionals, but Fisher thinks Greensboro can still compete. “Greensboro is cool. We just need to look in the mirror and recognize it,” said Fisher. “You don’t need a handlebar mustache to enjoy craft beer.”

Even if Stone Brewing does decide to move on to cooler pastures, Fisher and others think it will only be a matter of time before another brewer takes interest in the Triad. Metzger said, “I don’t think this will be the last time we’ll hear from the big boys.” !

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