Cloudwater Brew Co faces fight to find new home

30-Nov-2017 - Last updated on 01-Dec-2017 at 09:36 GMT

Hefty bill: Cloudwater's Paul Jones fears £350,000 costs of transferring infrastructure to a new site

Manchester-based craft brewer Cloudwater has a 12-month notice period to move out of its brewery site, co-founder and managing director Paul Jones has revealed.

Speaking at The Brewers Congress in London this week, Jones told attendees that from June 2019 Cloudwater could be forced to move out of its current site, which is scheduled for demolition and redevelopment, with just a year's notice.

Jones said it was uncertain whether the brewery has the liquidity to afford a move to a new site.

“June 2019 also starts a rolling 12-month notice period for us to move out,” he said. “The land on which our brewery exists is earmarked for redevelopment, which will be great for Manchester but it is hard for us to find a new home, and I'm not sure where that leaves us.”

We will be facing a constant pressure from June onwards to find a site we can move into. Can we put ourselves into a position where we have the liquidity to afford such a move? I don’t know.”

The brewery's lease on its current site ends, with no right to auto-renew, in June 2022.

£350,000 bill

Jones said it would cost at least £350,000 just to transfer the brewery’s existing infrastructure to a new site.

“We are duty bound to convert the existing site back to how it was, even though it is scheduled for demolition,” he added.

The brewery’s managing director also used his speech to defend the small breweries' relief scheme, and predicted an uncertain future because of Brexit.

“Because of our production aspirations, we are going to jump from a little bit over the small breweries' relief to some way on the escalator,” he said. “The wonderful thing about the relief afforded to smaller brewers is that we get this break in the first place. If it didn't exist I don't know how we would do this as a business.

“The questions around what to do when we reach this volume and how we proceed from there persist, and they are not easy to resolve."

Duty increase concerns

Explaining the impact the brewery’s growth would have on its tax bill, Jones added: “The effect of breaking through the 5,000hl relief is initially a 16% increase in the duty we pay, and the year after that, if we plateau to around 10,000hl, we will face a 28% increase in duty.

“Given that duty is currently half of our wholesale price, this would be extremely impactful on our ability to turn a profit in 2019. This is a rather big concern. Can we afford to stop growing?”

Jones’s views are in direct contrast with St Austell brewing director Roger Ryman, who told The Morning Advertiser small breweries' relief disproportionately favoured smaller producers earlier this week.

Elsewhere at The Brewers Congress, Tiny Rebel co-founder Gareth Williams launched an impassioned defence of cask beer, while Wild Card head brewer Jaega Wise slammed the use of sexist imagery on pump clips and beer labels.