Beer In Ads #2357: It Was A Boy….


Thursday’s ad is from Pabst, from 1895. Many brewers made other related products besides beer, notably malt extract, to be used primarily in cooking as an ingredient in breads and desserts and even as a tonic. According to Briess, which still offers it today. “What is Malt Extract? Malt can be further processed to produce liquid or dried sweeteners called Malt Extracts.” They were essentially “the original starch- or grain-based sweetener.” Many brewers survived prohibition making malt extract, both for legal uses and for homebrewing, but Pabst was making and advertising decades before. In this ad, another beautiful abstract illustration of imagery with barley, hops and the Pabst logo, the “It Was a Boy” text starts a testimonial story of an expecting mother who could feel stronger after drinking a bottle Pabst Malt Extract a day for several weeks, and then gave birth to a son.

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Historic Beer Birthday: Emanuel Bernheimer

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Today is the birthday of Emanuel Bernheimer (August 3, 1817-March 26, 1890). He was born in Baden-Württemberg, Germany, and apprenticed as a brewer in Germany, coming to New York City when he was 27, in 1844. With a partner, August Schmid, in 1850, he founded the Constanz Brewery on East 4th Street near Avenue B, and a couple of years later, with a different partner, James Speyers, he started the Lion Brewery on Columbus Ave, between 107th and 108th Streets in Manhattan, next door to the beer garden at the Lion Park, and indeed it is sometimes referred to as the Lion Park Brewery. The business was reorganized in 1868, and his old business partner August Schmid also became a partner in the Lion Brewery, and by 1890 its official name was the Bernheimer & Schmid Brewery, though they continued to trade under the Lion Brewery name. In 1895, it was the sixth-largest brewery in the U.S. After 1903, it was called the Lion Brewery of New York, presumably to avoid confusion with the many other breweries with Lion in their name. Lion survived prohibition but closed for good in 1942.

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Here’s a biography of Bernheimer from Find-a-Grave, originally from the New York Times, for March 29, 1890:

Emanuel Bernheimer, one of the owners of the Lion Brewery and one of the oldest brewers in this part of the country, died at his home, 351 West Fifty-fifth street, on Thursday, from complaints incident to his advanced age. He had not been in good health for several years, and for some months was unable, save rarely, to leave his house. The funeral will be held at his home to-morrow at 9:30 A.M., the Rev. Dr. Gottheil officiating. The burial will be in the Salem Field Cemetery, the Rev. Dr. Silverman leading the services at the grave. Mr. Bernheimer was born in Germany in 1817, and served an apprenticeship of some years in a brewery in his native country before he came to this city in 1844. When he arrived here it was with some capital, and he engaged in the general importing business in Beaver-street. In 1850 he formed a partnership with August Schmid, and, recognizing the possibilities of brewing in this city, established the Constanz Brewery in East Fourth-street. This was one of the first breweries started here, and it was successful beyond the hopes of the partners. Hundred and Eighth-street, which, with its additions of a big garden and a park for picnics, soon became quite famous, parties being made up in all parts of the city to take the then long trip to Lion Park for an evening’s enjoyment. Mr. Bernheimer began the extensive and elaborate system of advertising which is now a characteristic of the trade, and was the first to establish beer saloons of his own in various parts of the city, gradually disposing of them to their lessees, much the same as is done at present. Under the firm name of Speyer & Bernheimer he continued the business for several years. About 1868 the firm was reorganized by the admission of August Schmid, and a year or so later it was changed into Schmid & Bernheimer by the admission of Joseph Schmid. In 1878 Mr. Bernheimer retired from active participation in the brewery business, his son, S. E. Bernheimer, succeeding him. The business was carried on under the name of Schmid & Bernheimer until Mr. August Schmid died in July, 1889. Then the firm was composed of Mr. Bernheimer’s three sons, S. E., Max E., and Henry Bernheimer. During the civil war Mr. Bernheimer was a liberal contributor to the various funds which were then established. He was a Democrat throughout his life, following his party in national affairs. In local politics he was disposed to be independent. He was one of the oldest members of the Temple Emanu-El, was an active participant in the work of the German Widows and Orphans’ Society, a patron of the Mount Sinai Hospital, the Hebrew Orphan Asylum, the German Hospital, and the Montefiore Home for Chronic Invalids. Besides his sons, he leaves one daughter. His wife died four years ago to-day.

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And this account of Bernheimer is from the West Side Rag:

Emanuel Bernheimer was born in Germany in 1817 and served an apprenticeship there before coming to New York in 1844. He arrived “with some capital” and set up an importing business on Beaver Street. In 1850, he became a partner of August Schmid in the Constanz Brewery which is described as “successful beyond the hopes of the partners.” In all, at its height, the firm of Bernheimer and Schmid owned and operated five breweries, including the Lion, on Staten Island and in Manhattan.

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Bernheimer’s genius seems to have been advertising. He began an elaborate system of marketing which was quickly adopted by his fellow brewers and he established “beer saloons of his own in various parts of the city, gradually disposing of them to their lessees,” not unlike the franchise system of today. The advertisement shown [here] is a perfect example of business savvy combined with some of the higher ideals of the day: “Kings and Emperors will gladly lay down their arms of warfare and drink to the health and happiness of all their peoples. The sun of that golden morn will soon rise and all nationalities will be found drinking our Pilsener and Wuerzberger – the beer of Surpassing quality and lasting flavor.” An image of 19th century paradise accompanied by a glass of Lion Brewery beer. Perfect.

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This is about the brewery from Wikipedia:

Shortly after immigrating to the United States, Swiss-German August Schmid and Emanuel Bernheimer founded the Costanz Brewery at East 4th Street near Avenue B in 1850. The brewery produced a lagered beer, a favorite among German immigrants. By 1852, they built a second Costanz Brewery at Four Corners in Staten Island, home to a large German community. Five years later, Bernheimer became the partner of another German immigrant, James Speyers and founded the Lion Brewery in 1857 in Manhattan Valley.

A group of Catholic Bavarians helped build the Lion Brewery. When it was built, they held masses in the Brewery on Sunday mornings.

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At its peak, the Lion Brewery occupied about six square city blocks, from Central Park West to Amsterdam Avenue and from 107th to 109th Street. At the time Manhattan’s Upper West Side was an open area with inexpensive land housing, many public institutions and an insane asylum. There were about five to ten thousand living in shanties after being displaced by the creation of Central Park in 1859. Consequently, with the brewery and surrounding areas, the Upper West Side failed to increase its real estate value until the early twentieth century.

In 1862, a $1 tax on each barrel of beer hurt small brewers but not Lion. The anti-saloon movement in the late 19th and early 20th century encouraged Lion to clean up its own saloons. Lion Brewery got caught up in a wave of mergers and closings among some of the smaller New York Brewers in the early 1940s which continued until 1941, when the business closed. The brewery (including the canning facilities) was auctioned off on August 26, 1943. The plant was demolished in 1944 and more than 3,000 tons of steel were taken from the original brewery structure and recycled for the war effort.

After the Brewery was knocked down the lot was paved over with cinders. On Sundays, after the war, returning World War II Veterans formed a Softball League and played almost every Sunday afternoon. Home plate was located near 107th street and Columbus Avenue. Today, apartment houses occupy the Lion brewery’s former location.

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Around 1860, the brewery published a pamphlet titled “Observations on Brewing and Beer: With an Analysis and Scientific Testimony Relative to the Lager Beer of the Speyers’ Lion Brewery.” The pamphlet had a short history of the different kinds of beer, and an analysis showing that their lager beer was pure. The pamphlet also included some great line drawings of the brewery complex.

And here’s another story from Rusty Cans:

In 1850 recent Swiss German immigrants August Schmid and Emanuel Bernheimer founded the Costanz Brewery at East 4th Street near Avenue B. The brewery specialized in lagered beer, a favorites among their fellow immigrants. By 1852, their success encouraged them to build a second Costanz Brewery at Four Corners in Staten Island, then home to a large German immigrant community. Eight years later, Bernheimer became the partner of another German immigrant, James Speyers, in his Lion Brewery, established in 1857.

The Lion Brewery, depicted here, occupied a site bounded by what are now Central Park West and Amsterdam Avenue and extending from 107th to 109th Streets. The background view includes Central Park, with a glimpse of the Blockhouse, a relic from the War of 1812. (The Church of the Ascension is there now, built with the brewery’s help in the 1890s). During this period Manhattan’s Upper West Side was a relatively open area offering inexpensive land and it accommodated numerous public institutions including an insane asylum. Also clustered in the neighborhood were the shanty homes of between 5-10,000 thousand people displaced by the formal opening of Central Park in 1859. The combination of shanties, public institutions, and such foul-smelling industries as breweries explains why the Upper West Side failed to develop the real estate value of other areas bordering Central Park until the early twentieth century.

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Late in the life of the Lion Brewery, it became involved in a number of mergers and acquisitions, eventually becoming The Greater New York Brewery, Inc.:

Lion brewing got caught up in a wave of mergers and closing among some of the smaller New York Brewers in the early 1940s. In late 1940, the Fidelio Brewing Co., located at 1st Ave. between 29th and 30th Streets., closed. However, on November 15, 1940, it reopened business as the Greater New York Brewery, Inc. In December 1940, the Greater New York Brewery merged with the Horton Pilsener Brewing Co., which was located at Amsterdam Ave. and 128th Street. Horton Brewing President Alex White became a director of Greater New York Brewery and they continued producing previous Horton products. In January 1941, the Greater New York Brewery merged with City Brewing Corporation of Queens. In February of 1941, Horton, as part of Greater New York Brewery, closed its doors. On April 9, 1941, City Brewing Corporation, as part of Greater New York Brewery, temporarily had its license canceled because of illegal merchandising in the form of gifts to retailers. (It apparently reopened at a later date.)

In May of 1941, Greater New York Brewery, Inc. acquired the Lion Brewery. It was the only brewery of the four that merged that had facilities to package beer in flat top cans. But by February of 1942, the Lion Brewery was closed and put up for sale. There being no buyers, the brewery (including the canning facilities) was auctioned off on August 26, 1943. In 1944 over 3,000 tons of steel were taken from the original brewery structure and recycled for the war effort. In April, 1946, the Greater New York Brewery, Inc. became known as the Greater New York Industries. This entity remained in operation until 1950.

For its short lifetime the former Lion Brewery continued to produce beer in cans labeled as products of the Greater New York Brewery. The two flat tops produced are scarce, but not truly rare. However, during its short life span, the Greater New York Brewery also produced a very rare crowntainer and two rare quarts containing Lion beer and ale. There are only 3 of the Beer quarts known today and the Ale is not much more common. Another rare Lion can, a Lion Pilsner, was produced by Pilsner Brewing in New York in the 1940s, but I do not yet know this company’s relationship to the original Lion Brewing. Today, apartment houses occupy the Lion brewery’s former location.

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Beer Birthday: Steve Donohue

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Today is the 46th birthday of Steve Donohue, former brewmaster at Firehouse Grill & Brewery in Sunnyvale, California. Steve is an unsung brewer who deserves more accolades and fame. After Firehouse, He spent some time brewing at Hermitage Brewing while working on opening his own place. Steve’s brewery, Santa Clara Valley Brewing is now open and, not surprisingly, going gangbusters. Join me in wishing Steve a very happy birthday.

Steve Donohue from Firehouse Brewing
Steve at last year’s 22nd Celebrator anniversary party at the end of SF Beer Week.

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Steve with Peter Cogan from the Tied House, during the 2009 Celebrator party.

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Hermitage assistant brewer, Steve, Peter Licht and me during a visit to the Hermitage Brewery in San Jose a few years ago.

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Pete Slosberg with Steve.

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Steve Altimari, brewer at High Water Brewing, Steve and Steve Shapiro, from Beer by Bart.

Note: Last two photos purloined from Facebook, taken by Arie Litman.

Sapporo Buys Anchor Brewing

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This morning Anchor Brewing and Sapporo anounced that Sapporo Holdings Limited was acquiring all of the equity interest in Anchor Brewing Company, and that they’ll take over at the end of the month, August 31. As large as the beer industry is, it’s also a small community where everybody knows everybody, and everybody talks. As a result, there are few secrets. This was one of those rumors that has been circulating around the beer world for months. It’s a rumor everybody was talking about but no one could confirm, though no one was denying it either. Anchor’s press release holds back the amount of the sale, but the news release from Sapporo gives the transaction as $85 million, which seems like a bargain. Sapporo bought only the brewery; Anchor’s distillery business will be spun off into a separate company.

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Here’s Anchor’s press release:

San Francisco, CA (August 3, 2017) – Anchor Brewing Company announces that Sapporo Holdings Limited will be acquiring the company with plans to continue Anchor’s traditions and legacy in San Francisco while growing the brand globally. Anchor Brewing Company’s flagship beer, Anchor Steam® Beer, has been brewed in San Francisco since 1896. Sapporo has a long-standing history in Japan dating back to 1876 and an appreciation for tradition, craftsmanship and provenance which are all fundamental tenets of Anchor.

“Sapporo shares our values and appreciates our unique, time-honored approach to brewing,” said Keith Greggor, Anchor Brewing Co-Owner. “With both a long-term vision and the resources to realize it, Sapporo will keep brewing Anchor’s beers in San Francisco while expanding to new markets worldwide.”

“Anchor Steam Beer is a San Francisco original, inspiring a new generation of brewers and beer lovers around the world,” said Masaki Oga, President and Representative Director, Sapporo Holdings LTD. “Both companies share a brewing philosophy backed by long histories and this transaction enables both Sapporo Group’s US business and Anchor Brewing Company’s global business to make a further leap forward.”

More than 50 years ago, Anchor started the modern craft beer movement with a series of innovations. Anchor brewed the first post-prohibition Porter, ignited todays IPA boom when it introduced dry-hopping and the cascade hop and created the industry’s first seasonal beers. Since then, the emergence of thousands of craft breweries within the United States and around the world has created the need for scale and synergies to compete in a growing global market for craft beer.

Anchor’s experienced management team will continue to run the business but now benefit from superior financing and additional resources. Sapporo is committed to preserving and maintaining Anchor’s operations in San Francisco, including the historic Potrero Hill brewery. Sapporo will invest in the brewery to improve production efficiencies and will strengthen all aspects of management and production to ensure the highest quality of beer is consistently delivered. In addition, Sapporo is fully supportive of Anchor’s new public taproom concept that will be opening soon. Sapporo will also export Anchor to new international markets using its global distribution resources.

The transaction is expected to close on August 31st; subject to customary closing conditions. Terms are not disclosed. Anchor Distilling Company is not part of this transaction and will now become a fully independent company in its own right.

Sapporo first made its way to America in 1964. In 1984, SAPPORO U.S.A., INC. was founded to help preserve our high standard of quality throughout the country. Today, Sapporo stands alone as the best-selling Asian Beer in the United States for more than 30 years.

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Sapporo’s announcement on their website is more perfunctory and all-business, but in some ways more illuminating:

Sapporo Holdings Limited (hereinafter “Sapporo Holdings”) will acquire all of the equity interest of Anchor Brewing Company (California, US; hereinafter “Anchor”).

The Sapporo Group plans to further expand its US beer business by adding Anchor, a prominent beer manufacturer which produces the leading brand “Anchor Steam® Beer,” to its group.

1. Equity transfer agreement

Sapporo Holdings will enter into an equity transfer agreement with Anchor’s parent company Anchor Brewers and Distillers, LLC (hereinafter “ABD”). The transaction will be conducted through Sapporo Holdings’ subsidiary, to be established for the purpose of entering into the agreement. Sapporo will obtain all of ABD’s equity interest in Anchor which will join its group companies.

Execution date of agreement: August 3, 2017 (Thursday)

Equity transfer date: August 31, 2017 (Thursday)

2. Rationale behind Agreement

Last year, the Sapporo Group formulated the new Long-Term Management Vision “SPEED 150” through 2026, the year marking the Group’s 150th anniversary since its founding. The vision set forth in Speed 150 is for the Sapporo Group to be a company with highly unique brands in the fields of “Alcoholic Beverages,” “Food,” and “Soft Drinks” around the world.

Regarding its “Promote Global Business Expansion” policy, a key driver of its group growth strategy, Sapporo Group is pushing forward a distinctive plan that designates North America its business base and the rapidly growing “Southeast Asian” region as its highest-priority markets. In the US where the SAPPORO brand has maintained its position as the No. 1 Asian beer in the country over 30 years, the Group has been considering expanding its beer business through the acquisition of a new brand as well as further growing the SAPPORO brand.

Anchor is a prominent and historic US beer producer founded in 1896 in San Francisco. “Anchor Steam Beer,” its flagship brand, is said to be an icon that ignited the current craft beer boom in the US. Armed with its strong brand power primarily in San Francisco, where it is based, as well as other areas across the US, it has been enjoyed by countless beer lovers throughout the years.

The addition of Anchor’s strong brand power and network to the Sapporo Group’s US beer business portfolio through the conclusion of this agreement is expected to accelerate its speed of growth in the US.

3. About Anchor

Name: Anchor Brewing Company, LLC (beer manufacturing and sales)
Location: 1705 Mariposa Street, San Francisco, California, USA
Year founded: 1896
Representative: CEO Matt Davenport
Num. of employees: 160 (as of December 2016)
Production plant: One plant (San Francisco, California state)
Sales volume Approximate: 1.75 million cases (equivalent to 355ml × 24 bottles in 2016)
Annual sales Approximate: 33 million U.S. dollars (about ¥3.7 billion in fiscal 12/2016)

(Note 1) Sapporo Holdings acquired Anchor Brewing Company’s “equity” instead of its shares due to the fact that the latter is a limited liability company.

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This is, of course, big news, especially locally. The Chronicle got the exclusive on the story because Fritz Maytag had a good relationship with his local paper and after the Griffon Group bought Anchor they continued that tradition. So my newspaper group, like everyone else, was a little behind, and while their reporters are working on the story itself, they asked me to write an analysis of what the sale means for beer lovers, written for a mainstream audience, so please forgive the explanations of everyday things known by most beer aficionados. After an introduction similar to the one that began this post, here’s my initial thoughts on the acquisition of Anchor:

We know why Sapporo wanted Anchor. Their 150th anniversary is coming in 2026, and they’ve made it policy “to be a company with highly unique brands in the fields of ‘Alcoholic Beverages,’ ‘Food,’ and ‘Soft Drinks’ around the world.” They call it “Speed 150,” or the “Promote Global Business Expansion” policy. For the last thirty years, Sapporo has been the number one beer in the Asian market, but they have plans to expand worldwide through the acquisition of new brands. For example, in 2006, Sapporo bought the third-largest brewer in Canada, Sleeman Breweries.

Sapporo considered Anchor a prime target, characterizing the brewery as “a prominent and historic US beer producer founded in 1896 in San Francisco. ‘Anchor Steam Beer,’ its flagship brand, is said to be an icon that ignited the current craft beer boom in the US. Armed with its strong brand power primarily in San Francisco, where it is based, as well as other areas across the US, it has been enjoyed by countless beer lovers throughout the years.”

So what about Anchor? Why were they interested in being part of Sapporo? According to the rumors, Anchor’s been looking for funding to help fuel their growth for at least a year, as sales faltered somewhat in recent years. They’ve remained a strong brand, but the many new beers they’ve been releasing haven’t all done as well as hoped, and it’s been widely rumored that capacity has been down. Capacity is the maximum amount of beer a brewery can brew in a year, and the closer to 100% a brewery is, the more profitable they are. According to Anchor’s president, Keith Greggor, they’re currently operating at between 55 and 60 percent. The grand Pier 48 plan to build a new brewery and event space near AT&T Park has been on hold for a while now, and it’s unclear if that will change. What will change is Anchor will have access to expansion money and other resources that a company as large as Sapporo can make available for them. For example, they’ve already announced a new public taproom on De Haro St., across the street from the existing brewery will go forward as planned.

As is almost always the case, initially nothing will change at Anchor Brewing. None of the beers will change, they’ll continue to brew at their location on Potrero Hill and the current management team will remain at the helm. When Fritz Maytag sold Anchor to the Griffin Group in 2010, very little changed initially, though many hardcore beer lovers were concerned. As the beer industry is going through a period of time where breweries being bought by other breweries or financial groups is becoming commonplace, these deals are often met with a backlash. After an announced sale, many vow to no longer drink beer from the acquired brewery. It was particularly strong when Anheuser-Busch InBev bought 10 Barrel Brewing, Golden Road Brewing and several others recently or when Constellation Brands bought Ballast Point.

Most beer drinkers will be unaffected. Most don’t follow the beer industry’s news at all, and just buy the beer they like to drink. That’s what recent history has shown. There’s a small subset of all craft beer drinkers who really do follow the beer news, and care deeply about whether or not the brewery is independent. They’re often vicious on social media and once a brewery has “sold out,” they become dead to them. But in almost every case, the new markets and increased distribution that resulted from the acquisition more than makes up for losing their business and sales overall increase, often dramatically.

The trade association for craft breweries — The Brewers Association — has been promoting the value of independent breweries for many years, and rewrote their definition of a “craft brewery” in part to reflect that but also to determine who can be a member. They also recently rolled out an “Independent Craft Beer Seal” that members can put on their labels to indicate that they’re not owned by another company (or at least not more than 25 percent).

Being bought by Sapporo will make Anchor no longer eligible to be a member of the Brewers Association, which is particularly strange since Anchor Brewery is credited with starting the entire craft beer movement that resulted in the conditions that led to a trade group representing small brewers being viable. So as the days and weeks unfold, it will be interesting to see how hardcore beer lovers react. So far this morning, after the announcement, reactions have been fairly tame, at least compared to previous sales. Maybe we’re getting used to these things. They’ve definitely become part of the maturing of the craft beer industry, and we’ll continue to see many more in the coming years. This is simply part of the ups and downs of any industry.

But many beer lovers tend to be more emotional and feel an attachment to their favorite brewery, much more so than seems to happen in other businesses. Many breweries, in addition to their beer, sell a brand lifestyle that’s a part of the brand’s identity. Small brewers regularly promote themselves as being mavericks, rebels, independent or just different as a way of distinguishing themselves from the larger breweries. And it often works too well, so much so that their fans sometimes feel betrayed when they reveal themselves to have been a savvy business all along. I think with Anchor Brewery, who’s been around since 1896, they’ll be less of a backlash than in some of the more recent high profile sales. Anchor, and Fritz Maytag, re-invented itself in 1965 and sparked a revolution in beer-making. No one can take that away from them as they start the next chapter of their journey. As long as I can still get a fresh Liberty Ale the next time I stop by the brewery, everything will be fine.

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As I’m sure many people are wondering, I asked Anchor’s press contact whether or not Fritz was consulted — not that they’d have to, of course — but just as a courtesy, and if so, what his thoughts were. As far as I can tell, I don’t think they did talk to him (again, not that they had to at all) and this was the response I got:

We think they would recognize the difficult decision we had to make and would approve of the care and diligence we have made in the route chosen. This acquisition and investment insures that Anchor will be able to continue its time-honored brewing tradition in San Francisco for a long time, which was Fritz’s goal when he sold the brewery.