Anchor Distilling keeps the spirit of S.F. in its new name
Last year, when Anchor Brewing announced its sale to Japanese beer giant Sapporo, the fate of Anchor Distilling — the company’s quieter side, known for spirits like Junipero gin and Old Potrero whiskey — went conspicuously unexplained.
Anchor Distilling, both a producer and an importer of high-end spirits, was not acquired by Sapporo in the beer deal, but its building was. So, too, was its name: Sapporo got the Anchor trademark. Soon, Anchor Distilling learned, it would have to vacate the only building it has ever known, on Mariposa Street in Potrero Hill, and change its name.
Now, five months after news of the sale, Anchor Distilling has announced its new moniker, rechristening itself as Hotaling & Co., a nod to a notorious 19th century whiskey warehouse in San Francisco.
“We wanted to choose a name that talked to our past but also had a deep connection to our home in San Francisco,” said Dennis Carr, the company’s president and CEO.
This won’t be the first time Hotaling’s name appears on an Anchor bottle. The distillery produces a small amount of Old Potrero Hotaling’s Whiskey, a pot-distilled single-
malt rye. It was first released in 2006 to commemorate the anniversary of the 1906 earthquake, which Hotaling’s whiskey warehouse famously, and improbably, survived.
“We’re changing our name in part because of the sale, and because we have to,” Carr said. But he noted the shift also signals an important moment of independence from the icon of Anchor Brewing — as a business, as a brand and as a San Francisco power player.
“We’ve always been in the shadow of the brewery,” he said. “Now, maybe we can do for spirits in San Francisco what Fritz (Maytag, Anchor’s former owner) did for beer in San Francisco.”
It’s a good time to be a distiller. Carr confirmed that Anchor Distilling’s profits outpace Anchor Brewing’s. He wouldn’t elaborate, but more broadly, U.S. spirits sales have been growing faster than those of beer for the past five years. In particular, dollar sales of premium spirits, which are hugely important for Anchor Distilling, grew by 5 percent in 2017 and now make up more than half of total spirits sales.
So what, exactly, was this old whiskey warehouse? A.P. Hotaling & Co. was founded in 1865, predating the original configuration of Anchor Brewing by three decades. Its founder, Anson Parsons Hotaling, came to California from upstate New York for the Gold Rush. He soon gave up panning and found work in a liquor store at Sansome and Jackson streets. Eventually he bought out the store’s owner, expanded the store into a wholesale business and moved it to a larger space on Jackson Street.
For a time, Hotaling’s warehouse was the largest liquor business in the city, with Cutter’s A1 Whiskey ($7 a bottle, as of 1902) its flagship product. An advertisement in The Chronicle from the early 20th century refers to A.P. Hotaling & Co. as “distillers agents and distributors of gins and Kentucky whiskeys.” It’s a description that would nearly fit Anchor Distilling today.
Thanks to the 1906 catastrophe, A.P. Hotaling lived on in public lore longer than it might have. The warehouse was virtually the only survivor of the post-earthquake fires in its neighborhood — an especially impressive feat for a building full of flammable goods. The humor in this was not lost on local poet Charles Field, whose verse would be reprinted in these pages many times over the decades to come:
Ironically, the Hotaling building burned in 1953. It was rebuilt and is now used for offices.
But the rising-fromthe-ashes quality of the Hotaling story appeals to Carr. “This is a rebirth,” he said.
What’s more, the sorts of whiskeys that Fritz Maytag aspired to when he founded Anchor Distilling in 1993 were not unlike those that Hotaling would have produced a century earlier.
Maytag had a fondness for reviving beverages that had fallen out of style: Witness his success with quaint, low-tech steam beer. His first foray into spirits, accordingly, was with rye whiskey, not exactly a booming category in the early ’90s. That pot-distilled product, Old Potrero, was a throwback to the American whiskeys that would have been produced in the 18th and 19th centuries.
Three years later, Maytag added another spirit to the Anchor Distilling lineup: Junipero gin. It, too, was an anomaly for its time, in an era when “premium gin” would have sounded like an oxymoron. But Maytag saw that consumers were beginning to gravitate toward higher-end vodka and made a bet that gin would follow that trend.
It did, and Anchor Distilling took off. The distillery has since added hopped vodka, Old Tom gin and genever-style gin to its lineup. Still, it never reached the fame of Anchor Steam Beer, and its production always remained minuscule, with just four stills tucked into the back of the brewery.
Maytag sold both brewery and distillery in 2010 to Tony Foglio and Keith Greggor, former Skyy Vodka executives. Under Foglio, Greggor and another partner, Berry Bros. & Rudd, Anchor Distilling became an importer of spirits as well as a producer. (As of this month, Greggor is no longer a partner.) Its sales have since grown by 500 percent, according to the company. Many of Anchor’s imports — Luxardo maraschino liqueur; Tempus Fugit Gran Classico amaro; Nikka Japanese whiskey — are now staples of bars around the Bay Area and the country. (Its No. 1 item, surprisingly, isn’t liquor at all, but Luxardo’s jarred cocktail cherries, which brought in $9 million last year.)
The new Hotaling & Co. logo reflects the company’s dual identity. Two pillars represent distiller and importer, “and the space between represents new opportunities to grow,” Carr said.
That growth will mainly take the form of a new distillery and visitor center in San Francisco. Carr said the company hasn’t chosen a location yet but is looking for “an iconic San Francisco building closer to downtown,” around 30,000 square feet. Classes, dinners, private events, lectures, a vintage cocktail book library are part of the plans for what Carr hopes will become the major hub for spirits education in the Bay Area.
The new home will allow the company’s spirits production to grow, from its 20,000case volume to perhaps as much as 50,000.
It’s an ambitious plan for downtown San Francisco, with its notoriously high rents, but Carr said he never considered moving to, say, the East Bay. The company has built its identity on its San Francisco roots, he emphasized. Plus, San Francisco foot traffic doesn’t hurt.
The transition from the Anchor Distilling-branded bottles to new Hotaling & Co. bottles will take place this year. A new whiskey product is already in the works. The existing spirits themselves will remain the same; Bruce Joseph, an employee of Anchor since 1980, is still the head distiller.
If the new Hotaling & Co. can pull it off, this pivot could represent not only a salvaging of the company after the Sapporo sale, but also a coming of age for a business that has always played second fiddle.
“Sapporo forced a definitive moment,” Carr said. “In no way are we trying to turn our back on our history, but there comes a time when you have to leave the house and make something of yourself.”
“If, as they say, God spanked the town For being over-frisky, Why did He burn His churches down And spare Hotaling’s whiskey?”