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Wednesday, November 28, 2018

In Shark Infested Waters, the Holiday Ale Fest Thrives

The 23rd Annual Holiday Ale Festival opened for business today in Pioneer Courthouse Square and runs through Sunday. Hardcore fans. as well as clueless newbies, will flock to the festival in droves. At a time when many large beer events are floundering, the HAF is thriving.

There are reasons for everything, of course. In one sense, you could argue that the Holiday Fest got lucky, that it has benefitted by way of timing, location and the evolving and fenetic interest in rare, experimental beers. You could argue that.

But it's a lot tougher to get lucky than it once was. Craft beer events used to draw crowds no matter how poorly they were run, how lousy their location or how mediocre their tap lists. Those days over. The competition for festival patrons is fierce and you have to offer value to reel them in.

What would become the Holiday Ale Festival began as the Winter Ale Festival, an offshoot of the Oregon Brewers Festival. Organizers, including OBF director, Art Larrance, discontinued the event after two years. After a year off, it returned as the Holiday Ale Festival. The historical arc of the event is nicely outlined in a recent post on the New School blog. Highly worthwhile read.

I first attended the event when it was known as the Winter Ale Festival. As noted in Ezra's article, the set up was quaint compared to today. The tents were small and, although it isn't mentioned in the article, made of fabric. As such, you couldn't view the surrounding sights while sipping beer, as is the case today. The beer list was small.

The most significant changes, it seems to me, have occurred since Preston Weesner took over in 2002. I know Weesner from my time working as a volunteer at OBF dating to the 90s. He became a common fixture in the beer fest culture here, involved in a number of area festivals. Those experiences, I suspect, helped shape his vision of the Holiday Fest, which he owns and directs.

Of the decision's Weesner has made (or not made), probably the most important one was staying the course in Pioneer Courthouse Square. He could have moved the event to a larger and less costly venue at any time. He refused to take the bait. Whether by luck, good sense or osmosis, he realized a large part of the event's appeal is its location.

I don't know when the clear plastic tents were introduced, but that was a game-changer. In the early days, it was a little claustrophobic and musty under the tents. The clear tents opened up the world outside the festival, including stunning views of the holiday tree and the surrounding city skyline. The change in ambiance was significant.

The downside of keeping the event downtown was and is the cost. It's an extremely expensive place to host a beer festival due to the setup required for the unwieldy shape of the venue, challenges connected with unloading kegs and other essentials, as well as costs involved in arranging security and adhering to city and OLCC regulations.

With event costs high, ticket prices have escalated almost yearly. The base price this year is $40. Weesner has attempted to deflect gripes about rising prices by curating a list of extremely rare, typically experimental beers. For the most part, you won't find these beers outside this event, which seems to provide value for geeks and novices alike.

One of Weesner's revelations was that the HAF had become so popular that it did not need significant promotion. With that in mind, he stopped offering event passes to bloggers and other beer-centric media several years ago. That community was stunned and has mostly maintained radio silence since. But it hasn't mattered. The event hasn't missed a beat, just as Weesner suspected.

The result of the various moves (and non-moves) is a festival that keeps churning along smoothly, while others struggle in an increasingly competitive market. My guess is the HAF appeals to a wide swath of patrons interested in a boutique beer event in a picturesque setting during what is arguably our most festive time of year. This event pummels each of those targets.

Still, I'm not suggesting you shell out $40 for what I consider to be a stingy drinking package. I haven't attended for several years and have no plans to attend this year. Despite its attributes, I think the HAF stopped being a good value a while ago. The ambiance is terrific, but the beers tend to be more miss than hit for the price, which continues to spike upward.

Don't let my opinion stop you from attending if you are so inclined. I'm admittedly out of step with many of my peers, most of whom look forward to the Holiday Festival every year. That's fine. It wouldn't be any fun if we all had the same views on these things.

Friday, November 16, 2018

Lloyd Center Eyes Future with Migration Burger Shack

Lloyd Center Mall has been in gradual decline for most of the last 15 years. That's not really a secret and there are a variety of reasons. But there are efforts underway to transform the place for the 21st century. Migration Brewing's Burger Shack pop-up is part of that strategy.

The Burger Shack opened this week in the third floor food court area in the space formerly occupied by Billy Heartbeats Diner, a 50's-style eatery. It features cheap eats alongside craft beer from one of the area's aggressively expanding brands. This is billed as a temporary arrangement, lasting through the holidays. We'll see.

Migration, if you aren't aware, has been kicking around the local scene for a number of years. The original location on Northeast Glisan features a popular outdoor patio and practical pub. The second location, opened earlier this year, is a pub and production facility in Gresham. These guys are bigly on growth.

The pop-up menu is pretty dumbed down, perfect for frantic holiday shoppers who need a bite to eat and a break from shopping. The Classic Burger with fries and a soda costs $10. The same items with a beer go for $11. Not bad, eh? They also offer a Double Classic, a Veggie burger and a Fried Chicken sandwich, as well as some sides.

For beer, they're leaning on canned product made in Gresham. They had several choices when I stopped by on opening day. There are also wine and cider options on the board. Ideally, you'd like to see draft beer in a place like this. But that apparently isn't part of the plan for now. It's understandable if the situation here truly is temporary.

Whether the Burger Shack is permanent or temporary, it's a smart move. Migration, which isn't the  household name it might like to be, exposes its brand to a general audience that's more likely to buy beer in stores than hardcore beer fans. With the brewery expanding production and finding spots on more store shelves, the timing is ideal. Marketing 101, you might say.

This a win-win for the mall, as well. They're adding another food option for mall patrons to visit during the high traffic holiday season. Plus, this is the kind of place that will appeal to millennials who like craft beer, but aren't necessarily fans of mall culture. That's probably especially true of Lloyd Center, which has lost some luster and gotten some bad press in recent years.

When it opened in 1960, the mall was widely regarded as one of the best in the country. It has undergone several significant facelifts over the years, the most significant of which was (arguably) covering and enclosing it in the early 1990s. I've belonged to an athletic club across the street from Lloyd Center for 30 years and I've watched some of the changes happen. I've also seen the decline in holiday shopping traffic.

Developments over the last decade or so haven't been especially positive. The growing popularity of Amazon and online shopping in general has crushed traditional retail. Lloyd Center lost anchor tenants (Nordstrom and Sears, for example) and many smaller, non-chain stores. Its movie theater closed years ago. A number of vacated storefronts were in evidence on my visit.

But all is not lost. Mall owners launched a $50 million renovation project several years ago. They've made progress, though much remains to be done. The reimagined mall will place less emphasis on anchor tenants and more on lifestyle concepts and artisan shops. Drawings show a modern movieplex, a fitness center and other modern amenities. On the flipside, a vintage spiral staircase with terrazzo columns recalls the mall's early, open air days.

The Lloyd district itself has undergone a dramatic transformation in recent years, with residential high rises and street-level shops. There's more of that on the way. The updated mall, although it will certainly look to attract visitors from outside the area, will strive to serve the burgeoning residential clientele that lives or will live within walking distance. There are still questions about what the final form will be, but it's sure to be interesting.

As I think about what Lloyd Center might be, I can easily see it housing a couple of pubs and maybe even a brewpub. That scenario would fit with the goal of serving the local residential community, as well as patrons drawn from outlying areas. Whether the Migration Burger Shack is an experiment or the leading edge of what's coming, it makes a lot of sense. The future is now.

Wednesday, November 7, 2018

Runaway Growth and the Craft Beer Bubble

At some point, you start wondering when the next shoe will drop. The hypercompetitive craft beer industry, which had experienced dynamic, runaway growth for nearly a decade, is clearly entering a contraction phase. The bubble may not be bursting, but it is under intense pressure.

Signs of a slowdown began to appear a year ago, with the closures of Lompoc's Hedge House and Widmer's Gasthaus pub. Months later, General Distributing sold to Columbia, a move precipitated largely by perceived instability and a lack of confidence in where the market was headed.

More recently, we've seen additional evidence of turmoil. Lompoc Tavern closed. Seven Brides closed its pub in Silverton. Two Kilts closed in Sherwood. Then Alameda Brewing closed. Yesterday, Portland Brewing announced the abrupt closure of its underperforming pub in northwest Portland.

Alongside all this, we learned this past Friday that Brian Butenschoen is out as executive director of the Oregon Brewers Guild. Butenschoen had served as the leader of that organization since 2005. As of this moment, neither Butenschoen nor anyone at the Guild has explained what happened, beyond the typical canned statement saying they agreed to go their separate ways.

Forget Butenschoen for a minute. That situation may or may not be related to the big picture. When I was interviewed for what became PDX Brew City in 2014, I was asked if I thought there was a bubble forming in craft beer. Of course there was a bubble forming, I said. Whenever I've watched that film as part of an audience, I've heard smug laughter behind that comment.

But it was clear to me at the time that the brewery count was growing faster than demand at virtually every level. There were about 2000 craft-centric breweries in the United States in 2011. By the end of 2013, 2,420. By the end of 2015, 4,544. By the end of 2017, 6,266. By the end of this year, we'll have about 7,000, with 9,000 more in planning. These are crazy numbers.

Portland and Oregon brewery numbers essentially mirrored what was happening nationally. Oregon had 124 breweries in 2011, according the Brewers Association. By 2013, we had 181. By 2015, 228. By the end of 2017, 266. Portland stayed in step. It had about 40 breweries in 2011. Today, the city is home to 77, with 117 in the metro area, according to Oregon Brewers Guild stats.

My assumption back in 2014 was that the insane growth would compromise the entire industry. There's only so much shelf space and so many tap handles to chase. I always figured intense competition would create chaos and price wars that would affect everyone.

Some of that has happened or is happening. But the larger emerging theme is that older breweries and those that have quality issues or poor management or a lack of innovation are struggling or failing. Making good beer is definitely a requirement in the current marketplace, but not the only one.

When I said a bubble was forming, a friend suggested the result would be different than I imagined. He said places that make bad or mediocre beer would be driven out and replaced by those that make good beer. He was right, of course, though I still contend good beer isn't the only thing you need.

Getting back to Butenschoen's situation, he had been director of the Guild for 13 years. That's an eternity. He rode the wave of craft beer's golden age, a time when the industry could seemingly do no wrong. But things have flipped and the industry now faces a new set of challenges.

There are more than 250 breweries in Oregon today, most of them small. The Guild is tasked with serving the needs of the many, as opposed to the needs of the huge and the few. That means collaborating and cooperating with all kinds of operatives across a wide spectrum.

"It's a new world we're experiencing right now in beer," says a reliable industry source. "Everybody knows it. Oregon needs effective leadership if we're going to stay strong in craft. Maybe the Guild felt Brian wasn't the right guy to lead it through the emerging challenges."

Regardless of what's going at the Guild, the industry definitely needs strong leadership to help it navigate the turbulent waters ahead. The era of runaway growth is closing, to be replaced by a period of consolidation and contraction. At least for now.