Kevin Kozak is lonely. As brewmaster of one of the largest craft breweries in the region, Kozak recognizes that competition and collaboration in the area’s craft brewery scene is arguably scarce – even almost nonexistent.

“I grew up in eastern Pennsylvania just 10 minutes from the Yuengling Brewery where I got my first smell of beer,” said Kozak, brewmaster for Wilmington-based Front Street Brewery. “It would be great to have other breweries to talk to and discuss different recipes with each other.”

That could be changing.

As North Carolina lawmakers and local officials begin to grow more cognizant about the impact craft breweries have on economic development and tourism, national and regional brewers are beginning to take note.

And Wilmington may be one center of such brewery growth.

Detroit-based Atwater Brewery announced in April it was considering placing its East Coast brewery and bottling facility in Wilmington, and company officials recently visited the area to scope out potential building sites – an encouraging sign for brewers and economic officials.

“Why not by the beach?” Kozak, who was also elected to the board of directors for the N.C. Brewers Guild in April, said of future craft breweries in the Lower Cape Fear region. “This is a beer-friendly state, and Wilmington could easily capitalize on craft breweries … it’s really exciting, and the city has tons of potential.”

Craft beer brewing and its distribution is big business in North Carolina.

Beer distributors and makers pumped more than $1.3 billion back into North Carolina’s economy and employed more than 3,500 people, according to a report released in February by Delaware-based Center for Applied Business & Economic Research.

Kozak said that doesn’t surprise him, adding that over the past two years, state legislators have passed legislation aimed at helping craft breweries grow.

In 2011, then-Gov. Beverly Perdue signed into law legislation that allows local breweries to self-distribute and sell craft beers from their breweries – an act that Kozak said put North Carolina on the map. That same year, legislators also passed a bill allowing breweries that sell growlers – a large refillable container that is often no larger than 2 liters – to be refilled by any off-premise craft brewer, as long as a proper label is attached to the growler.     

“It was huge,” Kozak said of the legislation. “It really set the pace for breweries to grow in the state.”  And some see Wilmington as the next beer frontier of the state. 

Atwater Brewery is looking to place its East Coast brewery and bottling facility somewhere along the mid-Atlantic, said P.J. Doherty, founder and managing principal of Wilmington-based Carolina Commercial Investment Properties that is assisting the brewery locate sites in greater Wilmington.

Doherty said the operation could hire between 30 and 70 people and occupy 75,000-100,000 square feet of industrial space.

In June, Atwater officials viewed numerous properties across the area, including land owned by the city and Cape Fear Community College along Front Street near PPD’s corporate headquarters. The brewery has also looked at property bounded by Dawson, Wooster, Third and Fifth streets near the Cape Fear Memorial Bridge that local developer and downtown advocate Billy Forbis owns.

It’s competitive since Atwater is also considering sites in other North Carolina communities, South Carolina and Georgia. But after a beer crawl last month highlighting the company’s popular brews brought out hundreds of fans, officials were encouraged.

Now, the waiting game begins as Atwater continues its extensive site selection process. “I think they were pleased with their visit and the area,” Doherty said. “They are still looking at other sites, but I got the feeling they were impressed with Wilmington and the support they received from the community during their visit.”

This is not the first time beer operators have considered Wilmington’s potential as an East Coast craft brewing and distribution destination.

San Diego-based Green Flash Brewing Company met with Wilmington Business Development officials earlier this year to discuss the possibility of placing its East Coast operations in the Port City, said Scott Satterfield, CEO of Wilmington Business Development.

“We had lengthy discussions with them, and they physically visited our area for a couple of days,” Satterfield said of the California brewing company. “We were involved in the early stage, and the company completed an expensive site search.”

It appeared Green Flash was all but set on placing its $20 million, 58,000-square-foot East Coast brewery and craft room in the Port City. But company officials ultimately changed their minds and headed up the coast to Hampton Roads – sending 41 full-time jobs and its 41,000-barrel a year operation to Virginia Beach, Va., according to March news reports.

Green Flash Brewery officials would not comment about their decision to build the brewery’s second operation in Virginia Beach versus Wilmington.

Satterfield said if any West Coast brewing operation were looking to expand its presence on the East Coast, it would be wise for them to consider mid-Atlantic destinations such as Wilmington, Asheville, Charlotte, Charleston and the Hampton Roads regions.

Roger Johnson, Wilmington’s special assistant to the city manager overseeing economic development, said he sees a similar direction for Wilmington.

“There is ample evidence that craft breweries and their unique spillover have a positive effect on the economy,” he said. “Microbreweries are highly sought after and are highly competitive to recruit.”

Johnson stopped short of saying if incentives play a role in wooing such ventures to the area, adding that the city council is the final authority on whether incentives should be considered for a brewery.

“It would certainly be contingent upon the size and scope of the operation,” he said.

Christine Hughes, senior planner for Wilmington Development Services, said the city’s new urban mixed-use designation could entice brewery development. She added that opportunities for craft brewery growth in the central business district downtown were also possible, depending on the operation.

During a June city council meeting briefing, Hughes said council members asked staff to look into industrial uses in urban settings – a move recently approved by Charlotte City Council members that now allows breweries to setup shop in mixed-use developments across the sprawling city.

“It could be a possibility,” Hughes said of small-scale breweries establishing operations in urban mixed-use designations. “It all depends on the intensity of the operation and where the operation is going to be placed.”

Local brew

As larger breweries consider the Port City to expand their operations, small local brewers are helping build Wilmington’s still relatively new craft brewery culture.

For Raleigh natives Matt Allen and his wife, Amanda, it was one of many deciding factors to establish a craft brewery in Wilmington.

Two months ago, the couple formed Pelagic Brewing Company, where the couple hopes to craft monthly beers based on the season, along with traditional staple beers that would be on tap year round.

“It’s been an idea of ours for five years,” said Matt Allen, who has also been a homebrewer for a number of years. “The craft brewery movement in North Carolina has been very strong.

I would say Wilmington has a lot of catching up to do, but the potential is there, which is why I thought it would be good to start it there.”

The couple is currently looking for space downtown to establish a small brewing operation and retail store, where they hope to sell their brew, merchandise and establish a small eatery that would pair hors d’oeuvres with the company’s beers. The new company also plans to launch a KickStarter campaign to help fund its push into the greater Wilmington market.

They hope to find Pelagic Brewing Company’s new home by the end of the summer. “We looked at space that we really liked on Castle Street but couldn’t get the zoning to work,” Matt Allen said. “We see a lot of growth potential in Wilmington … and see craft breweries as a driver for economic growth.”

John Horton sees the same potential in the Port City.

In April, he purchased the intellectual properties and recipes for Charlotte-based Kind Beers, an outfit first launched by former owner and creator Terry Bumbaugh, and moved its headquarters to Wilmington on Front Street in the Murchison Building.

“It’s been getting great reception,” Horton said. “There’s just not a lot of quantity, which is why we’re not taking on any new accounts.”

Kind Beers, which produced 120 barrels for its recent launch and expects to produce 3,000 barrels in the first year, contracts with a commercial brewer that brews Kind Beers’ recipes. The craft brew is shipped to a number of Wilmington locations, including Copper Penny and Smoke, where it’s served on tap. Kind Beers is also distributed to destinations in New Jersey, Delaware, Washington, D.C., Pennsylvania and South Carolina.

Horton, who is also president of the Cape Fear Beer Festival and a broker with Wilmington-based Laney Real Estate, said he is looking for investors to help distribute the brand across the Southeast and beyond.

“We started a KickStarter campaign to raise funds to help us do a better job launching,” Horton said. “We want to increase marketing, increase the volume … to make it readily available.”

Horton said Kind Beers would soon be sold in the refrigerated section of select grocers and retailers in the coming weeks – a goal the company has outlined since its acquisition.

“The craft beer industry has been growing every year,” he said.

“I wouldn’t be shocked if you see more of these craft brewers come on board.” 

Kozak said the brewery buzz around Wilmington is good news for the city, and a viable path for future economic development and tourism growth.

“I can see eight to 10 breweries easily in the area,” he said, adding that Carolina Beach, downtown and parts of Brunswick County would make for ideal brewery locations.

“When you look at places like Asheville and Charlotte, you have to wonder ‘why not Wilmington?’”