Dogfish Head expansion moves forward

Superstorm Sandy wrecked havoc along the East Coast, inflicting unprecedented damage on the New Jersey and New York shorelines. Delaware avoided major problems, but projects like Dogfish Head Brewery's expansion have been delayed by the storm.

Owner Sam Calagione said the hurricane pushed back the brewery's timeline to complete an expansion and a new warehouse. All three concurrent projects should now be constructed by May 2013. Equipment installation and commissioning will be completed two to three months later.

In a project of this scale, Calagione said, timing is everything.

“It's an incredibly intricate and complex undertaking,” he said. “We're basically doubling our under-roof square footage. While that's just the physical expansion, the more intricate component is actually the timing and arrival and installation of the equipment that goes in these spaces.”

Michael Glick, senior project manager with Lighthouse Construction, said he is working with the brewery to absorb the lost time and maintain equipment delivery dates.

Dogfish has about 110,000 square feet to work with now. When the expansion project is complete, Calagione said, the brewery will be about 220,000 square feet. The new warehouse was approved for 100,000 square feet, with about 80,000 square feet now under construction and the rest reserved for future growth. A 28,000-square-foot addition is being built to the current facility to house grain and hop storage. And a portion of the building's roof was raised from 24 feet to 48 feet to accommodate a new brewhouse.

The extra room is needed in order for Dogfish to continue growing as a business. Calagione said the brewery is already working near capacity. New equipment and more space, he said, will give Dogfish a brewing capacity of about 600,000 barrels annually. Dogfish will produce about 171,000 barrels this year and has budgeted for 202,000 in 2013. It should take 10 to 15 years to reach 600,000 barrels, he said.

Two key components are being constructed in Germany – a high-speed bottling line for the new warehouse and a 200-barrel brewhouse to complement a 100-barrel brewhouse already in place. Dogfish had to buy new equipment because it is reaching a size only a few breweries in the U.S. nearing.

“We're on a scale now with about 10 or 12 breweries roughly our size that are all growing strong,” he said. “There is no more used equipment at this scale. Unfortunately, everything we buy has to be bought new. And we don't skimp on our investments and equipment, so that means [we buy] world-class equipment.”

The best bottling lines and brewing equipment come from Germany, he said, so brewery officials made the decision to buy from a company located outside the U.S. Nearly everything else, Calagione said, is purchased locally or from American vendors. Dogfish's barley and hops are bought from companies in Oregon and Washington, and many ingredients come from Delaware-based businesses like Fifer Orchards and TS Smith.

Calagione said much of the credit for the project's timing goes to Chief Operating Officer Nick Benz and Brewmaster Tim Hawn, who have worked extensively to ensure the pieces of the puzzle fall into place in the proper order.

The plan, Benz said, is to have the entire process start at one end of the campus and finish at the other. The expanded brewery will have a commercial entrance connecting to Cave Neck Road, where all trucks dropping off supplies or picking up finished products will enter and exit. A gated guard booth will allow trucks into the facility only during regular business hours. Some trucks will still visit the current building, but they will enter and exit the Dogfish campus via the new commercial roadway.

Another set of gates will be located on either end of a bridge that crosses Round Pole Branch between the new warehouse and the current facility. The road will be used by trucks delivering supplies to the existing building as well as employees going back and forth and visitors on guided tours. Gates will open only to employees with special security cards, Benz said.

The new equipment is expected to be up and running by the end of summer 2013, Calagione said, making 2014 the first full year the renovations will make an impact on the business.