Brewery’s craft beer venue poised for takeoff
Chris Keall
An old Air Force hangar at Hobsonville Point is about to be reborn as a craft beer hall and eatery. The cavernous, 1500sq m Little Creatures craft brewery will open on Waitangi Day, on the heels of a new weekend ferry service which has been partly funded by locals in the tightknit community in Auckland’s northwest.
Lion is spending $20 million on the project, says managing director Rory Glass, and it will employ about 100 staff.
Little Creatures features a brewery capable of producing up to 180,000 litres of beer a year — about 90,000 six packs — plus food outlets.
Customers will also be able to buy beer to take home — a big deal for locals in West Auckland, where supermarkets are dry and the Waitakere and Portage trusts directly control the bottle stores. Little Creatures’ manufacturing licence puts it beyond the trusts’ reach.
Lion is also looking beyond beer. Just before Christmas, the brewer bought Wellington coffee roasters Havana, and Little Creatures will open at 7am to sell coffee to locals on their way to the commuter ferry.
The new venue will also sell kombucha from another recent investment, Tauranga’s Good Buzz, in which Lion holds a 25 per cent stake.
“We want it to be family friendly. We want people to come down and catch up for coffee. We want people to bring their kids here to have fish and chips,” says Glass.“We’ll have a community engagement manager. That’s very unique.”
In Australia, Little Creatures has dished out grants for community projects. Here, community features will include a wall where local artists can display and sell their work, commission-free. Head brewer Udo Van Deventer also wants to have regular teach-ins with locals.
Lion and rival DB have developed a taste for craft beers because it’s the fastest growing segment of the market — although that growth is flattening out.
Glass says while mainstream local beers have had only slight growth in recent years, and international beer sales have declined slightly, craft beers have boomed.
“We’ve seen growth of about 30 per cent, 20 per cent. Now we’re down to about 10 per cent growth — but that’s still growth. New Zealand is the most developed craft beer market in the world. About 17 per cent of all sales come from craft beer. It’s really important that we’re involved in that. That’s one of the key reasons we’re opening Little Creatures at Hobsonville Point.” DB Breweries boss Peter Simons doesn’t want to give figures, but says his company has seen a similar trajectory for craft beer. The craft boom has seen both Lion and DB get out their chequebooks. In recent deals, DB picked up Kapiti boutique beer maker Tuatara for $30.5m, and Lion spent $25.1m for Upper Hutt’s Panhead, $8m for Dunedin-based Emerson’s, and a yetto-disclosed sum for Christchurch company Harringtons. Little Creatures was founded in Fremantle in 2000. In 2012, Lion paid A$256m to convert a minority stake into outright ownership.
“Craft has been absolutely fantastic for beer,” says Glass. “It’s got people talking about beer again in much the same way wine did a number of years ago. So being involved in that craft beer market has been really important for Lion.”
Craft beer has also been good for both the major players’ bottom lines — both through their craft acquisitions and by boosting so-called “premium” mainstream beers.
In 2017 (the most recent year reported to the Companies Office), Lion’s net profit rose 11.5 per cent to $38.7m on sales that increased 5 per cent to $561m. DB’s profit rose 12 per cent to $30.4m on revenue that rose 3 per cent to $514m (Lion is owned by Kirin, and DB by Heineken).
There are just under 200 small breweries in New Zealand, and some big names are still independent, including Epic, Yeastie Boys and Garage Project. But with growth slowing — an ANZ report calls the market saturated — the appetite for deals could be diminishing.
Both Simons and Glass say while craft is still hot, healthier options are emerging as the next big thing — lowcarb, low-calorie and low- or noalcohol beers.