Photo by Kyle Kastranec
THE GIST
Mikkel Borg Bjergsø is adding another location to his ever-growing, global collection of beer bars and breweries. The Oregonian broke news last week that Mikkeller would be opening a new location in Portland this summer, and would be taking over the space vacated by Burnside Brewing Co., a nine-year-old business that closed unexpectedly in February. At the time, Burnside staff received surprise notice that the company was "no longer operational," according to reporting by New School Beer. This week, the same outlet shared news that Burnside had planned to close anyway, sell its assets, and pay debts to its landlord and others.
That turn of events sounds similar to what New Realm Brewing was able to pull off with Green Flash in Virginia: buy distressed assets at a low cost due to the former owner’s need for cashflow. The purchase includes the brewhouse, kitchen, and leftover packaging supplies like kegs and bottles, according to New School.
The buyout is also perfectly in line with Mikkeller's typical method of operation, as neither Bjergsø nor his company were the actual buyers. Instead, the purchase was made by Kurt Huffman, the owner and managing partner of ChefStable, a company that partners with chefs to "design, build and operate restaurants" in Oregon. According to The Oregonian, he bought Burnside's assets and wiped out the brewery’s debt.
As the paper reports, Mikkeller’s plan is to operate pop-up bar events at the location, complete with at least 23 Mikkeller beers on tap and Japanese food offerings, until the end of 2019. In 2020, Bjergsø and Huffman hope to establish a permanent space. According to The Oregonian, “regulatory issues are significant” and make setting up a long-term brewery and bar on site difficult; no further elaborations were provided beyond mentions of “schedules” and “legal complications.”
WHY IT MATTERS
On paper, this seems like a match made in beer heaven. ChefStable, which has helped to open about 20 bars, restaurants, and event spaces in Portland, is also expanding into nearby cities and suburbs. Mikkeller (which has a brewery in San Diego, partnered with Three Floyds to open a brewpub in Copenhagen and, most recently, lent its name and branding to a brewery within the New York Mets’ Citi Field) has never been shy about opportunities to create new, brick-and-mortar locations.
In the case of the Citi Field brewery, Chris Toia, Mikkeller’s national sales manager, explained last year that the concept and business plan were created by others, then connected with Mikkeller via mutual friends. In this case, ChefStable has played the role of the local expert on the ground: it has experience launching numerous businesses in Portland, and has the insight and acumen to plot a best course of action for the brand within a particularly beer-dense city.
The question that remains is whether the local strength of ChefStable, combined with the international acclaim of Mikkeller, can together create enough influence to break into the beer-heavy market. On his blog, writer and author Jeff Alworth noted that the neighborhood where Mikkeller is setting up shop “has one of the greatest densities of craft beer in the country” with “at least a dozen breweries” in a mile-and-a-half distance, plus other beer-focused bars. That said, Alworth tells GBH that he thinks Mikkeller’s partnership with the successful restaurant and bar developer “is already a big step in the right direction.”
Mikkeller has done well with its expansion through hospitality, and Modern Times’ entry into Portland two years ago has shown that outsiders can find an audience away from their original homebase. As one of the fastest-growing Brewers Association-defined craft breweries, Modern Times has leaned into its brewpub model to expand quickly, even if it’s asking fans for crowdfunding money (its campaign, launched earlier this month, has already raised more than $1 million).
New School writer Ezra Johnson-Greenough doubled down on Alworth’s sentiment, saying that the location “has gotta be one of the hottest areas for yuppies and hipsters to move into,” and wondered how Mikkeller will coexist with businesses like Cascade Brewing Barrel House, Base Camp Brewing Co., Natian Brewery, Modern Times, and more.
In a conversation with GBH, Johnson-Greenough noted that the area on the west side of the city's Buckman and Kerns neighborhoods has fostered something of a mini-culture that may be more accepting of outside companies or higher-cost goods, like beer. Redevelopment has added higher-priced living options to the area, and Johnson-Greenough described it as the kind of neighborhood that could exist in San Francisco.
"A lot of people coming from out of town are willing to check out these newer, hipper kind of breweries," he says, noting the increase of trendy restaurants, bars, and music venues. "Some people are still getting used to a $5 pint, but it hasn't been an issue for a place like Modern Times, which is about $7."
In addition, proposed upgrades to the space around the new Mikkeller-ChefStable operation could make it a popular hangout spot. Should it become a permanent location, Johnson-Greenough says, Huffman hopes to turn a parking lot into a "big, outdoor living room" that would act as a beer garden and host art from a rotating collection of artists.
"Mikkeller is a pretty well-known brand, even by craft beer novices, and their style will definitely attract people," he says.
That's something that Alworth sees as a definite advantage, given that Portland is "a city of a million people, and we’re talking about one pub."
"Nearly everyone here is an immigrant from somewhere else, and at least a few of those people haven’t drunk the Oregon Kool-Aid," Alworth adds. "It wouldn’t take a very big group as a percentage of the population to sustain a Mikkeller."
Its recognizable brand and business insight have undoubtedly proven successful for Mikkeller in locations around the U.S. and the world. Alworth says that, in some cities, Mikkeller would get a “coolness bonus” for being a buzzed-about brewery from Europe. But that doesn’t preclude the need to convince locals to pay attention, whether they’re die-hard Portlanders or newly-arrived residents.
“I do think they’ll be able to [prove themselves], but it will be in leaning toward Portland and assimilating, rather than trying to impress by saying, ‘Hey, look, we have something cooler than you do because we’re from trend-setting Copenhagen and you’ll really be able to learn something from us,’” Alworth says. “That would not be a wise approach.”
Words by Bryan Roth