Toasting the craft beer hotspots of the U.S.

 —  Article by JLL Staff Reporter

Demand for independently produced craft beer is booming across the U.S., with two new craft brewers opening up every day.

Today there are more craft breweries in this hops-loving country than ever before, according to JLL’s Craft Beer Guide to Real Estate, with states including Alabama, Florida and North Dakota seeing production growth of more than 1,000 percent between 2011 and 2016.

As more Americans head to a local microbrewery, tap room, or regional brewery each year, real estate for this hot market is bustling.

“Vibrant beer hubs tend to have a few traits in common,” says Barnett. “They’re typically located in walkable neighborhoods on the outskirts of a downtown, often in areas where arts are thriving and people in their 20s and 30s are moving in—including young, single professionals as well as parents who can appreciate a family-friendly open pub tap room.”

While vibrant beer hubs have sprouted in cities across the country, it may be easier to start a brewery in one state over another.

“Craft beer makers are finding a warm welcome in many densely populated areas, but it can be easier to succeed in some states than in others,” says David Barnett, Senior Research Analyst, JLL Americas. “State policies dictate some of this, because alcohol laws differ widely from state to state, making it harder to pull off a smaller-size brewery in some areas.” For example, state policies vary on barrel cap production limits, self-distribution rights and onsite sales of beer to-go.

Many states are now relaxing restrictions on beer makers looking to sell directly to consumers—as partially evidenced by the new plethora of taprooms. Pint-friendly policy is just one factor that makes a market viable.

The popularity has been so overwhelming in some areas that oversaturation looms in some markets. But with a truly unique offering, paired with the right location, opportunity can still abound.

Check out the slideshow below for more on the booming craft beer markets across the country.

Oregon

One of the capitals of craft beer, the so-called Beaver State brewed up 1.2 million barrels in 2016 alone, with 8.1 breweries for every 100,000 people of legal drinking age. Portland in particular is rampant with selection; the city’s Close-In neighborhood alone offers more than 10 breweries all in a 2-mile radius. And when the city blocks seem too long, bus tours are also on tap to ferry drinkers along, along with an annual Portland Craft Beer Festival for those looking for a change from their favorite neighborhood brewpub. Across the state, competition is strong with 134 micro-breweries and 96 brewpubs.
Image credit: Evan Lovely

Illinois

Chicago beer makers can, and do, tap into one of the world’s great freshwater sources: Lake Michigan. Its clean, abundant waters don’t just appeal to locals, either—when California-based Lagunitas selected Chicago as the destination for a new tap room and brew house, the company’s founder and CEO cited the fresh water supply and central location as key deciding factors. Chicago craft brewers have also mastered the art of reflecting the character in their community in their pubs and taprooms. Half Acre, for example, is a popular city brewer with an outdoor beer garden on the North Side, where locals can gather in warmer seasons.
Image credit: Brewbokeh, Half Acre

 California

Golden hops abound in the Golden State, with 408 microbreweries, 209 brewpubs, and 26 regional breweries scattered across the state. Although the craft-beer trend is evident up and down the coast, perhaps the striking example can be found along Miramar Corridor in San Diego. Here, tourists and locals alike appreciate the chance to do a Napa-style wine tour, but with beer, by visiting 14 craft breweries along a 2.5-mile stretch of the road. Even the airport is known for local craft beers, with Stone Brewing in Terminal 2, and Craft Brews on 30th Street in Terminal 1.
Image credit: Jamie Lantzy

Colorado

The Rocky Mountains must have a soft spot for craft beer, considering this one state was home to 8.4 breweries for every 100,000 people over the age of 21 in 2016. Colorado’s “Beer Triangle”, includes Boulder, Fort Collins, and perhaps most notable, Denver. Here the Denver Beer Fest, Denver Microbrew Tour, and Great American Beer Festival all vie for the same beer-loving crowds in the same month. And the rest of the year can be just as hoppy, too, with a little trek along the #DenverBeerTrail, a guide to 27 breweries in the Mile High City.

Minnesota

The Land of 10,000 Lakes is also the homeland of a bustling beer industry, with craft brews generating $1.3 billion revenue last year alone. Growth has been huge here since 2011, when there were a scant 43 craft breweries in the state—last year that number had risen to 112. Growth hasn’t been spontaneous, either. The prominent Minnesota Craft Brewers Guild is a well-known association that brings together leaders from around 10 leading brewers in the state to promote the state’s brewing industry with festivals and other special events.

Ohio

Cincinnati, Ohio is a prime example of just how the craft brewing industry can act as a catalyst for revitalization in old industrial areas. In the city’s diverse Over-the-Rhine neighborhood - a former industrial hub - a surge in brewpubs and microbreweries has helped usher in concert venues, shops and business incubators as well. A thirst for craft beer within the community was key to establishing this hot spot, but to succeed here, brewers need to also find a strong point of differentiation given there are 101 microbreweries and 73 brewpubs in the state. For example MadTree Brewing, which opened in February 2017, caters to the pet set with its 10,000-square-foot dog-friendly beer garden.
Image credit: 5chw4r7z

North Carolina

North Carolina is rapidly emerging as a major beer producer, with 134 microbreweries, 57 brewpubs and 11 regional breweries. Downtown Asheville, known for its bustling arts scene and mountain vistas, has emerged as a top destination for tourists looking to get a taste of the state’s burgeoning craft beer industry. The River Arts District neighborhood is highly walkable for beer drinkers, and Wedge Brewing Company’s expansion into 7,500 square feet at the Foundation in the River Arts District has added a new mix to the offering. For those looking to get out and imbibe further, the Asheville Ale Trail awaits.
Image credit: Authentic Asheville, Wedge

Michigan

Beer-centric communities abound in Michigan, from Ann Arbor and Detroit to Traverse City and Kalamazoo. Home to more craft breweries than any other state in the Midwest, beer and other adult beverages are so popular here that lawmakers are looking for ways to work together by expanding a statewide council for winemakers to include beer, liquor and wine makers. Even the state’s tourism board encourages tourists to consider the rather existential question, what kind of beer are you?

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