The financial fallout of Green Flash
Owner of the West Coast IPA trademark, and the first modern San Diego brewery to distribute to all fifty states, Green Flash Brewing Company spent several years in expansion mode prior to 2018, purchasing Alpine Beer Co. and establishing breweries in other states. But in April 2018, the company abruptly announced it had gone into foreclosure. Green Flash Brewing Company was dissolved, and its assets were sold by its lender, Comerica Bank. As it turns out, a private equity group led by Richard Lobo, who had joined Green Flash board of directors in April 2017, had prearranged a deal with Comerica to buy enough assets to keep Green Flash and Alpine brands going. Local beer fans rankled as they learned the new entity, WCIPA, LLC, would move forward, installing Green Flash founder Mike Hinkley as an executive in the new corporation, while investors and shareholders of the original businesses were left behind.
Beloved brewery closures
If the Green Flash saga proved that even larger, well-established, regional beer producers were vulnerable to rapid changes of a crowded craft beer market, 2018 showed that smaller breweries were even more at risk. This year, the number of breweries in the United States topped 7,000, increasing competition across the nation. With more breweries than all but three American cities, San Diego has started to feel this pressure, and 2018 witnessed the closing of several of the region’s most talked about breweries. Intergalactic Brewing Company, Monkey Paw Brewing, Council Brewing Company, ChuckAlek Independent Brewers, and Toolbox Brewing Company — all of them award-winning breweries — closed this year, surprising observers, including this one. Larger breweries attract beer drinkers to San Diego, but it’s the quantity and quality of our small brewery class that cements our city as a craft beer mecca. We count fewer of those heading into 2019.
Beer offered a positive border narrative
Nationally, the border with Mexico proved a source of controversy in 2018, which lingers into the new year. The relationship between San Diego and Mexican brewers grew closer than ever. Borderland collaborations became the norm, as beermakers crossed in both directions to share brewing methods and inspiration with one another. Over the summer, Bay Park based SouthNorte Beer Co. became the first San Diego craft brewer to establish a permanent brewhouse south of the border, operating within Tijuana’s popular Telefónica Gastro Park. The results have been beneficial to beer drinkers in both nations, and in particular Baja, whose craft breweries set the pace for their nation.
Hard kombucha finds its niche
Three years ago, the mixed fermentation tea known as kombucha was a musty topic restricted to health food circles. However, the success of Chula Vista’s Boochcraft has established high alcohol, or hard kombucha, as a thriving adult beverage market. As Boochcraft readies a massive brewery expansion that stands to grow its brand exponentially, other entrants joined the hard kombucha market around the nation in 2018, including North Park’s JuneShine. It seems to have more parallel than overlap to the beer market, but moving forward you’re likely to find hard kombucha most places beers are sold.
The return of brewpubs
San Diego craft beer didn’t start with production breweries, but with brewpubs. But as craft beer began to trend nationwide, startups mostly abandoned the brewery/restaurant model to open production breweries focused on serving beer only. However, 2018 saw a rise in breweries embracing food service as a facet of doing business. New to San Diego’s brewery community this year were Fourpenny House, The Bell Marker, Melvin Brewing, CAVU Brewing (formerly Absolution by the Sea), Julian Beer Co., and Attitude Brewing Company — each of them established as brewpubs. Meanwhile, breweries including Culver Beer Co., Belching Beaver Brewing, and Latchkey Brewing have added retail food to their breweries, with Latchkey Brewing soon to follow suit. Lastly, existing breweries Duck Foot Brewing Company, Amplified Ale Works, and Modern Times Beer each opened tasting room locations doubling as restaurants.