San Diego Beer Week, one of Small & Schena LLP’s favorite weeks of the year, wrapped up this past weekend.  Craft beer is big business in San Diego County; and it’s good business both in terms of the numbers and quality.  Depending upon who tallies the numbers, you’ll find that the local beer industry contributes anywhere from 2,000 to 4,000 jobs spread amongst the 80 plus breweries headquartered in San Diego County.  It’s great when something that brings so much joy also produces solid jobs.  Cheers to that.

While toasting to many of our favorites last week (let’s be honest, we don’t need Beer Week to do that), we took a little time to gather and appreciate some news that will have ripples between now and the next San Diego Beer Week.

Mergers, Acquisitions, and Bubbles

San Diego staple Green Flash had perhaps the biggest bang of the week in terms of making news, when it announced that it will acquire local favorite Alpine Beer Company.  This news came just a few weeks after Green Flash broke ground on a facility that will begin bi-coastal brewing in Virginia Beach, Virginia.  (Green Flash will likely join Stone Brewing Company in the Commonwealth, as Stone has announced plans to build a brewery and restaurant in Richmond, Virginia.)

Alpine was founded in 1999 and Green Flash followed a few years later with a much larger brewing capacity.  Over the course of the past year, the two have been collaborating to increase Alpine’s volume and that relationship will continue but it is unknown at this time whether that means Alpine will be brewed in Virginia as well.  Regardless, we hope this means more Alpine for the masses.

Was the Green Flash-Alpine acquisition any indication of the state of the craft-beer bubble?  (Anheuser Busch also made M&A news when it acquired Oregon-based 10 Barrel Brewing Co. earlier this month.)  Maybe, but it’s hard to say now, especially as others are jumping full force into the craft beer business.  We look forward to see how our friends at The Local progress with their ambitious downtown plans to begin brewing beer.  We are equally excited about the plans of  Monkey Paw’s Scott Blair to open South Park Brewing.

Most New Laws Relaxing Prior Restrictions

For the most part, it has been a good few months legally-speaking for brewers.

  • A few weeks ago, Governor Jerry Brown signed Assembly Bill 2004 into law.  A.B. 2004 permits breweries to sell pre-packaged beer at farmers’ markets subject to permit.  More opportunities for sales means more potential for revenue – sounds good from where we sit.
  • The legislature agreed that peanuts, pretzels, and chips go well with beer.  As such, Senate Bill 1235 relaxes the California Retail Food Code for tasting rooms offering prepackaged foods for sales.
  • It’s no surprise that nonprofits like beer, too.  AB 2609 permits nonprofits to serve homebrewed beverages at fundraising events.  

But, not all of the new laws are relaxing prior restrictions.  A.B. 2010 sets a new limit on the amount of “branch offices” (think tasting rooms) that operate under the same license as the brewing facility at six.  It will be interesting to see if this law has a real effect on the pop up success of tasting rooms.