Craft breweries are the newest tenant craze for retail owners. According to research from JLL, craft breweries have increased to 67 total locations in Los Angeles since 2011 and generated more than $90 million in revenue last year. Geographically, there are operators—and as a result opportunities—throughout greater L.A., with hubs in the South Bay, Downtown L.A., the San Fernando Valley, Glendale and Long Beach. To find out more about the trend and where it is heading, we sat down with Devin Klein, an associate at JLL, for an exclusive interview.

GlobeSt.com: What kinds of real estate assets are craft breweries occupying? What are they looking for in a space?

Devin Klein: Craft breweries are occupying industrial or semi-industrial spaces , warehouses &/or large space in commercial buildings. Requirements can include most or all of the following: high ceilings, outdoor area and the square footage capable of housing a brewing system, tap room and parking. Areas targeted are close to existing or up and coming neighborhoods and office markets.

GlobeSt.com: What is driving demand for craft breweries in L.A., and can the market demand support this growth?

Klein: Everyone wants a neighborhood brewery. Going to the local bar use to be something for the young and single but now these specialized bars bring out the young, old, single, married, families and everything in between. They have become local gathering spots for special occasions, business meeting spots or just a simple Sunday night dinner. Menus have become very chef driven as well. What more can you ask for than a frosty mug of craft housemade beer, great food and TV's to watch a game? The breweries that are being innovative with product development and varieties, like flavored barrel aged beers, and are driving the most consumers right now. It would appear that the market is not slowing down anytime soon

GlobeSt.com: How can landlords attract these tenants?

Klein: The larger (typically industrial &/or warehouse type) spaces that have higher ceilings, abundant parking &/or infrastructure in place with access to systems capable of handling this type of an operation are usually the most appealing to the operators. On the other hand, some brewers seeing the major potential in a property that needs everything are paying the extra costs associated with repurposing a space and have come out the other side very successful. Landlords willing to contribute towards the improvements will definitely attract Tenants.

GlobeSt.com: What is your outlook for this real estate niche over the next 12 months?

Klein: I don't think it is an overly saturated market yet. There is still room for growth especially since consumers are spending tremendous amounts of money on food and beverage. Additionally, Landlords are more willing to get creative to make deals right now.

GlobeSt.com: What kinds of real estate assets are craft breweries occupying? What are they looking for in a space?

GlobeSt.com: What is driving demand for craft breweries in L.A., and can the market demand support this growth?

GlobeSt.com: How can landlords attract these tenants?

GlobeSt.com: What is your outlook for this real estate niche over the next 12 months?

Instant Insights /

Craft Breweries, a Hit for Retailers

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