The operators of Newport Storm Brewery, which officially opened in mid-June, believe they are in the right place at the right time.
It is in the right place because the beer brewery and rum distillery is in the City by the Sea, a location the founders of the business waited years to find and acquire, and it is the right time because, according to operators and beer-industry experts, small craft breweries in the United States are selling more beer than ever, while the sale of traditional brews is falling nationwide.
Brent Ryan, president of Coastal Extreme Brewing Company LLC, parent company of the brewery, said his company is targeting as its clientele those people who enjoy the many innovative types of craft beer. “People into craft beer like to try different kinds,” Ryan said, “and we are catering to them and providing a variety of beers.”
The Newport Storm Brewery produces approximately 4,000 barrels of beer each year but is capable of making 6,000 when, Ryan noted, the time comes to expand. It is, in fact, a tiny brewery when compared to the millions of barrels produced each year by large national brands such as Anheuser-Busch.
The Brewers Association, a trade group based in Boulder, Colo., that represents small and independent breweries, defines craft beer as brew manufactured by small breweries, usually with an unusual twist or style that has few precedents. “The hallmark of craft brewers and craft beers is innovation,” the association said on its website.
Newport Storm regularly produces two brands of beer year-round: Newport Storm Hurricane Amber Ale, its signature blend and “most popular” beer, Ryan said, and Rhode Island Blueberry, made with blueberries from Schartner Farms in Exeter.
But, in addition, “every year we make about 10 different kinds of beers,” Ryan explained, including those that vary with the season such as Blizzard Porter in winter or Regenschauer Oktoberest in fall, and those offered in limited release, such as the Cyclone Series with just 1,300 cases made of each kind. The latest in the Cyclone Series is Quinn, a Porter-style, dark beer aged in rum barrels, which Ryan said is on the market now and will be available for only about another month.
According to the association, the sale of craft beer in 2010 rose 11 percent by volume and 12 percent by dollars, compared to 2009, when growth rates were 7.2 percent and 10.3 percent, respectively. That means craft brewers sold an estimated 9.9 million barrels of beer last year, up from 8.9 million in 2009. (A barrel is defined as 31 U.S. gallons.)
Overall, the brewers’ trade group reports, beer sales have dropped in the last two years; in 2010 in the U.S., sales dropped 1 percent from the year before and, in 2009, overall sales were down 2 percent from the previous year.
In 2010, 1,753 American breweries were in operation, the highest amount since the 1800s, the association said, and pegged the American beer market as producing approximately $101 billion from the sale of 203.6 million barrels of beer.
Regarding the Newport brewery, Ryan explained that he and his current business partner, Derek Luke, along with fellow Colby College graduates Mark Sinclair and Will Rafferty, started the company in 1999. They worked out of garage bays in a Middletown industrial complex and expanded every year until there were no more garage bays available to them. Both beer and rum were produced.
With a private bank loan and capital from 13 investors, partners in 2007 began searching in earnest for a permanent home where they could construct a brewery manufacturing center.
Describing the outcome as a perfect example of private/public cooperation, Ryan said Newport acquired from the state about 1.5 acres of vacant land, which Newport Storm agreed to lease for 100 years. “Very little land in Newport is zoned for manufacturing and a facility like ours takes up a lot of space,” Ryan said. “Without this collaboration we would have had to look elsewhere to expand.”
The 8,000-square-foot brewery, built along J.T. Connell Highway in the north end of Newport, more than doubled the amount of space available for production, Ryan said. The $1 million undertaking also saw the purchase of new equipment for 90 percent of the production process and construction of a visitors’ center to host guests interested in touring the facility.
Ryan said he expects as many as 10,000 people to tour the site each year. “We have a great venue to receive them,” he said, referring to an interior deck in the visitors’ center that overlooks the manufacturing floor so tourists can see, smell and hear all that goes on as the beer is brewed.
Regarding the traditional belief that good beer depends on a tasty water source, Ryan said that today’s technology makes such an approach outdated because the “hardness” or “softness” of the water can be controlled through the use of filters and minerals. Generally, hard water has more mineral content, Ryan explained, and “beer companies have found that people prefer mineral content in their water” because it enhances the taste.
Well aware that Newport and Rhode Island were prime centers for the production of rum during Colonial times, Ryan said his firm decided to make rum for that very reason.
“We received the first rum distillery license in Rhode Island in 135 years,” he said proudly, noting that the city housed as many as 22 rum distilleries in 1769. He estimated that between 10 and 15 percent of Newport Storm’s production is rum, with between 85 and 90 percent beer. The rum, made with “blackstrap molasses,” Ryan said, is double-distilled and aged in barrels for several years before it is sold.
Meanwhile, plans to establish another brewery in Rhode Island remain in the works. Mark Hellendrung, CEO of Narragansett Beer now based in Providence, told Providence Business News his search for a site to set up a brewery in Rhode Island continues. “We’re working on it,” he said. “We’ll start site selection in the fall. We’ve talked to a bunch of people and looked all over, but it would not be fair to single out any one location at this time.”
Unlike the beer-business nationally, Hellendrung said his company’s sales are up 25 percent in Rhode Island this year compared to last year and total sales are up 40 percent in the same time frame. He has previously said the company is eyeing potential brewery sites in Providence, Pawtucket, Cranston and other places. •
