Part 1 of 2
SAN DIEGO—Between 1986 and 1996, six renowned breweries kicked started the craft brew industry in San Diego County. Since then, those numbers have skyrocketed and as of November 2014, there are more than 95 total operating breweries and brewpubs in the region. That is according to Dave Howard, president of Lee & Associates—North San Diego County. Howard points out that more than half of these brewery licenses have been issued since 2011 and the industry is not showing any signs of slowing down. On the real estate side, he says, he and his team, including Monique Medley and Stephen Crockett, have been working diligently and observing the trends that have shaped this market over the last decade. Globest.com recently caught up with Howard and asked him a few questions about this very hot market and what it means to commercial real estate.
GlobeSt.com: The craft brewery scene is taking off nationwide. Over the past five years we have seen exponential growth in San Diego County. Why is that?
Dave Howard: Popularity in craft breweries has become a nationwide phenomenon, driven largely by a generation who are developing their palates around the craft. San Diego County, specifically, has been impacted by the demand due to its younger demographics. Craft breweries are often the experimental products of young entrepreneurs; a perfect combination for a city which is built around hospitality and entrepreneurship. Because of extensive regulations and large fees that are often associated with brewery occupancy, cities with less restrictive regulations, like those within San Diego County, tend to be well-suited for start-up breweries. Only larger, more established breweries are able to meet regulations of cities whose laws on zoning and sewer restrictions and code compliances are more complicated.
GlobeSt.com: How has the craft brewery industry's expansion throughout San Diego County affected the local economy? How has it changed real estate?
Howard: This industry has had a tremendous impact on the economy. National University System Institute for Policy Research found that in 2013 the industry made $781.5 million in sales and created 2,279 jobs within our region. Trends show that when breweries open, areas nearby also begin to flourish. Restaurants and other retailers begin to arrive while existing businesses receive boosts of patronage due to the increase in foot traffic. Currently, there are more than 95 brew houses throughout San Diego County, occupying over 1 million square feet of commercial property and potentially increasing the revenue and occupancy of real estate around them.
Additionally, the craft brewery scene serves as a large attraction for tourism in San Diego, bringing more revenue to the county. According to the San Diego North Economic Development Council, in 2013 the craft brewery industry's economic contribution of $272.3 million in San Diego County was more than 1.5 times greater than that of Comic-Con International, San Diego's largest annual Convention, which earns the city's economy approximately $177.8 million in 2014.
GlobeSt.com: Do you see this trend continuing?
Howard: Absolutely. Currently there are 95 total operating breweries and brewpubs in the region. More than half of these brewery licenses have been issued since 2011 and demand has not slowed. One driver to this continuing trend is the developing palates of our nation's youth. As their appetites for these complex and tasty beers grow, they become lifelong customers. An interest to our popular beers is also beginning to emerge overseas which will continue to drive expansion and lead to a larger, devoted customer base. Craft brew entrepreneurs tend to favor cities that are friendlier toward the brewery industry, allowing occupancy without the extensive, cumbersome requirements that can be daunting for investors and entrepreneurs. As cities continue to understand and adjust their rules and regulations to suit craft breweries, the industry can and will continue to thrive.
Continue Reading for Free
Register and gain access to:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
