Destination 2017: San DiegoBy Bruce Glassman

The regular communication and collaboration between the home brewers and the pro brewers helps create a culture of innovation. “Many of the home brewers who have never gone pro continue to challenge pro brewers to experiment with different styles,” says Harold Gulbransen, a former president of QUAFF, or the Quality Ale and Fermentation Fraternity, the largest of San Diego’s home-brew groups and the second-largest such group in the country.

San Diego is now home to 143 breweries, nearly one-fifth of all the breweries in California, and the number is rapidly increasing. Between 2009 and 2014, the number of breweries in San Diego nearly tripled—from 32 to 90—and since then, the count has risen by roughly two dozen every year. Four of San Diego’s breweries, Stone, Green Flash Brewing, Ballast Point Brewing and Karl Strauss, are among the country’s top 50 craft producers by volume. The growth of these large brewing companies—and the proliferation of dozens of great smaller ones—has powered remarkable growth in San Diego beer tourism and beer sales.

In 2015, the most recent year for which data is available, the National University System Institute for Policy Research reported that beer sales in San Diego totaled $851 million, with another $400 million from the brewing industry in estimated economic benefit to the county. In the past seven years, direct employment in the San Diego brewing industry has grown more than 418 percent, according to the San Diego Regional Economic Development Corporation. Estimates for this year put San Diego at the $1 billion mark for beer sales alone. The beer tourism boom has made Stone Brewing World Bistro & Gardens in Escondido the third-most popular destination in San Diego’s North County, right behind the zoo’s Safari Park and Legoland California Resort.

The brewing industry directly supports more than 4,500 jobs in San Diego County and has spawned numerous related businesses—everything from water management consultants and safety experts to architects, engineers and stainless steel brewhouse builders and suppliers. Many local farmers use spent grain and yeast slurry from the breweries to feed their livestock. AleSmith owner Peter Zien makes artisanal cheese from milk he gets from a dairy farm that uses his grain and slurry.

The presence of one of the world’s largest yeast providers, White Labs, also played a role in the rapid growth of the city’s craft beer industry. White Labs—which began producing yeast for Home Brew Mart (later becoming the much-lauded Ballast Point) when it was founded in 1992—was at the forefront of the San Diego beer revolution. White Labs helped drive much of the early innovation creating the San Diego style, and works directly with local brewers to develop yeast strains that produce specific flavors and styles of beer.

“We’ve experienced our own growth alongside San Diego’s up-and-coming breweries,” says Neva Parker, the company’s VP of operations. “Our proximity to these businesses helps foster unique collaborations, which help promote and grow the brewing industry as a whole.”

Another breakthrough for the craft brewing industry came when White Labs began releasing pitchable (ready to use) strains of liquid yeast in the mid-1990s. The pitchable yeast was easy to use and easy to store, reducing the learning curve for new brewers entering the industry. Today, the company stores and maintains more than 700 proprietary strains for breweries, supplies yeast to the majority of San Diego brewers and sells to more than 60 countries from six locations around the world.

By 2010, a little over two decades after Karl Strauss opened, more than 35 breweries were operating in San Diego County. That year, San Diego brewers took home more medals than all of Germany, Belgium or the UK at the World Beer Cup, essentially the Olympics of beer. It was the city’s Judgment of Paris moment, a turning point in San Diego’s reputation as a real brewing force. (It was at that same World Beer Cup that San Diego’s Ballast Point won Champion Brewery, Small Brewing Company category, and its Sculpin IPA won a gold medal, crowning it the world’s best IPA.) Thanks to rising demand for San Diego–style beers abroad, Stone opened the first American craft beer brewery in Berlin in 2015.

All the adulation for San Diego craft beer did not go unnoticed by Big Beer, the massive, multinational companies that have faced waning demand for their less flavorful products as Americans’ beer taste has grown more sophisticated. In September 2015, MillerCoors acquired Saint Archer Brewing for $87 million—the first acquisition of a homegrown San Diego brewery by a big corporate entity. The transaction sent shock waves through the craft community. It drew a line in the sand between San Diego’s independent craft breweries and a new breed of craft breweries acquired by big corporations.

“In that very moment, we realized how center-stage craft brewing had become,” says Jill Davidson, president of the San Diego Brewers Guild. “The fact that a major conglomerate like MillerCoors was taking notice of a small craft brewery that was owned by a bunch of surfers and skateboarders, that was an amazing realization. They understood what we were doing in the market and they wanted in.”

By November of that year, the Saint Archer sale was overshadowed by the purchase of Ballast Point by Constellation Brands for $1 billion. This was the largest buyout San Diego beer had ever seen—indeed, it was the largest craft beer acquisition in history. The question inevitably arose: Are you still a craft brewer if you’re part of an international conglomerate? And would the craft brewing industry be able to stay local and authentic when lucrative buyout offers were dangled in front of its proprietors? When Anheuser-Busch announced it was opening a brewpub in San Diego, San Diego Brewers Guild president emeritus Kevin Hopkins told the San Diego Union Tribune that it “will have a local feel to it when it’s not and will look like craft beer when it’s not. This is not a great thing for San Diego.”

The debate over how San Diego’s small and independent breweries coexist with corporate interests continues today; 10 Barrel Brewing, the brewpub owned by AB InBev, the world’s largest brewer, recently opened downtown, and others will soon follow. Either way, it’s become clear that the San Diego style of beer, whether as part of a multinational conglomerate or an independent business, has gained a national and international foothold.

This new internationalism is perhaps most evident in the San Diego beer community’s recent cross-border collaborations. Proximity to Mexico, which is enjoying its own craft beer and wine boom, has spawned numerous brewing partnerships, and many San Diego brewers have embraced the lighter styles typically brewed in Mexico and incorporated unique Mexican ingredients into their beers—chili peppers, cinnamon, even molé. Miramar’s Duck Foot Brewing recently released a hoppy pale ale brewed in collaboration with Tijuana-based Cerveceria Lúdica. “The Baja craft beer scene is absolutely exploding,” says Duck Foot cofounder Brett Goldstock. “And what better way to be a part of it than to brew a collaboration beer with a Tijuana brewery? Our Mexican friends are doing a lot of really interesting things with their unique culture and native ingredients.”

Soon, San Diego will have an entire brewery devoted to beers that reflect influences from both sides of the border, SouthNorte Beer. According to founders Ron and Rick Chapman, the new brewery, scheduled to open later this year, will be an “American brewery that blends the rustic flair of Mexico with the art of San Diego craft brewing.” And that very well may be the San Diego craft beer industry’s best defense against being swallowed up—by growing and changing on its own terms.