Was sounding kinda reasonable until I got to the “lease for $25k a month” and that’s where the red flag really came in for me, but I’m no entrepreneur or financier at all. Angry Chair makes great beers, they need to continue on somehow or losing Cycle and Angry Chair is pretty devastating to Tampa area beer scene and even to the US craft beer overall IMO.
16K sq ft for $25K doesn't sound bad for a commercial site. If you divide by 10 for a residence, imagine a 1600 sq ft house renting for $2500. Doesn't sound bad. It's just one part of overhead that makes profitable brewing difficult to maintain.
Rent: $25,000/mo is $18.75/sf/yr. Commercial rents in that neighborhood run about $20-$36/sf/yr. So, it’s a relative bargain.
The problem as always for breweries is they’re paying that same rate on a lot of production space that can’t generate revenue. If you do that math with just their taproom space it’s probably pretty onerous.
True but I assumed they rented an amount of space they needed to produce X amount of revenue according to their business plan. Production space and taproom space are both revenue generating. Huge taproom with lots of empty space, indoor corn hole and giant Jenga, playground for kiddies, etc. less or no revenue. If a business rents a few hundred thousand square feet but only a hundred of it produces revenue, maybe they shouldn’t be in business. Having said that, I’m familiar with a brewery that went under. Large production area, small taproom. Their model intended to be primarily distribution but they never got their footing with competition for retail shelf space. The taproom did ok but they had a cavernous brewery not generating revenue. So, the answer is, it depends. I have the utmost respect for breweries and small business in general but don’t envy the uncertainties they have to live with.
