At least five New York City breweries will pour samples at the 35th annual Great American Beer Festival this week in Denver. When the event launched in 1982, there were none—no surprise, because New York City had no breweries. The last ones, Rheingold and Schaefer in Brooklyn, had closed six years earlier amid an industry-wide consolidation that saw big players such as Miller and Anheuser-Busch swallow competitors and market share. But spurred by an excise-tax cut in 1976 and the federal legalization of home brewing two years later, the numbers locally and nationally began to grow. Today, 30 breweries call the Big Apple home. And there are now more than 4,200 nationwide—a record, according to the Brewers Association trade group.
The New York breweries are all considered micro or craft, the adjectives that have arisen to describe those making beer with traditional methods and ingredients—usually just malted grains, hops, yeast and water (whereas macro brands use artificial preservatives and adjuncts). The first was the Old New York Brewing Co., started in 1982 by Hearst magazine executive Matthew Reich. But it was the biggest one, Brooklyn Brewery, launched by journalist Steve Hindy and Chemical Bank executive Tom Potter in 1987, that touched off the wave of breweries in the boroughs, one that shows no signs of abating: At least six have opened in just the past two years, the New York City Brewers Guild reports.
Craft beer still accounts for less than 13% of domestic beer sales. Craft revenue did increase by 12.8% last year, according to the Brewers Association, while overall beer sales were flat—as they have been for a while. Yet much of craft beer’s recent growth comes from the Brewers Association’s expanded definition of craft. Since 2014, the term has covered breweries that use adjuncts, so long as they don’t produce more than 6 million barrels annually (a barrel equals roughly two kegs). That means larger producers such as Pennsylvania’s D.G. Yuengling and Minnesota’s August Schell now count as craft. Craft sales could thus level off in coming years.
In the 1990s, hundreds of craft brewing companies failed after years of steady growth. The Old New York Brewing Co. was among the first victims (as was its New Amsterdam brewpub, which opened in West Chelsea in 1986). This shakeout had myriad causes, including poor quality control and breweries expanding too fast. By 2000, it looked like craft beer might have been just a fad. Then, renewed focus on quality and customer bases closer to home helped craft beer on its current upward trajectory. Craft brewers also enjoy more support now from state and local governments—particularly in New York, where Gov. Andrew Cuomo signed a farm brewery act in 2013. The law rewards smaller breweries that use state-grown grains, hops and other products with perks such as being able to sell beer by the glass on-site without an additional permit.
New York City is now a focal point of craft beer’s comeback. It’s also at the vanguard of craft-beer culture, a world of specialty beer stores, festivals, tasting tours, home-brewing clubs (the city has several) and beer bloggers. For all the success, though, Gotham has yet to reach peak pale ale. Kelly Taylor, owner of the 10-year-old KelSo Beer Co. in Brooklyn, notes that much smaller cities such as Portland, Ore., and Seattle have a lot more breweries. (Portland, which is home to about 600,000 people, has more than 50.) “We’re not crowded yet,” Taylor said. “We’d need over 150 to be crowded—if you go strictly per capita and not beer-drinking demographic.”
This article originally appeared in Crain’s New York Business.