Craft Beer Industry Grows with SBA Financing
Commercial Real Estate Loans
SBA Small Business Loan
November 6, 2021
You know the hop tide has turned when the so-called “king of beers” has fallen from its throne while craft beer continues to soak up the market share lost by legacy breweries.
A niche industry even a decade ago, craft beer is now a $26 billion business nationwide. In San Diego County alone, its estimated economic impact has surpassed $1.1 billion, according to a recent study produced by the San Diego Brewers Guild, Cal State San Marcos and the San Diego North Economic Development Council.
What’s more, the San Diego region continues to lead the nation in the number of craft breweries, with 150, as of last fall’s count.
“Big beer has taken notice of the growth and impact of craft beer,” the study adds.
SBA Financing Boosts San Diego’s Craft Beer Community
Over the years, many craft beer entrepreneurs have turned to SBA financing to grow and expand their companies. They’ve used this type of financing to acquire production facilities, construct buildings, purchase large equipment, buy products and cover working capital needs.
FE Small Business Finance, a leading small business lender and nonprofit, has helped its share of craft-beer small businesses launch and expand operations with the aid of more than $30 million in SBA business loans.
These craft brewers span the state of California and have come in several shapes, sizes and specialties, from international brand Stone Brewing to up-and-coming brands such as The Homebrewer, based in hipster-laden North Park.
Stone Brewing Leveraged SBA 504 Real Estate Loan to Expand
In 1997, Stone Brewing Co. unveiled its signature brew, Arrogant Bastard, to the masses. About a decade later and an outpouring of critical acclaim, the company continued its ferocious expansion tear with a strategic building purchase.
That’s when Stone’s co-founder Greg Koch approached FE Small Business Finance for SBA 504 real estate financing, which requires from borrowers just 10 percent down. Koch wanted to buy a 57,000-square-foot building in Escondido to grow its brand and secure a stable facility for its operations.
That space later came to be what’s known today as Stone Brewing World Bistro & Gardens. Just two years after that SBA 504 loan was funded, Stone reported creating and preserving nearly 70 jobs, thanks in part to that financing.
Today, the craft beer behemoth employs 1,100-plus employees throughout its operations, which has expanded to other states and even to Europe.
“The great thing about the SBA 504 program was that it made financing available to us that wasn’t available to us elsewhere,” said Koch to FE Small Business Finance in a video interview.
The loan, he continued, “allowed us to do what we do best, which is the business of brewing great beer…And the SBA 504 freed us up to do that job, to focus where we need to focus.”
The Homebrewer Thrives with SBA Loan and Free Business Coaching
The Homebrewer, located in San Diego’s flourishing North Park neighborhood, has evolved from a brew-kit and yeast vendor to adding a small-batch brewery and tasting room, and now to the storefront. Owner George Thornton did this with the aid of flexible financing and dedicated business coaching from FE Small Business Finance.
An SBA Microloan secured through FE helped pay for brewing equipment, mainly large fermentation tanks. The loan also paved the way for an adjoining tasting room — Home Brewing Co.
The microloan came with free business coaching to ensure Thornton was on the right track with his business. Chuck Sinks, head of FE’s business-advising department, works with potential and current borrowers like Thornton to improve credit, craft business plans, and much more.
Even after borrowers are funded, FE Small Business Finance sticks by with borrowers to ensure they’re successful through all stages of their business.
Want to learn more about our loan offerings, from the SBA 504 to the SBA Microloan? FE Small Business Finance offers several financing options for business owners of all sizes and stages.
Tell our loan experts about your business, and they’ll work to match you with a financing plan that best suits you. Let’s talk! Reach us at firstname.lastname@example.org or (619) 243-8667.
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