Fulton Beer to expand in northeast Minneapolis

Fulton Brewing Co., which began brewing beer in a one-car garage just seven years ago, has embarked on a major expansion with plans to open a new production facility in northeast Minneapolis.

In a statement posted on its website, Fulton confirmed that it will begin brewing beer at a 51,000-square-foot facility at 2540 2nd Street NE. in late 2014. Fulton's owners did not respond to phone calls for comment.

The move means Fulton, known for its Sweet Child of Vine and Lonely Blonde varieties, can bring all of its production in-house with initial capacity of 20,000 barrels of annual production. It also permits the brewer to distribute beyond the Twin Cities and expand its seasonal and now-limited lineup of Garage Series beers.

The new site, however, will not feature a taproom — state law limits brewers to only one taproom license. Fulton said it will continue to operate its current taproom in the shadow of Target Field, where it will brew small batches of beer.

That popular 6,000-square-foot location was the city's first taproom after the 2011 passage of the Surly bill by the Minnesota Legislature. Named for another craft brewer, Brooklyn Center-based Surly Brewing Co., the law made it legal for breweries to serve pints of their beer on-site.

Since then, the craft brewing business has exploded in Minnesota, with much of the growth centered in the Twin Cities. When Fulton opened its current taproom in the city's North Loop neighborhood, the space appeared "cavernous," according to its statement. "We even thought we might have to sublease some of the space just to fill it up." But after multiple expansions, "just like that, we ran out of space."

When Fulton moves to northeast Minneapolis, it will join other craft brewers in an area once dominated by Grain Belt beer.

"Minnesota is really a state that appreciates local — food, flavor, culture and beer," he said, noting the boom "has only just begun."

He attributed the taproom craze, which includes Surly's planned $20 million expansion in Minneapolis' Prospect Park neighborhood, to beer drinkers who appreciate the connection to the craft of brewing. "It's the experience that people want."

In Fulton's case, an entity associated with Interstate Partners, a St. Paul-based developer, purchased the 1990s-era building in northeast Minneapolis for $2 million, according to Sherman Malkerson, of the C. Chase Co., who represented the seller.

The building originally housed a soap and detergent business called Grace-Lee Products that was subsequently sold to Ecolab in 1998. In the late 1990s through 2008, the building was home to several businesses that made portable shooting ranges.

Malkerson said his firm put the building on the market in 2009 — at the height of the economic downturn. "We've had several partial tenants and offers," he noted. "It's a beautiful, well-constructed building." The sale closed Aug. 28, he said.