Lagunitas is movin' in .....

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Lagunitas to open brewery in Chicago

California-based craft beer maker, one of the fastest-growing in the nation, is poised to lease a former steel factory in the Douglas Park neighborhood

April 11, 2012|By Josh Noel, Chicago Tribune reporter

Tony Magee, founder and owner of Lagunitas Brewing, one of the nation's fastest-growing craft breweries, released a photo on Twitter on Feb. 24 that showed a brown-haired woman in a massive hangar-like space below the words, "What would YOU do with a space like this?"

The woman was Magee's sister, Karen Hamilton, who works in marketing for the brewery. And the space? It turns out Magee was working on bringing Lagunitas east to Chicago.

Late Monday, Magee announced (again, on Twitter) that the Petaluma, Calif., brewery would nearly double its production by opening a brewery in Chicago, his hometown and where Hamilton still lives. Lagunitas is closing in on a five-year lease on a former steel factory at 18th and Rockwell streets in the Douglas Park neighborhood, behind Cinespace Chicago Film Studios. The lease would include multiple options keeping the brewery there for at least 20 years, Magee said.

It easily would make Lagunitas the largest brewery in the city, apparently with a larger system than every other Chicago brewery, including longtime dominant player Goose Island, combined.

Though a lease is not signed, the parties have crafted a letter of intent, and Alex Pissios, who manages Cinespace, said he is confident the deal will be formalized. The number of jobs the new brewery would create will be announced in the coming weeks, Magee said.

In beer drinking circles, the news was as huge as it was surprising. Lagunitas' growth has been rapid, with its 2010 sales jumping 38 percent from the previous year, according to the most recent statistics from the Brewers Association. This year's sales are up 55 percent from last year, the brewery says.

Sales were $39 million last year, and the brewery is on pace to hit $60 million this year, Magee said.

Magee said he has long been concerned about both the money and diesel emissions expended while shipping beer to the 32 states where Lagunitas is available. In February, while driving to work, he was struck with an idea: Instead of spending all that money to ship the beer thousands of miles, what about opening a second brewery in Chicago?

The savings from avoiding trucking the beer across the country will finance the new operation, Magee said. The brewery plans for all Lagunitas beer distributed east of the Rocky Mountains to be made in Chicago.

Sierra Nevada and New Belgium breweries recently have announced similar expansions from their bases in California and Colorado, respectively, to Asheville, N.C. Magee said there was nowhere he wanted to be other than Chicago.

"It's frickin' Chicago, man," he said. "It's the crossroads of the country. There's only one Chicago. And I'm from there, so I understand it."

He flew out for two days at the end of February, looked at about a dozen spaces, then showed his two favorites to Hamilton. Upon seeing the 150,000-square-foot Cinespace property and its 57-foot ceilings, Hamilton said she thought, "This is Lagunitas."

"When Tony called me in February and said he wanted a Realtor to look at space, I was thinking of just a warehouse space" for storing beer brewed in California, Hamilton said. "Then he said, 'No, listen to this,' and it made total sense."

Magee said he has placed an order for a 250-barrel brew system identical to the one being installed at his Petaluma brewery. The Chicago version should arrive in July 2013, Magee said, and will be in use by the end of that year. In recent years the brewery has operated in Petaluma with an 80-barrel system. One barrel, which is the unit of measure in the beer world, produces two kegs.

Magee said he plans to open a tasting room in the center of the new brewery, surrounded by his new system and fermentation tanks. Staff will likely offer tours and sell typical brewery swag — T-shirts, key chains and the like — as well as the freshest Lagunitas beer Chicago has tasted, most likely in growlers.

The city and brewery already have a deep relationship. In recent years, Lagunitas has brewed several Chicago-only beers with input from the likes of Big Star, Publican and other restaurants.

"We could do some very local stuff," Magee said. "But everyone who drinks in Chicago will know the beer is fresher and doesn't have as many miles behind it when you pop the cap."