ROANOKE — Amid a national slowing of the craft beer industry, Ballast Point Brewing’s Roanoke-area tasting room and kitchen will close Sept. 29 after a little more than two years in operation.
The Daleville brewery will remain open, said Maggie Bowman, a spokeswoman for Constellation Brands, which owns San Diego-based Ballast Point.
The company did not give a specific reason why it was closing part of its East Coast facility beyond saying that “growth in craft beer is being driven largely by local brands” and, in light of that, they are “reallocating Ballast Point investments to drive growth in core local markets.”
Constellation Brands, the third-largest beer company in the country, also closed two Ballast Point Brewing facilities in Southern California and canceled a plan to open a brewpub in San Francisco this year, according to Brewbound, a trade publication.
Ballast Point, which was founded in 1996 and is best known for its Sculpin IPA, opened its Daleville tasting room and restaurant in June 2017 in a 260,000-square-foot building that also houses its East Coast brewery. The closure directly affects 25 full- and part-time employees and 16 temporary employees, according to a news release from Botetourt County.
The brewery will become an innovation hub for Constellation Brands to produce new beers, flavored malts and hard seltzers, Botetourt County Administrator Gary Larrowe said. He said the social and community aspect created at the tasting room will be a loss.
“We’re disappointed in today’s news, but the sun cannot shine every day,” he said. “We have enjoyed Ballast Point. They’ve been great folks to work with.”
Nationally, the craft beer segment is growing, but more slowly as people drink more wine and spirits. The craft beer segment grew 4% in the amount of beer sold by volume in 2018, but at one time it was expected to grow 20% by next year, according to the Brewers Association, a trade group representing small and independent craft brewers.
Still, despite the slower sales growth, more than 1,000 new breweries opened across the country in 2018.
Bart Watson, chief economist for the Brewers Association, said the organization saw that same level of growth in the first half of this year and expects the total number of breweries to rise sharply.
Watson said the Ballast Point news matches what he has seen nationally.
“It’s challenging to build national brands right now,” he said. “We see brewers that are able to do it, but you have to stand out to be relevant.”
Watson said the farther that breweries expand out of their home base, the bigger challenge they have in building loyalty with consumers, who are more likely to support craft breweries based in their own towns or regions.
Watson said most of the growth he sees in the industry is coming from microbreweries and brewpubs operating in tight geographical areas.
Deschutes Brewery announced in 2016 that it would build its East Coast expansion in Roanoke — a $95 million project that would employ more than 108 people. But last year, the company said market conditions had caused it to re-evaluate. The company bought the land for its project outright to free itself from a performance agreement and timeline. The project likely will be smaller than originally planned.
Deschutes, which is based in Bend, Ore., is not the first West Coast brewery that canceled its expansion plans on the East Coast. California-based Green Flash brewery, which opened in 2002, took on debt to open a site at Virginia Beach in 2016. But last year, it shut down that location and stopped distribution in multiple states.