Lagunitas Brewing Co. unveiled plans Tuesday to build a production facility in Chicago, a major expansion that could make the homegrown Petaluma company one of the biggest craft brewers in America.
The company, which is on the verge of completing a $10 million expansion to its Petaluma brewery, plans to build an identical brewhouse in the midwest.
Together, the breweries will have the capacity to produce 1.2 million barrels when the Chicago brewhouse is complete in October 2013.
"This is one of the coolest things ever, to be able to do this," said owner Tony Magee, who was born and raised in Chicago.
The Chicago brewery will eventually handle distribution in Eastern states while the Petaluma location serves the West, Magee said.
"At this point, about 40 percent of our sales are in states from Denver east," Magee said. "There's a lot of freight associated with that, and Chicago is absolutely the crossroads of the country."
The Chicago expansion will cost an estimated $15 to $18 million, and is being funded through the company's profits and loans from Sonoma Bank, Magee said.
Founded in 1993, Lagunitas has grown from a microbrewery selling its India pale ale in the North Bay into a national brand distributed in 32 states. Its beers will be sold in all 50 states by the end of summer, Magee said.
Sales soared 56 percent last year to $39 million, up from $25 million in 2010. Production is on track to jump an additional 50 percent this year, to about 240,000 barrels of beer, Magee said.
The expansions in Petaluma and Chicago will vault Lagunitas onto an entirely new stage.
In 2010, it was the nation's 17th largest craft brewer, according to the Brewers Association, an industry trade group. If it produced 1.2 million cases - its full capacity after the expansion - Lagunitas would have been the second-largest craft brewer in the United States last year, behind only The Boston Beer Co., which makes Samuel Adams.
Changing consumer tastes have helped fuel the company's growth. Overall, beer sales declined 1.3 percent in the United States last year, according to a report issued by the Brewers Association. But sales of craft beer climbed 13 percent by volume.
"It's becoming increasingly clear that with the variety of styles and flavors to choose from, Americans are developing a strong taste for high-quality, small-batch beer from independent brewers," Paul Gatza, the association's director, said in a statement last month.
Magee announced the Chicago expansion in his typically irreverent fashion: in 140-character bursts to his 6,380 followers on Twitter.
"We're gonna make a little bit o' NorCal right there in the City of Chicago," Magee tweeted. "Cheers all!"
The tweets quickly became the buzz of the beer world.
"In this world, Twitter is pretty intimate," Magee said Tuesday. "I know that those people are the ones that get it, and dig us, and will understand when I say something. So I thought it would put it out there, and if it grew it grew, and if not then it wouldn't be that interesting to the world."
The company, which employs 150 people in Petaluma and around the country, will eventually hire 100 in Chicago, Magee said. The Petaluma expansion will be completed next month.
"Once this capacity is all online, it will be a beautiful thing," Magee said. "We'll be making beer like crazy here."
UPDATED: Please read and follow our commenting policy: