Modern Times to Take Over Commons Brewery Location as Portland Brewery Founder Contemplates Future

San Diego’s Modern Times Beer Company is heading north to Beervana.

The southern California craft brewery today announced plans to takeover what will soon be the former Commons Brewery location in the Buckman neighborhood of Portland, Oregon.

In a statement, Modern Times CEO and founder Jacob McKean said the company had signed a lease agreement with Mike Wright, founder of The Commons Brewery, who also owns the 10,000 sq. ft. site where his beer company is currently located.

“We’re incredibly excited to be coming to Portland, and we’re so looking forward to becoming a pillar of the local brewing community in a city we love so dearly,” McKean wrote, noting that he’d already been eyeing Portland as a possible expansion market.

“It filled a real need for Modern Times — we’re capacity constrained, in part due to our success in the Pacific Northwest — while helping out a friend of the brewery who had shown us support and solidarity along the way,” McKean added.

That friend — Wright — said he would cease operations and vacate the premises at 630 Southeast Belmont Street at the end of the year. He will then turn the space over to Modern Times, which will install new brewery equipment and rebrand the location as “The Belmont Fermentorium.”

It should be noted, however, that Modern Times is not acquiring The Commons Brewery, nor is the Portland-based producer of farmhouse and wild ales shutting its doors completely. However the future of The Commons Brewery, which Wright launched in 2010 out of his garage, is uncertain.

“I’m not ready to write the last chapter in this book yet, but this is definitely a defining moment for The Commons,” Wright wrote.

According to Wright, two years of “lagging sales and battling cash flow,” forced him to “make some very uncomfortable decisions.”

“This boiled down to simple debits and credits,” he explained. “That’s the sinister simplicity of a cash flow problem. Your debt is clearly defined, but revenue is a rollercoaster.”

Wright said he always believed the company would “break out,” and overcome those challenges.

“We did not,” he wrote.

Beginning January 1, 2018, Modern Times will close the current Commons Brewery location for about a month as it works to install new brewing equipment and add “distinctive art installations” to the tasting room, McKean said. With 7,000 barrels of initial capacity, Modern Times plans to use the location for the production of draft offerings that will be distributed throughout the Pacific Northwest. Recall that Modern Times began distributing its beer to Portland in February through General Distributors Inc.

“Obviously, this will mean even fresher, better, locally brewed draft beer for all of our fans in Oregon, Washington, and Idaho,” McKean wrote. “The tasting room will serve the greatest hits brewed on-site, in San Diego, and at our forthcoming R&D brewery in Los Angeles, which will open before the end of the year.”

In addition to the two locations it already operates, Modern Times is currently in the process of opening three other satellite facilities in Southern California. Once Portland and its other outposts are up and running, the company will have six brewery and tasting room sites.

Modern Times has also signed a 10-year lease on a neighboring 10,000 sq. ft. building at 600 Southeast Belmont, in Portland, that will be transformed into a packaging hall and tank farm. Construction of the packaging hall will take about a year to complete, McKean said. When finished, the company’s capacity in Beervana will top out at about 20,000 barrels annually.

Modern Times is financing its Portland expansion efforts with a combination of cash and bank debt from the company’s existing lender, McKean said.

The company has appointed cellar manager Matt Sandoval to run the brewing operations in Portland. The plan for The Belmont Fermentorium is to add a coffee roaster, cafe and food service after its packaging operation opens. It will also serve as a pick-up location for members of Modern Times’ club, The League of Partygoers & Elegant People.

Modern Times currently operates a 30-barrel production brewery and taproom in San Diego’s Point Loma neighborhood as well as tasting room in the North Park neighborhood. Two new tasting rooms in Anaheim and downtown Los Angeles are slated to open this year. Meanwhile, Modern Times is continuing to push forward with plans to open a taproom in Encinitas. McKean told Brewbound that the company still has “a few more regulatory hurdles to get over before we can discuss the timelines with any confidence.”

Earlier this year, Modern Times announced the implementation of an employee stock ownership plan (ESOP) that gave the company’s workers a 30 percent minority stake in the company.

Statements from both companies are included below.

More Ginormous News from Modern Times Brewing

First, a little background. I’ve loved the city of Portland for a long, long time. I’ve been visiting regularly for well over a decade, and I gave serious consideration to starting Modern Times in PDX. I ultimately decided to stay in San Diego, where my roots in the brewing scene were deepest, but I never gave up on the dream of building something in Portland. I love so much of what Portland stands for: the kickass food and drink scene—of course—but also the bike culture, the appreciation of good design, the ubiquity of Secret Aardvark, the progressiveness, and much, much more.

Once it became clear that Modern Times was going to be a success, I began giving some thought to how we would grow. And what I decided then—which I’ve been telling people openly for years—is that I’m not interested in building a giant new brewery in some dreary suburban industrial park here in San Diego. It’s not my jam for a whole host of reasons. So what I decided we would do instead is build another location like the Lomaland Fermentorium somewhere else: a place that functions as both a production brewery and a neighborhood hangout. And that “somewhere else” for me was always going to be Portland.

I knew that was going to be the plan well before I was able to act on it. It’s been something of an open secret within Modern Times from the beginning, in fact. Even before we started distributing in Portland, we scheduled collaboration brews there, both to deepen our relationships with brewers we admire and to give ourselves a business excuse to visit a city we love.

Since we’ve started distributing in the PNW, we’ve been blown away by the acceptance and warm welcome we’ve received from beer drinkers and brewers alike. I was given no shortage of warnings about how difficult it would be for an out of town brewery to succeed in Portland, but I always felt like we had a chance to be the exception to the rule. And thus far, that has indeed been the case, which is incredibly heartening and has reaffirmed my feeling that the second Modern Times production location should be there.

So, with an eye towards finding a space that could be leased and built-out in time for a 2019 opening, we started working with a real estate broker. He began sending us raw spaces, which would have required over a year to build-out, which is what we expected going into this.

But after we’d begun the search, I got an email from Mike Wright, who owns The Commons and the 10,000 sq ft building on Belmont that the brewery occupies. We’ve collaborated twice with The Commons and developed a close bond with them. Hell, even before the collabs, when Modern Times was just a tiny start-up, I got an incredibly gracious email from Mike saying that he’d had a chance to try a can of Lomaland and that he was extremely impressed. As an insanely stressed-out new business owner who looked up to The Commons in a big way, that email meant a great deal to me.

When Mike contacted me earlier this year, he let me know that the current space wasn’t working well for their operation and asked if I was interested in leasing the space. It pretty quickly became clear to me that this was something we should do. It filled a real need for Modern Times—we’re capacity constrained, in part due to our success in the Pacific Northwest—while helping out a friend of the brewery who had shown us support and solidarity along the way. Just recently, we officially signed a lease on the space.

I need to pause here to make very clear what is not happening: we are not acquiring The Commons. The Commons is vacating their space, and Modern Times is leasing the space from Mike, the building’s owner. I realize this key point will probably get butchered in the telling and retelling of this news, but at least I did my best to make it clear.

So, what does this mean for Modern Times? It means that on January 1st, 2018, we will be the new tenants of 630 SE Belmont St, which we’ve dubbed The Belmont Fermentorium. We plan to close for about a month, while we bring in new equipment and add some of our distinctive art installations to the tasting room. After we re-open—with a suitable celebration—The Belmont Fermentorium will begin producing all of the Modern Times draft beer for distribution in the Pacific Northwest. First year capacity should be around 7,000bbls.

Obviously, this will mean even fresher, better, locally-brewed draft beer for all of our fans in Oregon, Washington, and Idaho. The tasting room will serve the greatest hits brewed on-site, in San Diego, and at our forthcoming R&D brewery in Los Angeles (which will open before the end of the year.) The Belmont Fermentorium will also function as a pick-up location for The League of Partygoers & Elegant People.

Additionally, we’ve signed a lease on the neighboring building (600 SE Belmont), which is a 10,000 sq ft raw shell (the same size as 630 SE Belmont.) This space will take at least a year to renovate, but once it’s complete, it will house a packaging hall and tank farm, which will allow us to brew and package all canned beer for PNW distribution. Final capacity for combined spaces should be around 20,000bbls. Once 600 SE Belmont opens, we also plan to add a coffee roaster and café, along with a full food set-up. It should be pretty radical.

Alrighty, that’s it for now. We’re incredibly excited to be coming to Portland, and we’re so looking forward to becoming a pillar of the local brewing community in a city we love so dearly.

Statement from Mike Wright, Founder of The Commons Brewery

The tiny project (Beetje) born out of my garage 2010 that morphed into The Commons Brewery in 2011 has been an exciting journey far exceeding my expectations. I’m proud of our ability to make interesting and well executed beer, and feel very lucky to have played a small part in developing a group of idealistic, passionate and sincere people into widely respected members of the brewing community. I’m not ready to write the last chapter in this book yet, but this is definitely a defining moment for The Commons.

After 2 years of lagging sales and battling cash flow, I have had to make some very uncomfortable decisions. At the end of this year we will shut down operations on SE Belmont and vacate the building. I have leased the building to Modern Times who will operate out of the space. The Commons has not been sold.

What Happened?

Unfortunately, this is a classic small business cash flow story. Sure, there is plenty of industry nuance and hindsight that can be evaluated, but this boiled down to simple debits and credits. That’s the sinister simplicity of a cash flow problem. Your debt is clearly defined, but revenue is a rollercoaster. The belief was that we’d eventually break out and get past those challenges. We did not.

What’s Next?

I am motivated to find a pathway forward for The Commons, but that’s not yet clear and I don’t want to make any claims that I cannot follow through on.

In the near term we are still making delicious beer, and pouring it from the 12 taps in our tasting room. Galaxy Myrtle, fresh hop Myrtle and Raspberry Lime Ricky are in the tank. One­off saisons like Country Drive (Allegory Collab), Saison Quest (Level Collab) are pouring now. Flemish Kiss will be available in bottles by mid September. Staples like Urban Farmhouse and Pils are tasting amazing.

We want you all to know we appreciate the support over the years ­ the friendships we’ve made along the way are sincere and will carry forward. We’d love to see you in the tasting room to talk about beer, or the Blazers/Timbers, or the sweet hike you just got back from. I hope to offer another chapter sometime in the future.

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