E-Malt.com News article: USA, PA: Appalachian Brewing Co. to expand its operations in Harrisburg

Just as Troegs Brewing Co. left Harrisburg and took off for the Hershey area in order to grow its operations, the city-based Appalachian Brewing Co. says it’s bursting at the seams and needs to expand its current location on Cameron Street, pennlive.com reported on September, 11.

But to do so, it will need the help of the city because Harrisburg owns the two abandoned buildings that the brewery has its eye on, just south of its current location.

Last week, brewery officials met with Mayor Linda Thompson and made their pitch to acquire the land at 38-40 N. Cameron St. for a $500,000 to $600,000 warehouse that would house bottling and packaging materials for its 6,000-barrell-a-year brewery.

CREDC (Capital Region Economic Development Corporation) is also involved in the project. But there are snags.

Most importantly is the estimated $300,000 cost to demolish the existing, deteriorating structures and prepare the site for development.

Appalachian Brewing CEO Jack Sproch said the land isn’t worth the cost of demolition, which is why the company is looking to the city and CREDC to come up with a plan and grant funding for preparing the site so the company can build the warehouse.

“Those old buildings are upside down in terms of cost,” Sproch said. “It would cost more to remove them than the land is worth. If it was just the price of the land, I’d be happy to pay the market value for the land.”

Sproch described the meeting with the city as productive, but said he realized Harrisburg would have to do its due diligence in terms of studying the project and establishing a process for preparing and marketing the property.

“There are a lot of concerns when you have property owned by the city,” Sproch said. “They want to maximize their return and that’s understandable.”

While not setting a timetable, Sproch said the downtown brewery has reached a point where it will need to expand its current location on the first block of North Cameron Street or move some operations to another site. However, it has no plans to abandon its flagship location, which includes its main brewery, a restaurant and corporate headquarters for a growing company that now includes five locations.

“We are so successful, we are busting at the seams in Harrisburg,” Sproch said. “We have been committed to Harrisburg for a long time. But we are really up against the wall in terms of manufacturing space. We would probably have to move some of that to another site.”

Appalachian Brewery has struck deals with the city before. In 1995, it secured its flagship site of a former printing building for just $1, as part of a Harrisburg economic development initiative. The company then spent two years and $1.2 mln turning the 50,000-square-foot space into its brewery, bar and restaurant, which opened in 1997.



14 September, 2012