Tumwater brewery redevelopment could generate more than 600 jobs

If it comes to fruition, a proposed Tumwater Craft Brewing and Distillery Center could generate as many as 662 jobs and more than $101 million for the local economy.

At the same time, the total cost to redevelop the city’s historic brewery site is estimated at nearly $65 million — with about $5.6 million just to preserve the 110-year-old Tumwater brewhouse from further deterioration.

The figures are part of a recent report that provides a strategy for developing the property north of Custer Way. The Tumwater City Council and stakeholders reviewed some of the details Tuesday during a work session at City Hall.

The reports, compiled by Cardinal Architecture and Spinnaker Strategies, examine development scenarios as well as potential costs. The city’s goal is to transform that area into an economic hub with a mix of residential, retail and tourism developments.

The reports take into consideration full development of the site, and a sizeable slice of that cost is related to parking. Potential costs for a multistory parking garage range from $11.5 million for 300 vehicles to nearly $38.5 million for 1,000 vehicles. The study also explores the infrastructure scenarios for access roads, walking trails and a pedestrian bridge that spans the Deschutes River.

In addition, an environmental review is underway for the site that is slated for completion in September. One challenge for development is that the brewery properties are located in the Deschutes River flood zone, according to the city.

Structural renovations to the historic brewhouse will cost about $5.6 million, according to the consultants. Aside from being unsafe to occupy, the vacant brewery tower is vulnerable to weather and seismic activity. The consultants report that preservation can be done in phases, and the next step would be to find a new use for the skinny six-story building.

City officials say the deteriorating brewhouse needs the repairs — and especially a new roof — before it’s too late.

“If nothing is done, it will not stand like this forever,” said Heidi Behrends Cerniwey, assistant city administrator. “This is an icon for this community.”

The Craft Brewing and Distillery Center has the potential to spur further development in the brewery district, Tumwater City Administrator John Doan said.

Tumwater is looking to Eastern Washington for inspiration, specifically Walla Walla, which has embraced wine-related tourism, businesses, partnerships and education programs.

The educational aspect of Tumwater’s center would cross-pollinate with program partners Washington State University and South Puget Sound Community College. Just the education component could generate $30 million a year and help create 271 jobs, the study shows.

Other partners include the Port of Olympia and the Olympia-Tumwater Foundation, which could tap into business incubation and tourism.

Total construction cost for the proposed center is estimated at $17.5 million for a building that’s 29,130 square feet. The cost includes brewing and distilling equipment, land purchase and design. The funding model assumes that Tumwater will contribute $2.7 million.

The long-term goal is to establish Tumwater as a regional focus of craft brewing, distilling, research, education and workforce development. The next step is recruiting partners for the process, such as a contract brewer and an academic entity.

“We believe that’s a model we can replicate here around brewing and distilling,” Doan said Tuesday. Doan said the Tumwater center could be significant for the entire state as it plugs into the network of industry participants such as barley and hops growers, for example. “It makes this site a draw.”

Jon Potter, a consultant with property owner Falls Development, said preserving the historic brewhouse is a top priority. One way to encourage investment in the property is to show potential tenants that there will be an economic return.

“We share the sense of importance to save that structure,” Potter said Tuesday.

The former Olympia brewery property south of Custer Way has sat empty since the brewery closed in 2003. The 800,000-square-foot property is owned by Capital Salvage and still needs a buyer.

Cerniway said there has been a recent “uptick in activity” among potential buyers and the city is hopeful for a sale in the near future.

This story was originally published June 18, 2015 at 10:53 AM with the headline "Tumwater brewery redevelopment could generate more than 600 jobs."