E-Malt.com News article: USA, MI: New brewery preparing to launch in Grand Rapids next summer

Would-be brewery owners Edwin Collazo and Dave Petroelje plan to leverage their individual skills to launch a new craft brewery in Grand Rapids, Michigan, MiBiz reported on November 6.

Collazo, a former financial adviser, and long-time brewer Petroelje plan to open City Built Brewing Company LLC next summer in a mixed-use building in the city’s burgeoning North Monroe neighborhood, just north of downtown.

The entrepreneurs hope to focus the microbrewery on unique beers using flavors such as lavender and sage, as well as stalwart styles such as IPAs.

To make the nearly $1 million brewery a reality, the owners say they relied heavily on the experiences of others, particularly when it came to fundraising.

Currently a brewer at Grandville’s Osgood Brewing LLC, Petroelje decided in the economic downturn that he wanted to start his own brewery, so he turned to his friend and neighbor Collazo for financial advice, which ultimately led to the partnership.

“When Dave mentioned that they had some issues raising capital in the past, I was fairly confident — based on my experience as an adviser — that I had access to people that had investable assets,” Collazo said, referring to his partners’ attempts to start a brewery. “One of the first things I did was spend a lot of time asking other breweries how they started. (It’s) always interesting to hear the brewer tell the story and the actual owner tell the story, because they’re both true but the perspective is so different."

To work through the challenges associated with raising the necessary capital to start a brewery, the two tapped the expertise of Grand Rapids-based Brewers Professional Alliance, a consortium of attorneys, accountants and other professionals who assist craft beer entrepreneurs with getting their businesses off the ground.

By working with the Brewers Professional Alliance, the duo raised $600,000 in capital from a group of 24 investors. The company also received a bank loan to help with purchasing equipment and tenant improvement assistance from the landlord as part of the company’s lease.

The partners said the affiliation with the advisers helped add credibility to their fundraising.

“I think the Brewers Professional Alliance is a good sounding board to make sure our ideas are on track and going the right direction,” Petroelje said. “(It helped) to have that expertise and to know that we are going in the right direction.”

City Built Brewing will enter the market in what remains a growth period for the industry nationally. According to the Boulder, Colo.-based Brewers Association, active U.S. craft breweries now number more than 4,000 as of Sept. 28, the first time since the 1870s that the industry has passed that milestone. That’s up from about 3,000 craft breweries in June 2014.

The industry association estimates another 1,000 microbreweries are currently in planning stages and that about two craft breweries open every day across the country.

City Built remains in the process of finalizing its lease with Grand Rapids-based 616 Development LLC, the development company that’s renovating 820 Monroe Ave. NW into a mixed-use residential and commercial property.

City Built will occupy from 5,000 to 6,000 square feet in the northwest corner of the building. The craft brewery will also feature a menu with Puerto Rican-inspired food.

“We are excited to have a neighborhood brewery in our building and City Built Brewing will be an additional attraction for the Monroe North corridor and the Belknap neighborhood,” Monica Steimle, director of development at 616 Development, said in a statement. “City Built has the potential to shake up Grand Rapids’ thriving craft beer scene and we look forward to their success and growth.”

The brewery will join an unnamed Essence Restaurant Group eatery, a kickboxing studio and pet boutique as ground-floor tenants in the development.

Collazo and Petroelje tapped Grand Rapids-based Lott3Metz Architecture LLC for design services for the space. Grand Rapids-based Honor Professional Management Inc. will handle construction management.

Using a 10-barrel brewhouse, City Built projects it will produce between 320 and 500 barrels of beer annually. Eventually, the craft brewer also plans to package its beers in cans and distribute them to retailers.

The company forecasts first-year sales to reach $900,000.

“I always argue that our numbers are too conservative,” Collazo said. “But I guess it’s better to underpromise and overdeliver.”


08 November, 2015