NEW ORLEANS — What exactly is happening at Faubourg Brewing Co.? Recent statements from its parent company raise more questions than provide answers.
On Nov. 14, WWL TV reported that the Alabama-based brewery Made By The Water (MBTW), which bought a portion of Faubourg in 2022, announced that it plans to stop brewing and packaging operations at Faubourg’s nearly four-year-old facility on Jourdan Road in New Orleans East.
But, in a statement to the station, MBTW also said the facility “is not closing at this time.”
“Made By The Water has reached a point where the brewing facility in New Orleans East cannot meet the current demands of our family of breweries,” wrote Faubourg co-owner and MBTW CEO Alexi Sekmakas. ‘While our first preference was to expand the brewery operations at our current facility, unfortunately, despite our best efforts and those of local stakeholders, that is not feasible. As a result, we are shifting most of our brewing operations to other MBTW facilities and contract brewing partners while we explore options for a new manufacturing home in the area.”
Sekmakas didn’t clarify what about the facility prevented it from meeting the brewer’s demands, but he said the plan is for MBTW to maintain its corporate headquarters at the 200,000-square-foot Jourdan Road facility, and that the taproom and event spaces remain open. He also didn’t say where they might brew Faubourg in the future.
Made By the Water also owns and operates Oyster City in Apalachicola, Florida, Catawba in Asheville, N.C., and Palmetto in Charleston, S.C. It purchased a portion of Faubourg from Saints and Pelicans owner Gayle Benson, who still has a major stake in the brewery.
Biz New Orleans has reached out to Made By the Water, Faubourg and Benson’s team for comment. In the meantime, here’s some context here to consider:
Craft beer sales have been on the decline since the pandemic.
“The amount of packaged craft beer sold at grocery and other chain retail is shrinking,” reported industry website goodbeerhunting.com in October. “Over the most recent 52-week period tracked by market research company Circana, the category is down -6.7% in volume and -2% in dollar sales despite increased prices.”
And this downturn comes after a period of rapid expansion. A decade ago, there were about 2,500 craft brewers in the country. Now there are nearly 10,000. As beer sales drop, many brewers are making tough business decisions.
In Louisiana, a state that’s notorious among craft brewers for laws that favor “Big Beer” (Budweiser and Miller) and its distributors, some popular craft brewers are preparing to get out of the distribution business altogether and focus on serving customers in their tap rooms instead, where the margins are better and revenue is more predictable. NOLA Brewing Co. owner Doug Walnar, for instance, is in the midst of making such a move.
Abita Beer is the biggest craft brewer in the state, followed by a second tier that includes New Orleans-based Urban South Brewery, Parish Brewing Co. (from Broussard, near Lafayette) and Hammond’s Gnarly Barley Brewing Co.
Abita sells more than 100,000 barrels of beer and soda annually. Urban South sold about 23,000 barrels of beer in 2022. The other two are somewhere in that range as well. Faubourg, meanwhile, reported that it sold about 12,500 and barrels in 2021.
There were challenges to the relaunch of Dixie (then Faubourg).
Some industry insiders believed the brand’s relaunch was problematic from the beginning.
Near the end of his life, Tom Benson wanted to revive a beloved brand from his younger days, but many younger people thought the name “Dixie,” which is linked to a romanticized image of the pre-Civil War South, was no longer viable.
After Benson’s death, his widow Gayle continued the mission, and led the creation of a roughly $30 million facility on the site of a former warehouse in New Orleans East. The Dixie brewery, which was also designed to bring economic activity to an underused industrial site, opened to the public in 2020.
Later that year, after the nationwide racial reckoning after the murder of George Floyd, the brewery announced it would change the name of its namesake beer. Benson and her team sought input from the community and landed on the name Faubourg, French for “suburb,” which resonates with New Orleans but probably doesn’t mean much to people outside the city.
Some observers think the name change and Faubourg’s out-of-the-way location created obstacles to the brand’s relaunch.
We’ll continue covering this story as we hear back from stakeholders, but as you consider the possibility that Gayle Benson spent a good deal more than $30 million for the now precarious Dixie/Faubourg relaunch, don’t forget that that number is about half the guaranteed amount that her football team spent bringing Derek Carr to New Orleans.
