I closed my brewery - Page 2

Ragoo

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In reply to ATM9000 • 7:49p, 5/26/20

AG

ATM9000 said:
Ragoo said:
ATM9000 said:
62strat said:
Ornlu said:
He mentioned it was March 15th. That's technically before shelter-in-place was ordered but it wasn't before people were voluntarily avoiding public places.

On 3/15, it was pretty easy to see that we were headed for shutdown. If he was "on the fence" already, I'm sure having the enormous specter of a shutdown on the horizon would have made an uncertain decision more certain.

Sure, I can make assumptions but I'd rather hear it in his words.
As Aggie00 pointed out, it says pretty clearly on his post that on March 15th, he couldn't come to a deal with landlord.

That has been the reason for probably 98% of brewery shutdowns in Denver area in recent years; They opened 5 years ago, many of them in areas going through very early stages of gentrification, the real estate market has exploded since then, and landlords want way more rent.

All these brewery owners could only wish they were like little machine (I think that's who it was) in denver, who made the super wise decision to purchase their space.. and now 5 years later, they sell it for multiple times what they paid.

Can't do that now though, market is way too high.

Sure... but what you are describing sounds more like their business was a real estate spec and not operating a brewery.
isnt that what a lot of businesses are? You think McDonald's value is in slinging burgers?

Sort of I guess for somebody... typically not for the burger slinger themself though? All I'm saying is buying land, a building, equipment to brew, etc, is a hell of a lot of obligation to brew some beer and pretty damn risky vs, a few year lease. Hell, you are trapping capital that could theoretically go into business growth when you buy a property vs. lease. Not saying it is always the wrong thing to do... but I wouldn't call it wise and if you are starting from scratch and have zero brand behind your brewery, it is a real estate investment and probably your bigger worry over whether or not your beer sells.

very fair and important points. Agreed. Buying real estate is a logical "growth" step after you have an established brand and revenue stream.

Carnwellag2

Joined: Nov 10, 2012

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5:14p, 5/29/20

Been listening to the podcast - hopefully that gets you a little $$.

A couple thoughts -

1- It seems like you "took a dump"; instead of "got off the pot" early on. You jumped in quick without knowing or having a clear vision. The negotiations with the landlord should have been done through an intermediary - they would have gotten your place move in ready. The landlord would have been required to take care of the sprinkler system. Its hard to fault the landlord in this situation. He wasn't a partner.

2- From episode 2-5; I kept thinking - what they really wanted was just a place to brew beer and drink with friends. Perhaps they should have just rented a house with 3-4 other couples and just had a good time!

The episode I am currently listening to - prompted me to reply to this thread. I am listening to episode 6- The Landlord episode.

Perhaps it is my old age, but this episode highlights something that is very wrong with the mentality of the younger generation. You had entered into an agreement with the landlord. Then you wanted to change the deal because it wasn't working for you anymore. The episode was devoted to trying to vilify the Landlord.

I get that he has a little bit of a desire for your business to succeed, but not to his detriment.

The whole trying to buy the property for less than market value (or the market value 2 years ago) is mind blowing (in that you got so mad when he said no). The rent that was paid and the improvements done were part of the rental agreement and doesn't have a bearing on a purchase price.

Think about renting a house for 4 years of college. Then at graduation offering the landlord to pay what the home was valued at 4 years ago and taking into account the 4 years of rent payments. a landlord/ property owner who thought they could get a better price would be foolish to say yes.

You mention being scared that he might show up and lock you out for failure to pay rent. The fact he didn't shows a little bit that he might not be the boogeyman portrayed.

I am sorry I never made it to your place or tried your beer.

5

YouBet

Joined: Jan 9, 2001

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6:31p, 5/30/20

AG

I thought the Texas laws had loosened up some in favor of smaller players like this? I recall a bunch of hoopla around this about 5 years ago. Guess not though?