Tree House Brewing Company, which has built its reputation on the modern trend of hazy, juicy IPAs, is going back to nature. In an announcement this week, the Massachusetts-based company said it would begin work on opening Tree House Orchard & Farm Fermentory in Woodstock, CT, about 17 miles south of its Charlton, MA home.
In a blog post describing the project, co-owner Nathan Lanier said Tree House now owns a 100-acre farm, 60% of which is "agriculturally prime soil." Along with a grazing pasture for cattle, the business will also have a flower and produce program, the latter of which will have a focus on heirloom apples and other fruit. In fact, Lanier lists apples, peaches, pears, plums, cherries, blueberries, raspberries, blackberries, gooseberries, jostaberries, and black currants as the lineup of fruit that could be a part of its own Community Supported Agriculture (CSA) program and fermented products. There will also be a farm stand for direct sales of what's grown on the property.
According to HardfordBusiness.com, the company paid $1.6 million for the land, which will include a barrel room for "fermentation, conditioning and fruiting of various beverages," as well as a cider program that will begin this fall.
“We are obsessed with creating irreplicable taste experiences of significance and authenticity, with a genuine connection to our long and storied agrarian lineage,” Lanier wrote on the company blog. “Tree House Orchard & Farm Fermentory will allow us to do so with more vigor, focus, and inspiration than ever before. We can feel this in our bones. We are so, so excited to share it with you.”
WHY IT MATTERS
Compared to Tree House’s previous expansion effort, this one seems quaint.
In 2016, MassDevelopment, a state-supported economic development agency, issued a $7.7 million bond to help finance an estimated $18.5 million project to help the company open a new brewery with a capacity of 150,000 barrels per year. At the time, Lanier iterated to GBH that there was great consideration toward financing such a project.
“The best advice I can give anyone considering borrowing money is to think about what happens if it all goes wrong,” he said at the time. “Keep your financials tight. Think about the worst-case scenario. Demonstrate that you have really thought things through.”
According to the Boston Globe, Tree House produced about 48,400 BBLs in 2018, a jump of 133% from 2017 estimates. It was just four years ago that the brewery's 2015 production was 2,350 BBLs. What’s most impressive is that of that output, nearly everything is sold at Tree House locations, so the margins are nothing short of advantageous. With rough back-of-the-napkin math, using that 2018 output and an estimated average price of $4 per can sold by Tree House, last year would have brought in $48 million in revenue if every drop was sold own-premise.
That’s not likely the case, and these are figures based off of reporting from the Boston Globe and Tree House’s own figures, but they give an idea of the financial power this juicy IPA juggernaut has become in a short period of time. Estimates may vary, but it seems that revenue would be in the tens of millions at least.
So, if money isn’t an object, this new project for a paltry $1.6 million is nothing short of a passion. In his blog post announcement, Lanier wrote that the farm will be “a means to continue to pursue our interests, broaden our horizons, and create something of taste, elegance, intrigue, and refinement, to be enjoyed and celebrated; contemplated and proudly imbibed.”
That kind of thinking is not uncommon in today’s industry. As success has afforded many companies new opportunities, brewers have used their new financial flexibility to do the same with their creative muscles. Some branch out to test new styles and processes, others explore different fermentation techniques. Lately, deeper connections to land and agriculture have become the norm. Jester King has made it a core value of their business and more recently in Nashville, Yazoo Brewing Company has been testing in-state offerings to create its first beer from 100% Tennessee ingredients.
Now that craft beer has found its way into a more mainstream position—even if it only occupies about 13% of national volume—new phases of boundary pushing personally and professionally are encouraging companies to branch out. Even the Brewers Association is supporting such moves, altering its own definition of “craft brewer” to allow for members to produce any variety of non-beer beverages. For some, like Boston Beer, it’s a necessary step as flavored malt beverages like hard tea and seltzer prove to be an important part of their portfolio. For smaller businesses, like Tree House, those changes simply fit into a company ethos of what was planned all along. The exploration of fermentation isn’t defined by a trade organization, and now those changes reflect how new business plans and opportunities are sought by a variety of industry pros.
It also gets back to brewing's roots from Europe, where a focus on local and regional ingredients has long been the norm for food and beverage. Allagash has made this kind of commitment to buying one million pounds of Maine-grown grains per year by 2021. Peers like Firestone Walker Brewing Company, Tröegs Brewing Company, and more have also sought ways to connect to their nearby land. In 2019, North Carolina’s Fullsteam Brewery will hit $500,000 in cumulative spending in purchases from local farms since the business opened nine years ago, and is considering all-local grain for at least one core brand.
As things get more crowded and breweries adhere to the “inch wide, mile deep” philosophy of catering to home markets, maybe this was all bound to happen. Tree House is just the latest, prominent example of a company focusing on its roots—philosophical or otherwise—to grow something new.