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Are smaller brewpubs over and out?

Local brewpubs closing at unprecedented rate

Readers of San Diego Beer News are hip to the fact new brewing companies are opening at a rapid clip, with a glut of other businesses working their way to their public debut. But the consistent reader is also aware that brewing companies are starting to close with greater regularity than we’ve seen over the past decade, as well. La Jolla Brewhouse, El Cajon Brewing Company and The Brew House at East Lake have all shuttered within the last year alone.

Three businesses might not seem like much, but considering there are only around 70 brewhouses total in San Diego County, it represents nearly five percent of the entire local industry. Throw in Mad Lab Craft Brewing, the Otay Mesa brewery that closed its facility with plans of reopening as a manufacturing-only brewery next year, and that percentage rises. But wait, there’s another local business calling it quits, one that’s the most surprising of all—Rock Bottom Brewery & Restaurant (401 G Street, Downtown).

The brewery restaurant’s 15-year lease is about to expire and Rock Bottom’s parent company, Craftworks Breweries & Restaurants (who also own Gordon Biersch, has decided to close its store rather than renew. The last day of business at that spot will be October 5. Up Interstate 5, Rock Bottom’s award-winning, longer tenured La Jolla brewpub will remain open.

On top of this news, word on the street has it that the owners of Pizza Port are looking to unload their unincorporated brewpub Bailey’s Wood-Pit BBQ> (2307 Main Street Julian). Opened in late 2011, it’s the place of origin for the beers of Julian Brewing Company, which used to be helmed by former Bailey’s partner Tom Nickel, but has been helmed by Pizza Port’s Mike Gabbard and co-owner Vince Marsaglia since Nickel’s departure.

It should be noted that all of the closed or shutting down businesses mentioned in this article are brewpubs, restaurants with on-site brewing facilities. Certainly, the model itself can work in San Diego. The quartet of Pizza Port’s in San Diego are busy and some have been named the best of their kind in the country. Karl Strauss Brewing Company's brewery restaurants do well, and the newly opened Stone Brewing World Bistro & Gardens – Liberty Station is selling plenty of its house beers. It would seem the small, single outposts are the ones having trouble.

Craft beer fans talk all the time about market saturation and bubbles bursting. Could the first example of this be found in the brewpub sub-sect of the industry? Are there too many businesses for a smaller or newer operation to survive amid larger, more established and successful contemporaries?

Disclosure: In addition to his work as a journalist, Brandon Hernández is employed by Stone Brewing Co.

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Readers of San Diego Beer News are hip to the fact new brewing companies are opening at a rapid clip, with a glut of other businesses working their way to their public debut. But the consistent reader is also aware that brewing companies are starting to close with greater regularity than we’ve seen over the past decade, as well. La Jolla Brewhouse, El Cajon Brewing Company and The Brew House at East Lake have all shuttered within the last year alone.

Three businesses might not seem like much, but considering there are only around 70 brewhouses total in San Diego County, it represents nearly five percent of the entire local industry. Throw in Mad Lab Craft Brewing, the Otay Mesa brewery that closed its facility with plans of reopening as a manufacturing-only brewery next year, and that percentage rises. But wait, there’s another local business calling it quits, one that’s the most surprising of all—Rock Bottom Brewery & Restaurant (401 G Street, Downtown).

The brewery restaurant’s 15-year lease is about to expire and Rock Bottom’s parent company, Craftworks Breweries & Restaurants (who also own Gordon Biersch, has decided to close its store rather than renew. The last day of business at that spot will be October 5. Up Interstate 5, Rock Bottom’s award-winning, longer tenured La Jolla brewpub will remain open.

On top of this news, word on the street has it that the owners of Pizza Port are looking to unload their unincorporated brewpub Bailey’s Wood-Pit BBQ> (2307 Main Street Julian). Opened in late 2011, it’s the place of origin for the beers of Julian Brewing Company, which used to be helmed by former Bailey’s partner Tom Nickel, but has been helmed by Pizza Port’s Mike Gabbard and co-owner Vince Marsaglia since Nickel’s departure.

It should be noted that all of the closed or shutting down businesses mentioned in this article are brewpubs, restaurants with on-site brewing facilities. Certainly, the model itself can work in San Diego. The quartet of Pizza Port’s in San Diego are busy and some have been named the best of their kind in the country. Karl Strauss Brewing Company's brewery restaurants do well, and the newly opened Stone Brewing World Bistro & Gardens – Liberty Station is selling plenty of its house beers. It would seem the small, single outposts are the ones having trouble.

Craft beer fans talk all the time about market saturation and bubbles bursting. Could the first example of this be found in the brewpub sub-sect of the industry? Are there too many businesses for a smaller or newer operation to survive amid larger, more established and successful contemporaries?

Disclosure: In addition to his work as a journalist, Brandon Hernández is employed by Stone Brewing Co.

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Comments
9

El Cajon Brewing Co was a trainwreck before it ever opened; what with the hundreds of thousands of dollars given to the business by the City of El Cajon.

Aug. 21, 2013

I think we've seen the peak in the brewpub market. Now it's going to find it's natural level.

Whenever I think of brewpubs, I think beer is the point, food is the afterthought. So I find someplace else to eat.

Aug. 21, 2013

I think anyone who regularly goes to brewpubs and went to the ones closing knows why they are closing. I am surprised some of the longer running places that haven't really adapted are still in business. The higher quality brewpubs seem to be doing great still.

Aug. 21, 2013

I think a lot of people that are part of the San Diego craft beer culture are quite knowledgeable, so they've come to expect high quality. Personally, if I go into a place and the tap list/bottle list is weak, and the food is just mediocre, I will not return there. There's far too many good options around town to settle on "just okay." I think the market is just weeding out some of the weaker spots. If a place is also brewing, it better be really good...otherwise, they'd be better off just focussing on good food and a solid tap list.

Aug. 21, 2013

The 3 that are closing/closed are for obvious reasons. El Cajon Brewing Company is going to open back up as under different leadership and with different brewers, and it sounds like something the craft brew market can get behind.

Bailey's going out of business, well that sounded like there were problems from the start. Maybe Tom Nickel will buy it back and do what he wanted to do there in the first place! hint, hint Tom!!!

Rent downtown? WHY? What business there even lasts 15 years? More power to Rock Bottom for doing it. Once the lease was up I am sure the rent skyrocketed.

Basically, a gazillion factors were missing from this article that justifies the changes instead it is just inciting a lot of silly gossip.

Jessica

Aug. 21, 2013

Rock Bottom Gaslamp was a relic of a bygone era. A tip of the hat to their brewer and them carrying the craft beer torch between the eras, but the "craft beer by day, night club by night" model always was weird, and The Yard House pretty much took over as the corporate place.

The La Jolla Brewhouse is set to reopen as the La Jolla Brewing Company relatively shortly, right? I'm not sure there is room for both them and the Public House in that area, but we'll see.

Aug. 21, 2013

The establishments that closed did so for good reasons... No matter how hot a market is, if the product, service and or management are weak, then eventually they will close. I'm disappointed in the gossipy nature of this article... Brandon, you are a better reporter/writer than this...

Aug. 21, 2013

I'm a little late to the party (just realizing that SD Beer News no longer shows up in the list of other staff blogs and I've been missing out), but I've got to agree to some extent with some of the comments here.

El Cajon Brewing beers, the one time that I visited, were underwhelming. And the scene was pretty depressing - on a Saturday evening around 8:00 there were maybe a dozen seniors gathered around a couple appetizer plates sipping water and perhaps hosting a sewing club meeting. No one else - my party had one round (at least a few people ordered different beers and let me try them) and left before we even got to order food.

LJ Brewhouse was notorious for problems with its brewer/owner relations (Brandon has documented this), and I never got anything beyond mediocre/slightly disappointing service the handful of times I was in there.

Bailey's imminent closing/changing hands is probably the result of an also well-publicized rift between owners. I hope someone picks up the torch and runs with it, I've heard good things about the place but haven't been up to Julian to pay a visit.

Rock Bottom, really more a chain restaurant than a craft brewery, isn't a huge loss in my eyes. As mentioned, they'll still have one local outpost, and the multiple personality disorder, as well as the tremendously competitive nature of the high-rent district downtown, probably just aren't a fit when what they're doing isn't as unique as it was ten years ago.

Still, it's a shame to see any business fold. The upside is that two of these four have a chance of reopening/staying open with new owners in place, and the new Stone near me is so busy I haven't even been able to get in the few times I've tried to venture down.

Aug. 23, 2013

I brewed beer and taught others how back when that was still felony bootlegging. Ending up with the Brewmaster Degree, I did all that long before the advent of the micro-breweries. Good to hear that they are mostly doing okay, now that 99.9% of the world beer is brewed by only two entities: Miller-Coors-Tecate-Heineken (Phillip Morris Tobacco), and Anheuser-Busch-Budweiser-Modelo-Corona-Pacifico. I really out to come out of retirement and either teach or brew. Dr. John Kitchin

Aug. 23, 2013

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