Food and Beverage Industry Plays Key Role in Hudson Valley Economy

The food and beverage sector has been a mainstay of the Hudson Valley economy for some time with the likes of PepsiCo, Dannon and Heineken USA doing business in the Hudson Valley and employing thousands of workers.

The sector has been bolstered by some growing industry players such as: Best Mexican, Gillette Creamery, Harney & Son’s Tea, Sabra Dipping, Captain Lawrence Brewing Co., Crown Maple Syrup, and Manhattan Beer Distributors.

A relatively new industry that has grown considerably both here and across the nation in the past few years is the craft beer industry. Brian Gates, vice president of the HVEDC, told Real Estate In-Depth that the craft beer industry is growing throughout the Hudson Valley region.

In April, New York State released the results of a report that showed the craft beer industry grew by an astounding 59% between 2013 and 2014 with a total economic impact estimated at $3.5 billion, according to a research report prepared for the New York State Brewers Association and the New York Wine and Grape Foundation.

“We have said time and time again that New York produces some of the best craft beverages anywhere, and this report backs up exactly why we are focusing on growing these breweries,” Gov. Andrew Cuomo said. “By cutting the costs of doing business, rolling back red tape, and promoting products through Taste NY, we are seeing monumental success across the state. When these craft beverage producers do well, it creates jobs, puts more money in local economies and sets the stage for future growth.”

The report, prepared by Stonebridge Research Group, found significant growth in the craft beer industry since the 2012 passage of New York Farm Brewery legislation. The number of craft breweries has more than doubled from 2012 to 2015, from 95 breweries in 2012 to 207 in January 2015. Craft beer production was up 54% from 2011 to 2013, to 859,535 barrels

The craft beer industry is creating significant ripples in the state’s economy. Craft beer accounts for 6,552 direct industry jobs, according to the report, while supporting another 4,814 jobs in related industries. It is responsible for more than $2.9 billion in direct and indirect revenue within the state, and another $554 million in direct and indirect wages, making up the nearly $3.5 billion in total economic impact on the state.

Tourists and New York residents alike are flocking to craft breweries and brewpubs. Their visits support more than 3,000 jobs that pay more than $77 million in annual wages and generate more than $450 million in revenue, the report stated.

HVEDC’s Gates said that the organization’s Food and Beverage Alliance was established more than three years ago and brings organizations within the food and beverage industries together, helping area businesses forge strong partnerships. Its members include restaurants, distributors, distillers, brewers, wineries, box manufacturing companies, etc. The alliance, which started with approximately 20 founding members, has grown to a membership of more than 70 companies today.

The number of people employed by food and beverage concerns in the Hudson Valley from 2010 to 2013 grew by nearly 15% to more than 55,000 employees working for more than 5,000 businesses.

Gates, who worked for 25 years for Bacardi before joining HVEDC, said that craft brewers, such as Newburgh Brewing Co. and others, redeveloped long-abandoned industrial brick sites and successfully converted them to successful brewery/pub/restaurants. He said that the craft brewing industry is definitely a source of growth for the Hudson Valley economy. At present there are about 12 breweries in operation in the Hudson Valley with more in the pipeline.

While the craft brewers focus on their own success, there is also a kindred spirit for the fledgling industry itself to grow. He said a lot of the breweries and distilleries engage in what he calls “co-opertition.” Gates related, “In the business they do compete with each other, but they also want to see the industry grow which is why they work closely together when a new brewery and distillery opens up,” he noted.

John Jordan
Editor, Real Estate In-Depth