As brew lovers celebrated the growing popularity of craft beer during last week’s fifth annual D.C. Beer Week, real estate observers are marveling over the market changes that have seen the return of the first production breweries to the District since the Christian Heurich Brewing Co. shut down its Foggy Bottom brewing operations in 1956.
Back when D.C. Beer Week first started in 2008, there were no production breweries in the District proper. Now there are three, and two more breweries are planning to open. The growing popularity of craft beer in the region dates back to 1992 when Capitol City Brewing Co. became the first “brewpub” to open in the city since Prohibition. Since then, numerous brewpubs have opened throughout the region. The chief distinction between these establishments and breweries is that brewpubs primarily brew beer for sale on site in their restaurant and bar locations, and as such they generally occupy retail/restaurant spaces.
Production breweries, on the other hand, primarily produce beer sold off-site in local bars, restaurants and other outlets. As production facilities, they generally occupy industrial-quality space, with high ceilings and reinforced flooring to accommodate the brewing, bottling and distribution equipment.
These days, the trend appears to be favoring more of a hybrid approach with the newest breweries serving their wares on site as well as having the production capacity for distribution.
DC Brau Brewing Co. became the first production brewery inside the District lines since the Heurichs closed up shop. Originally operating in a modest 6,600-square-foot space at 3178 Bladensburg Rd. NE, the operation has since doubled in size (as of 2012) and currently operates out of 13,150 square feet.
Next to follow suit was Chocolate City Beer, opening at 2801 8th S.t NE in 2011. Working out of a two-story brick industrial building, this operation now serves its brews at more than 40 different local restaurants.
The most recently opened D.C. brewery is 3 Stars Brewing Co., which leased more than 15,000 square feet to open the largest of the D.C. breweries, at 6400 Chillum Pl. NW. This property has 22-foot-high ceilings, which provide ample room for the brewing equipment.
On the horizon, there are at least two more players hoping to quench the thirst of D.C. beer aficionados. Atlas Brew Works has leased close to 14,000 square feet at 2052 West Virginia Ave. NE and plans to open this quarter. The soon-to-open BlueJacket Brewery took a slightly more upscale approach than its predecessors. It converted a historic boilermaker building on the D.C. waterfront into a full production brewery, tasting room and restaurant housed in the 8,159-square-foot glass-enclosed space at 300 Tingey St. SE, near Washington Nationals stadium.
The growing popularity for craft beer and the “buy local” trend appears to favor the possibility of more brewers making moves into the city, creating new demand for this kind of retail/industrial space. If the rapid growth in the D.C. brewery scene over the past five years is any sign, the future is looking pretty hoppy.
Kirstie Boatright is a research manager with CoStar Group in Washington. More information available at www.costar.com.