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Friday, 11 December 2015 13:17

Pilot Malt House plans $1 million expansion in Virginia

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Pilot Malt House owner Erik May leads a tour of the Byron Center facility earlier this year. Pilot Malt House owner Erik May leads a tour of the Byron Center facility earlier this year. MIBIZ FILE PHOTO: JOE BOOMGAARD

 BYRON CENTER — Erik May, the owner of Pilot Malt House LLC, had always envisioned expanding his West Michigan-based craft beverage supply chain business to other markets.

A few months ago, not even May would have expected that expansion to be announced this year.

“In the life cycle of a company, you want to wait to really nail down everything you do, and we’re still learning,” he said of the company’s operation on 100th Street in Byron Center that supplies malted grains to craft breweries and distilleries across Michigan. “But we got to point where we realized that we’ll always be learning. We can’t wait until we know everything or it will be too late.”

On Thursday, Virginia Gov. Terry McAuliffe, Virginia Secretary of Agriculture and Forestry Todd Haymore and other local officials joined May on stage in announcing the $1 million expansion of Pilot Malt to Lucketts, Va. The processor plans to hire seven people to run Pilot Malt Virginia LLC, which will buy more than 2 million pounds of barley, wheat and rye from farms in Virginia and Maryland over the next three years.

For May, the announcement served as the culmination of a process that started in April at the 2015 Craft Brewers Conference in Portland, Ore. While attending the conference, May was introduced to Haymore, who outlined the “aggressive incentives” the Commonwealth of Virginia would be willing to offer his company if it opened a satellite location in the state. [Editor’s note: May first described the incentives during a craft beverage roundtable MiBiz held in July.]

“They have some really pro-business ideas,” May said of the Virginia government.

In the meantime, he got connected to the owner of Black Hops Farms, the site of Virginia’s only hop-processing plant and home to its own craft brewery, who wanted to have an on-site malting operation there as well.

Additionally, Haymore kept up his recruiting efforts and sweetened the deal with state incentives.

“There’s this whole little enclave there,” May said. “This was just too unique an opportunity to pass up.”

The state and local governments offered Pilot Malt a 12-year tax abatement for the project, and the state also is committing nearly $20,000 through the Virginia Department of Agriculture and Consumer Services’ Agriculture and Forestry Industries Development Fund, which will be matched by the local Loudoun County.

“Pilot Malt House’s investment also enhances the Commonwealth’s position in the industry, which has an economic impact of nearly $625 million, by providing a new market for Virginia’s grain producers and a new supply of locally grown and processed malt for Virginia’s craft beverage industry,” Haymore said in a statement.

May, who will remain in Michigan, said he wants to set up the Virginia operations to run as autonomously as possible, although the satellite will lean on the Byron Center facility for its lab and other resources.

The brand-new Lucketts facility will be situated about 18 miles from Frederick, Md.-based Flying Dog Brewery and 135 miles from San Diego-based Stone Brewing Co.’s new $74 million east coast satellite brewery that is projected to employ 288 people.

“They make good bookends for us,” May said. “Virginia has a booming beer market like Michigan, but it doesn’t get the press … and the government has been very supportive.”

Virginia had 78 craft breweries and produced nearly 196,000 barrels of craft beer in 2014, according to the Brewers Association, a Denver, Colo.-based industry group.

“It was really the perfect storm, and we realized we couldn’t really wait until we could look in mirror and know we’re ready. This opportunity would have passed. It would have been someone else,” May said. 

Read 5049 times Last modified on Wednesday, 16 December 2015 00:01

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