Surly breaks ground on $20M destination brewery in Minneapolis

On Tuesday, about 100 members of the Surly Nation — those enthusiasts of the popular local craft beer — gathered for a groundbreaking near a pile of rubble and hoisted pints in celebration of Surly Brewing Co.'s unusual site for expansion.

The Brooklyn Center-based company plans to build a $20 million-plus "destination brewery" for the 8.3-acre environmentally challenged property, once home to a potato processing factory.

Initial development calls for a brewery expansion that will help Surly increase annual production of its signature brews — Furious, Bender, Coffee Bender, Cynic and Hell — and seasonal selections by almost four times to 100,000 gallons. A second phase will involve erecting a 300-person beer hall and garden, a full-service restaurant and an event center. Construction is expected to be completed by late 2014.

The property at 520 Malcolm Av. SE. in Minneapolis is tucked near a stretch of abandoned grain silos and railroad tracks, but close to the Central Corridor light-rail line, TCF Bank Stadium and the University of Minnesota Transitway.

Surly looked at more than 80 potential locations in 30 cities around the metro area, and they were wooed mightily along the way. But company officials said they liked the "Malcolm Midway" spot best because it has ample room for the brewery's infrastructure, and because it's close to public transit and bike trails. A small portion of the site, which was purchased for $1.8 million in April, even dips into St. Paul.

Privately held Surly, which declined to release its annual revenue, received about $2 million in grants from the state, Hennepin County and the Metropolitan Council to clean up the site. The company currently employs about 26 people, a head count that is expected to increase to more than 150 with the expansion.

"The Surly way is not the easy way," Omar Ansari, the company's founder and president, said at Tuesday's ceremony, joking that the site at this time "is more rough than diamond."

Gov. Mark Dayton signed the "Surly bill" in May of that year, and since then, 15 other taprooms have opened statewide, according to Clint Roberts, executive director of the Minnesota Craft Brewers Guild. Recently the Fulton and Indeed breweries announced expansions, as well.

The new Surly site, with its design inspired by a beer garden in Salzburg, Austria, will also focus on food, Ansari noted. "We don't want food to be an afterthought," he said. The company is consulting with Linda Haug, of the former Café 28 restaurant in Linden Hills, on food-service ideas.

The current Surly brewery in Brooklyn Center will remain as a site to experiment with new types of beer, Ansari said. That plant has sentimental value to Ansari, whose father Naseem (or Nick) immigrated to the United States from Pakistan 50 years ago.

Nick Ansari started an abrasive-metals business called Sparky Abrasives, which was later converted to Surly space in 2005, with the first keg sold the following February.

On Tuesday, Nick Ansari handed a golden shovel to his son — the same spade used to break ground on his own business a half-century ago. "When we started we wanted to brew great beer and hopefully meet payroll," the younger Ansari said. "We had no idea what we started."