The Ghost in the Mash Tun
Smokestacks are a telltale sign.
The old breweries are disappearing. This is hardly a recent phenomenon—old breweries have been disappearing for centuries. I have attuned my antennae to perceive their bones, which occasionally still poke up like a dragon’s wing over the tops of buildings. The malt industrialists built their factories well, and the brick walls survive their original purpose, inevitably transformed into housing or shopping centers. But what happened to the companies that quit these palaces for more prosaic factories?
The town of Bury St. Edmunds will soon be the proud owner of a grand, Regency-era tower brewery, until this year one of the oldest functioning breweries in Britain. Last week, Greene King announced plans to decamp to a squat, graceless building nearby, leaving its 225-year-old house to modern purposes.
The community of 45,000 is one of those postcard destinations Americans think of as characteristically English—and the brewery could serve in the same capacity. It is pure British, a cathedral to brewing no less than St. Edmundsbury is a cathedral to the Church of England. In the mid-aughts, the brewery’s owners even refurbished the old site, replacing worn out coppers with fresh ones, an effort to preserve not just the look of the old place, but its soul. Things change, however, and the imperatives of the ledger trump those of the heart. The company sells vastly more beer outside Suffolk than it does inside, and efficiencies will put liquid into steel at a more competitive price. Almost no one noticed when Hong Kong-based CK Asset Holdings bought Greene King five years ago; will they care where the beer is made?
On paper, these arrangements always seems to pencil out. Better equipment, more compact footprint, easier access—all of that comes at 40 million pounds, but in the long run it should pay off. The maths confirm it.
And yet.
Beer isn’t just another consumer product. Does anyone care where their Coca Cola was made? Their Ben and Jerry’s, Nikes, or iPhones? I often mention that regular consumers know far less than industry insiders think they do. If they know more than a few styles or can accurately explain the difference between ale and lager, they’re in the 80th percentile. That’s true. Assuming that beer is nothing more than bare liquid, however, is a different kind of mistake.
Even if they don’t understand why, people have a vague sense that it matters where and how beer is made. Examples are legion, but I’ll use one close to home. In 1999, Portland’s Blitz-Weinhard brewery was making hundreds of thousands of barrels of Blitz and Henry’s beer. Parent company Miller ran the numbers and decided it would make a lot more financial sense to move production to their Olympia plant 100 miles north of Portland. It may well have penciled out for Miller, who was able to sell valuable downtown real estate. But it mortally wounded the Henry’s/Blitz brands almost immediately. In terms of the beer, location mattered. No one needed another random brand of domestic lager—and sales of Oly-brewed Henry’s collapsed.
In the photo array below, compare/contrast Greene King now and in the future:
Illustration: Greene King
I’ve lately been thinking about all of this in relation to Anchor. Once Sapporo decided to shut it down, different groups began to scramble to save the brand. The lovely old brewery in downtown San Francisco will almost certainly not be any part of future plans—the ground on which it sits is just too valuable ($40 million by recent estimates). Some groups have organized to save Anchor Steam the beer, without thinking too much about how important that brewhouse is.
When you crack a bottle of Anchor Steam, though, are you hoping to drink in merely a slightly sweet, copper-colored beer? Or is that liquid imbued with something more? Doesn’t it somehow express the flavor of old San Francisco, the glitter of gold rushes and the tang of wharf air?
Let’s try a thought experiment. If the simple little beer were recreated absolutely perfectly, molecule by molecule, but brewed in a strip mall in Hayward—or worse, Los Angeles—would it still taste the same? Because let’s be clear, steam beer is pretty far from the center of the American palate right now. People drank Anchor for a lot of reasons—perhaps one for every decade it lived in San Francisco—but the flavor, stripped of those old roots in Potrero Hill, may not have been the central one. It’s hard to imagine Anchor Steam ever returning to its status as a nationally-distributed product without the heritage residing in those walls. Without that, it’s just another slightly odd, beta version of American craft beer.
Greene King? It has the advantage of owning a bunch of brands that have already been stripped of their old breweries, and further by having exhausted most of the affection and nostalgia the core brand once enjoyed. But I wouldn’t discount entirely the importance of that imposing, physical space in the heart of Bury St. Edmunds. They maintain a couple old oaken vats where they ripen wild, aged Strong Suffolk, they own a fleet of pubs that form invisible lines back to Suffolk, and most importantly, Green King has been a visible daily presence in the lives of generations of people there. What part of Greene King’s success derives from that old building? If the number is more than marginal, doesn’t this move represent a pretty big risk?
That soul, or whatever you want to call that basket of emotional connections a brewery represents, is a valuable piece of the actual value of a beer company. It never appears in the balance sheet, but an old brewery has a lot more worth than the copper, steel, and bricks that are dutifully totted up. Souls matter, or should, even to financial officers. Let’s check back in five years to see just how much.
Follow-up
I’m seeing a couple of different kinds of responses to this post on social media. One type points out that Greene King’s beer is often in poor condition, and new equipment will really help that. The second is in this vein:
“Nope. Everything will work better, workers will be happier, and Greene King and its shareholders will be a lot better off as the old brewhouse will be sold off for developments into flats.”
I do not want to minimize the hard choices old breweries are left with. Greene King once tried to freeze everything in amber, and that meant a final product that aged badly once it got out to the pubs. Adnams made a different choice, completely remodeling their brewhouse with a state-of-the-art, push-button system—but in their historic building. (They felt much of the character came from the two-strain yeast and square fermenters, which they didn’t touch.)
Again, my point is that I don’t think people are pricing in the value of a historic site. I always try to keep an open mind, so holler if you have examples of this working out in the long run.