Friday, July 8, 2011

Michter’s To Build Micro-Distillery On Louisville’s Whiskey Row.

Louisville’s newspaper, the Courier-Journal, reported Wednesday that Michter’s Distillery (i.e., Chatham Imports) will invest $7.8 million to renovate the historic Fort Nelson Building at Eighth and Main streets, and establish Louisville's first downtown distillery since before Prohibition.

The big announcement brought out the governor, Steve Beshear; Louisville Mayor Greg Fischer; and the president of Louisville’s Chamber of Commerce, all of whom spoke, along with Chatham president Joe Magliocco.

The site is across Main Street from the Louisville Slugger Museum. Public tours and tastings are scheduled to start in spring of 2013.

Louisville’s Main Street was ‘Whiskey Row’ during the Kentucky whiskey industry’s 19th century heyday. Dozens of companies had offices, warehouses, and rectification facilities there, primarily because it was adjacent to the Ohio River waterfront.

Heaven Hill wasn’t there then but they have had their Louisville offices on Whiskey Row for many years. Louisville-based Brown-Forman, founded in 1870, now has a building there too. Members of the Brown family have privately been leaders in the preservation and redevelopment of the old Whiskey Row district.

The street is architecturally-significant as it has the largest concentration of 19th century cast-iron facades outside of New York City.

It’s a nice, attractive part of downtown with a real feel for Louisville’s history.

For several years, Lincoln Henderson’s Louisville Distilling Company (Angel’s Envy Bourbon) has talked about opening a micro-distillery on Main Street. It hasn’t happened. In this case, too, I'll believe it when I see it. Right now it’s just a ‘plan.’ No details were given.

Assuming it does happen, this is smart strategically for Chatham. This has been a fairly obvious idea, just sitting there, for one of the non-distiller producers to adopt. The idea is to use a micro-distillery to create a ‘home place’ for a non-distiller brand. That’s marketing jargon for a physical location fans of a brand can visit, thereby deepening their relationship with the brand. Brands that have picturesque distilleries, such as Jack Daniel’s, Maker’s Mark, and Woodford Reserve, have that built in. A brand like Michter’s has to create it.

Louisville’s Whiskey Row is not only perfect historically, it also happens to be near many of Louisville’s most popular tourism attractions.

There are several other brands, most notably Diageo’s Bulleit, that should have done something like this but Chatham beat them to it. Good for them.

Something similar was done once before, by Michter’s. In 1976, they installed a micro-distillery at the distillery in Schaefferstown, Pennsylvania. It was capable of producing one barrel of whiskey per day. It would demonstrate the distilling process to visitors when the big distillery was shut down, which in those dark days it usually was.

That original Michter’s micro-distillery also made news recently, although no big politicians showed up. I told you about that here.

Michter’s participated in the KBF Sampler in Bardstown for the first time this past April, signaling that they intended to establish a Kentucky presence. There they told people that they “moved to Kentucky from Pennsylvania in 1989.” So they still have a lot of the phony-baloney going. That doesn’t change the fact that this is a smart and bold move, and so far they’ve played it well.

Michter’s doesn’t have a distillery but it has a distiller, Willie Pratt, who had a previous association with Brown-Forman. He also participated in Wednesday’s announcement.

The only connection between the current Michter's and the original is the name, which Chatham Imports acquired a few years ago. Chatham is one of those small, non-distiller producers that markets a number of specialized brands. If the main photo on their web site home page is any indication, Michter’s has become their flagship.

Chatham is small but they know the business. They were smart enough to recognize how much the Michter’s name was worth and now they are willing to invest to develop its full potential.

Since reviving the Michter’s brand (not in 1989, 1999 more like it) Chatham has worked with Kentucky Bourbon Distillers (KBD) of Bardstown as their whiskey broker, bottler, and DBA. No one at Chatham, nor at KBD, has any connection to the distillery in Schaefferstown.

KBD doesn’t distill either. Heaven Hill is always assumed to be the source of KBD’s whiskey. KBD gets a lot of whiskey from Heaven Hill, which is located right across the street, but KBD’s whiskey comes from other sources as well. People who have been in their warehouses recently report seeing barrels from Barton, Brown-Forman, and other producers.

Chatham doesn’t treat Michter’s like a mere brand name. They foster the illusion that it is a real distillery with roots in the 18th century. Here is the real history.

Michter’s is a brand name created in 1950 by a guy named Lou Forman. He combined the first names of his two sons, Michael and Peter, to come up with something that sounded vaguely Pennsylvania Dutch, which was appropriate for a distillery in Schaefferstown, Pennsylvania.

For most of its history the distillery there was called Bombergers, after the family that owned it from 1861 until Prohibition closed it. Forman bought it in 1950 and renamed it Michter’s. He sold it in 1956 and the name was changed to Pennco Distillers. Forman bought it back in 1975 and it was known as Michter’s thereafter, until it closed for good in 1990.

When Chatham executives (or doting Louisville officials) talk about the whiskey given to Washington’s soldiers at Valley Forge, they’re talking about whiskey made at Johann Shenk’s distillery, which was founded on the Schaefferstown site in 1753.

Today the distillery site in Schaefferstown is in ruins.

Why is there so much interest in a little Pennsylvania distillery that has been dead for more than 20 years? So much interest that the mere name seems to have magic in it?

First, it had a genuinely rich heritage, which it exploited through heavy promotion of tourism during the last ten years of its existence. Also during that period it did a big business in collectible decanters. So a lot of people knew about the place.

Second, the master distiller there for many years was Everett Beam, of Kentucky’s legendary whiskey-making Beams.

Third, one of the most lionized bourbons of the last 20 years, A. H. Hirsch Reserve, was whiskey made there in 1974.

None of this, of course, has anything to do with today’s Michter’s.

From a production standpoint, the micro-distillery is a gimmick. If they ever use any of the whiskey made there in the mainstream product, it will be a long time in the future and a drop in the bucket. The main thing is that Michter's will have a home place in Kentucky, a valuable marketing asset.

Presumably, since they were able to trot out all of the big dogs for the announcement event, this plan is more than talk. So despite my reservations, especially about the way they continue to play fast and loose with historical facts, I commend Chatham for this move. It’s a bet on bourbon, and I’m all for that.


SK said...

I heard they will open the new micro distillery in july 2013.

Chuck Cowdery said...

They won't, not even close. They've barely started.

Scott said...

hey chuck, any idea where Hirsch Kentucky straight bourbon is distilled?

Chuck Cowdery said...

None. Ask them.