CO-HOP Brewery Model
The CO-HOP brewery model is based on investing in highly productive fixed assets in attractive urban markets. While each location will reflect the unique characteristics of the market and neighborhood in which the site is located, the typical CO-HOP brewery will share many common features and amenities. Our team plans to target underutilized or vacant industrial properties in dense urban neighborhoods — transforming the physical structure and catalyzing the surrounding community.
The CO-HOP concept was created to address critical pain points faced by new entrants in the expanding craft beer market. Brewing in a CO-HOP cooperative brewery setting removes highly dilutive capital requirements, low margins, and other hurdles commonly faced in scaling a craft beer brand. An aligned incen-tive structure motivates on-site sales through a high foot traffic taproom and retail storefront. A flexible operating arrangement and variable cost structure allows tenant brewers to quickly adjust to changes in customer demand. Partnering with tenant brewers, the CO-HOP helps craft brewers build their brand and catalyze their sales potential.
Growing at annual rate of 10.9% over the past decade, the unparalleled expansion of the craft beer industry presents numerous opportunities for innovation. the CO-HOP is a location-centric business model with an initial site planned for the Wicker Park neighborhood of Chicago. Our team is in the process of gathering tenant LOIs, securing a location and contractor to develop the brewery, and gaining legal and community approval for the concept. We anticipate to close on a prospective property and complete equity fundraising for the CO-HOP Chicago in July 2014. After successful completion of the first location, the CO-HOP team envisions opening subsequent locations in regions and markets under indexed in craft and microbreweries. the CO-HOP represents an innovative business mod-el with the potential to accelerate the evolution of the domestic beer industry.
Solving Brewer Pain Points
The CO-HOP is a cooperative brewing business model that aims to solve critical pain points facing start-up brewers and growing regional players as they seek to grow their craft beer brands. The side effect of a highly regulated and capital intensive industry, these pain points restrict new market entrants and prevent existing operators from reaching their full potential. the CO-HOP is a fully-equipped brewing, taproom, and retail facility that provides tenant brewers many advantages over traditional scaling options — helping these tenants build their brands and catalyze their sales potential.
The management team of the CO-HOP is comprised of four Kellogg School of Management graduate students at Northwestern University. Our team brings a diversity of skills across project management, consulting, investment banking, financial services, and real estate investing. All team members are committed to pursuing this opportunity following graduation in June 2014. Our team has selected Chicago as the preliminary location for the CO-HOP and is currently engaged in gathering LOIs from perspective tenants, securing a building and contractor to develop the concept, and gaining legal and community approval for the proposal.