Pop culture is full of inspiring stories of entrepreneurs at rock bottom and ready to pull the plug on a project, who didn’t and succeeded despite the odds.
It can’t become a plucky twist in your origin story if you and your dreams don’t make it to the other side, though.
When WeldWerks Brewing Co. settled on a site for its first expansion outside Greeley in 2019, the world made more sense. The award-winning operation — well known for its popular and nationally available Juicy Bits IPA —thought it had a clear view of the future from a tiny 110-year-old house and former restaurant on Colorado Springs’ west side.
A 2019 artist’s rendering shows the planned Colorado Springs location of WeldWerks Brewing Co. The reenvisioned former diner near 31st Street and Colorado Avenue included a dog-friendly outdoor beer garden and a two-story addition topped with a “treehouse-inspired” patio.
“What we really wanted to do was create something that was unique for Colorado Springs but still had the same ethos and vibe and aesthetic which we have in Greeley,” said WeldWerks’ head brewer Neil Fisher, who co-founded the brewery in 2015. “We had a pretty sharp design, I think it was just too ambitious. And by the time we discovered that, it was a little too late … and then we still kept going because we’d already invested so much. We really thought we could do it. Right up to the last minute.”
The company announced last week that after almost three years of progress in expensive fits and starts it was abandoning the unfinished project at 31st Street and Pikes Peak Avenue and putting the property on the market. The company had moved the building, built a new foundation and was in the process of expanding the structure.
“We were up to probably 10 times what that original budget was back in 2019, and we still weren’t finished,” Fisher said.
He wants to make it clear that the pandemic wasn’t to blame, at least not directly.
Call it “pandemic times,” then.
In the last two years — and especially, the last few months — craft brewing has faced a wake-up call loud enough to break a reverie that’s been building since the 90s, when craft’s meteoric rise as an industry began to dot the land with new brands.
“While the abatement of the pandemic and return of on-premise drinking and dining has improved sales conditions for small brewers, turbulence and uncertainties in the supply chain and pricing are indeed threatening this fragile recovery for many brewers,” said Bart Watson, chief economist at the Brewers Association, based in Boulder. “We’re already seeing some brewery closures that owners partially attribute to these challenges. Running a small business is always a challenging endeavor and any conditions that create more uncertainty are going to have an effect on industry trends.”
Data from the U.S. Census Bureau shows that construction costs were on average more than 23% higher in 2021 than in 2019.
A recently wrapped kitchen remodel at WeldWerks’ Greeley headquarters bore those numbers out, coming in “well over budget.” An expansion of the production facility is underway, and expected to do the same, Fisher said. So WeldWerks will still be found on shelves and taps here and around the country … just not at its branded taproom up the street in the Springs.
Filling shelves costs more because aluminum cans and glass bottles remain in record high demand and record short supply.
Ditto for the ingredients brewers need to make the liquid that goes inside. Barley, hops, fruit, “you name it,” said Fisher.
“I think we’ve all been able to weather some of the increases in cans and other costs, but we’ve also had really bad harvests,” he said. “There’s not a whole lot of certainty on what the future of craft beer’s growth looks like. With Ukraine right now, it’s feeling like we’re … going from one kind of global crisis to the next. I think that’s kind of got all of us really evaluating what’s next and making sure we’re prepared.”
That doesn’t mean breweries aren’t still opening, in the Springs, Denver and all around Colorado. They’re just taking a little longer, and paying more, to do it.
In December 2019, four miles north of the where WeldWerks was getting rolling on its ill-fated Springs venture, Red Leg Brewing Co. broke ground on a similarly-ambitious project with an entirely different scope, on 2.5 acres near open space off Garden of the Gods Road.
Red Leg celebrated the grand opening a year and a half later, in July 2021.
As the new complex approaches its first birthday, in a spot with a 4,000-square-foot Quonset-style main facility, rooftop deck, beer garden and expansive lawn for concerts and events, founder Todd Baldwin said he’s feeling the pinch, but cautiously optimistic.
“The costs for all supplies and ingredients have gone up. Similarly to the increase in gas prices, just not at the same frequency,” said Baldwin, who opened the veteran-owned brewery in 2013 in a nearby industrial area off Forge Road.
Prices are the most expensive he’s seen since he launched the brewery, Baldwin said. Red Leg buys on “long term bulk contracts,” and right now has enough “product and cans needed to continue supporting our customer base both within our facility and Colorado Springs,” Baldwin said.
Many small brewers don’t have such options, or resources, at their disposal.
“The costs of all commodities we utilize in our entire process are currently increasing at rates that we haven’t experienced before in our nine years of operation,” he said, in an email. “For budgeting purposes, this has proven to be a large challenge to predict future opportunities and will likely stymie growth in the coming years for small businesses.”
Baldwin said he still believes the industry locally is in a good position to weather the continuing storm.
“The Colorado and Colorado Springs beer scene is stronger than it has ever been. Breweries here are investing and it’s going to be a wild ride for the short term,” he said.
He said he expects small businesses will need to be more cautious with expansion than larger corporations with greater access to financing, though.
Matt Dettmann didn’t hesitate when Trinity Brewing came on the market during the height of the pandemic in 2020; he bought it. About a year later, he acquired the former Red Leg spot on Forge Road and opened it as a rebranded Trinity taproom earlier this month.
“When Todd Baldwin built the ginormous new brewery at Garden of the Gods Road, I really wasn’t even thinking of expansion. Thankfully we just had a great, busy year,” Dettmann said.
It was an investment in the future, whichever way the future might break.
“Financially it was not something I was prepared for, but the opportunity was big enough, and that could be a very good thing for the very long term,” he said. “If this continues with no end in sight, with costs, there might be a significant slow down in new breweries popping up, and to have two would not be a bad thing in serving the community.”
Skyrocketing prices have hit every aspect of Trinity’s operations, at both locations, but for the moment, at least, Dettmann has a strategy.
“I’m not noticing it on purpose. At some point I will be forced to notice it, but right now I’m just going to look the other way and pray that it stops,” he said.
WeldWerks had that attitude once, too.
But after three years, exponential cost overruns and no end in sight, the project in the Springs potentially jeopardized growth at the home base in Greeley where production expansion is underway to help the brewery meet demand. The company saw more than 30% sales growth during the pandemic, as it continued expansion into out-of-state markets, Fisher said.
“If we had a crystal ball or a time machine in 2019 we would have realized that our production expansion was going to be a much higher priority than our second location,” he said. “I think we could have done a really great job in the Springs.”
WeldWerks wanted it to work. Others did too. Not because Colorado Springs necessarily needs one more purveyor of craft libations, but because WeldWerks is WeldWerks and of all the places they could go, the company chose the Springs.
“I think that’s the one thing that hasn’t changed. We still think of Colorado Springs as our second community, more so than some of the other metro areas,” Fisher said. “Not that we don’t love all the other metro areas in Colorado, there’s just something that resonates about Colorado Springs.”
He said that when — and if — WeldWerks is ready to plant new roots outside Greeley, the Springs will be high on the list.
“We’ll never say never. But for now, it’s kind of off the table,” he said.
