USA, MI & IL: Detroit’s Atwater Brewery plans small-scale production brewery in Chicago by spring 2018

Of the hundreds (or thousands, or seemingly millions) of beer brands on Chicago shelves, plenty of out-of-towners have fared quite well. Chicago is, for instance, one of Allagash Brewing’s strongest markets, even though that brewery sits in Portland, Maine — more than 1,000 miles east, Chicago Tribune reported on August 1.

There has been no such luck for Detroit’s Atwater Brewery. Founded in 1997, Atwater is a decent-sized brewery (production is expected to be up to 50,000 barrels this year) with distribution in 23 states. But it has been unable to win Chicago's beer-drinking hearts or minds — not to mention its store shelves or bar taps.

The lack of penetration has led Atwater founder Mark Rieth to plan a small-scale production brewery in Chicago by spring 2018. He hopes to have a site announced by the end of the year. The brewery would include a taproom, restaurant and outdoor space for a beer garden, he said.

"We’ve been studying the market in Chicago for more than a year, and it’s a very important market," Rieth said. "Our presence there is not what we want it to be. This would be the next step."

Many lofty beer industry plans fade away with barely a whimper, but Rieth said he is "more than 90 percent sure" that Atwater will build a Chicago brewery.

The move would reflect a burgeoning trend of regional or national brewers opening smaller outposts elsewhere. Stone Brewing, based outside San Diego, has opened locations across California; Firestone Walker, of central California, has opened in Los Angeles; Chicago's Goose Island plans a brewpub in Toronto; and Lagunitas, which has large production facilities in Northern California and Chicago, plans to rebrand an existing brewpub in Charleston, S.C.

Best known for its Vanilla Java Porter, Atwater has distributed beer in Chicago since 2012. However, its initial distributor, Central Beverage Co., sold the company's portfolio to Lakeshore Beverage early in 2015. Rieth called the move a setback.

"On the distributor side, we haven’t had continuity," Rieth said. "You have to have a true partner to make (growth) happen."

Atwater previously distributed in Chicago via Windy City Distributing, but that relationship ended in 2008. Atwater plans to hire a representative in Chicago to build the brand’s presence in the short term.

An Atwater brewery in Chicago would operate a fairly small system — five or 10 barrels — and make beer only available in its taproom and around Chicago, Rieth said. Its core brands would continue to be imported from Detroit.

“It’s a branding opportunity to get closer to our customers and have them understand our culture,” Rieth said. “We’re not trying to be a Chicago brewery. We’re trying to bring a little bit of Detroit to Chicago.”

A Chicago brewery would be part of an ambitious expansion for Atwater, which aims to brew 200,000 barrels by 2020 and plans large breweries in Austin, Texas, in 2017 and North Carolina in 2018 or 2019, according to Crain's Detroit Business. Atwater is also exploring opening a small brewery in Boston.

02 August, 2016