Fate of S.F.’s Anchor Brewing takes shape

The bidding has begun for Anchor Brewing Co., a 127-year-old piece of San Francisco history considered the nation’s first craft brewery.

Four months after its owner, Japanese brewing giant Sapporo Holdings Ltd., chose to shut it down and liquidate its assets, prospective new buyers are lining up to buy Anchor in three parts.

For sale — together or separately — are the real estate in Potrero Hill where Anchor has brewed since 1979; Anchor’s brand and intellectual property, including recipes and more than a dozen active trademarks like “steam beer”; and Anchor’s brewing equipment, ranging from a state-of-the-art canning line to the more antique copper kettles and open fermentation vats used to make that trademark beer.

Nonbinding indications of interest were due Friday, Nov. 17, but offers received after that deadline will still be considered.

“There is strong interest by potential buyers,” Anchor spokesperson Sam Singer wrote in an email, including from buyers who would keep all the assets together, but he did not identify

any specifically.

Anchor’s real estate, seen as by far its most valuable asset, was listed in October for $40 million. The 2.17-acre property includes Anchor’s main brewing facility at 501 De Haro St., and a taproom across Mariposa Street at 495 De Haro St., totaling 108,728 square feet.

Lovers of Anchor’s historic Potrero brewery, such as Dave Burkhart, author of a company history, “The Anchor Brewing Story,” fear that developers who would

raze the site for condos will outbid other buyers who might keep the brewery going.

Other bidders, like Patrick Machel, part of a group of former Anchor employees called the Anchor S.F. Cooperative, are willing to part with the brewing facility. Anchor S.F. Cooperative is fundraising toward a planned bid for just the company’s intellectual property, which Machel expects to sell for at least $2.5 million. If their long shot is successful,

Anchor S.F. Cooperative might rent back the old facility from its new owner, or set up the brewery somewhere else in San Francisco. And rather than bid on Anchor’s old brewing equipment, they’d buy newer equipment suited to smaller scale brewing.

Singer, the Anchor spokesperson, said in July that Anchor was forced to close because it was losing millions of dollars a year. Sapporo, which bought Anchor in 2017 for $85 million, laid off Anchor’s 61 employees and began a process known as Assignment for the Benefit of Creditors, an alternative to bankruptcy meant to pay back its creditors as quickly as possible.

Sapporo designated an interim management firm called SierraConstellation Partners to handle the process; representatives for SierraConstellation Partners did not respond to requests for comment.

Bidding for Anchor’s assets is being managed by Hilco Corporate Finance, an investment bank that specializes in distressed asset sales.

“We’re highly confident that the brand will continue,” said Teri Stratton, Hilco senior managing director. She declined to offer a timeline for the bidding or identify interested parties.

Burkhart, the Anchor historian, also declined to name potentially interested parties who have sought him out for advice. But he remains hopeful that one of them can keep brewing Anchor, ideally in Potrero Hill.

“It’s as plain as day that Anchor is the sole survivor of the golden era of brewing in San Francisco,” said Burkhart — surviving bankruptcies, fires, earthquakes, “you name it.”

“I would count the most recent turn of events at the brewery to be another disaster, but that will be determined,” he said.

Scott Strazzante/The Chronicle The taproom, as well as Anchor’s brewing facility across the street, its trademarks and all its recipes, are for sale in a bidding process now underway.