The end of May wasn't pleasant for Colorado craft beer lovers. Three different breweries in three different Front Range cities closed or announced that they would close soon. But the reality is that two of those breweries shut their doors for reasons that had more to do with their own specific issues than they did with brewery competition in general — and that brewery closures are still exceedingly rare in this state.
Until last week, only six breweries had closed statewide in 2019: Ute Pass Brewing in Woodland Park, Lost Highway Brewing in Centennial, Fermaentra in Denver, UTurn BBQ in Lafayette, The Brew Pub & Kitchen in Durango, and 1876 Ale Works in Colorado Springs (which closed two weeks after it opened).
But then Fate Brewing in Boulder and 38 State Brewing in Littleton both announced that they would host their final days at the end of May. And that was followed by the dramatic-sounding seizure of Ironworks Brewery & Pub in Lakewood, which was shuttered and bolted by the city of Lakewood after the employees were ushered out.
Fate closed because of very specific problems. Its attempted expansion into the old Avery buildings in 2015 ending up saddling the company with debt. Another expansion, this one into Lafayette, didn't go well — and Fate filed for bankruptcy late last year. Ironworks also had a unique set of issues. The brewpub, which had been in business since 1989, was known more for its ambience than its beer; Lakewood seized the business on Friday because it owed more than $15,000 in taxes.
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In the meantime, however, fifteen new breweries have opened statewide in 2019 — and there are another fifty under construction, according to Stephen Adams, who carefully tracks Colorado brewery openings and closings as the Colorado Beer Geek on Facebook and for the website ColoradoBreweryList.com. In 2018, there were 67 openings and twenty closures, Adams says. The primary reason for these closures has been rising rents, although several breweries were simply sold to new owners. In 2017, there were thirty openings and fifteen closings, while in 2016, there were 42 openings and seven closings.
Nationwide, 1,049 breweries opened in 2018, while 219 closed. In 2017, those numbers were 997 and 165, according to the Brewers Association. All told, there were 7,450 breweries operating at the end of 2018 — and there are already more than 8,000 now. In Colorado, there are currently right around 400 operating breweries, depending on how you count them.
So, no, the "bubble," as some people call the explosion of craft breweries over the past five to ten years, has not burst — at least not yet. That trend could certainly change at any time, however, as rents continue to rise. Five-year leases are expiring for many of the new wave of breweries that signed or opened in 2013 and 2014. In fact, Colorado saw its highest number of brewery openings in 2014, Adams points out, with a whopping 68. So there is a good chance that more breweries will close as those leases expire and rents go up.
But for now, talk of a bursting bubble is still premature.