As we walked along Dominion Rd towards Churly’s my wife said of the signage “it reminds me of Cheers”.
I laughed. After all, that’s the vibe Andrew and Hannah Childs wanted when they set off on a journey to raise $2 million for Behemoth Brewing‘s crowd-funded brewpub-restaurant.
The bar, opened in early August after a four-month Covid-19 delay, is named Churly’s for the Behemoth mascot.
Churly’s was originally set to open in March but the Covid-19 lockdown and subsequent knock-on delays pushed it back. It opened to the public on Sunday, August 2, after a special shareholders’ opening the day before. Even then the opening was rushed to coincide with Auckland Beer Week and there’s still plenty of work to do including exterior painting.
The hat-tip to Cheers is obvious in the design of the Churly’s signage and while the interior doesn’t have the look of the famous sitcom Boston bar, the vibe is spot on.
Situated in a semi-industrial area in a building formerly occupied by a business that specialised in custom-made vehicle exhaust systems, Churly’s features a brewery, bar, restaurant and butchery. The bar has a lived-in feel thanks to stylish use of recycled wood from the original building. Kegs have been turned into industrial light shades and hand basins while the bathroom walls are plastered in Behemoth labels.
The butchery, included a meat-drying room, brings in the unique skillset of Childs’ wife Hannah, aka A Lady Butcher.
Born and bred in Portland, Childs-Miller is a New York-trained chef and butcher who specialises in cured meats, smallgoods and nose-to-tail eating. The on-site butchery will prepare all the meat for the restaurant – from sausages and burgers to steaks and speciality cuts.
While the restaurant and bar was open (until the Covid-19 V2 lockdown) the brewery will not be commissioned until October as Childs irons out a few kinks in the set-up. He will continue to contract brew at a variety of breweries around New Zealand, including Steam, Deep Creek and 8 Wired.
The new brewery will feature a 2,500L three-vessel brewhouse, eight 5,000L fermenters and three 300L fermenters, all from Alpha Brewing in Nebraska.
It’s the first Alpha Brewing kit to be used in New Zealand and Childs hoped for an annual capacity of around 350,000L. That will be nowhere near Behemoth’s forecast volume this year so they will continue to contract brew much of their core range.
No sooner had Churly’s opened than Auckland’s second lockdown came, and during that time the Childs hosted a virtual annual meeting where they revealed a new crowd-funding would start in November through Snowball Effect.
Behemoth hopes to raise another $1.5 million for a brewery expansion as well as adding additional venues, including suburban venues in Auckland, fillery bars in Wellington and Christchurch and a West Auckland taproom and a barrel-aging facility.
Childs said the second capital raise will allow the brewery to grow capacity by adding more fermentation vessels as well as physically expanding into the next-door property which would become a conditioning and packaging hall.
Originally the brewery was going to be dedicated to smaller volume seasonal beers with the core range continuing to be brewed under contract at Steam and Deep Creek, but Childs now wants to bring some 80 per cent of production in-house including a number of core range beers.
Childs said they would also increase the capacity of their chiller to keep all Auckland-bound stock on site rather than using third parties.
He said the expansion “allows us to control our own destiny”.
“We’re going to be more efficient, more streamlined and increase consistency.”
The second capital raise will be done through Snowball Effect and existing shareholders get first right of refusal on the new shares.
Childs said the new premises in Auckland will be “storefront neighbourhood venues” – with both beer and food supplied from Behemoth’s central Auckland brewery and kitchen.
“Rather than running multiple kitchens we can make the food here and cold-freight it to the smaller venues.”
Childs said having multiple venues was always on the agenda.
“It was always part of our medium-term plan to have more small venues to shore up our route to market, and to make sure we’re pouring beers in environments we can control.
“When we crowd-funded in early 2019 we outlined that we needed $3.5m in capital to activate all the things we wanted to do within our strategy. At that time we raised $2.1m, mainly from retail investors with New Zealand citizenship or residency.
“Additional capital is still required to move to the next phase of our strategy [which] directly provides economies of scale, cost savings and as of right distribution of beers.
“This time we will also open up the offer to our fans overseas, as strong interest has been shown from Australia, Singapore and Hong Kong.”
Of most interest is the decision to look for a barrel-aging facility and taproom in west Auckland, an area Childs said was “under-represented in terms of awesome beer” because of the distribution monopoly held by the two licencing trusts that operate in the area.
The Portage and Waitakere Trusts – collectively known as The Trusts – control the bottle stores and bars in the west Auckland area. They do not allow beer to be sold in supermarkets as happens in the rest of New Zealand. However, production breweries and wineries are outside Trusts control because their Customs-controlled areas licence allows the sale of alcohol on-premise.
“The way we get around the Trusts rules is to have a small brewery out there – around 600 litres – because if you’re manufacturing you’re allowed to serve alcohol so that’s how we get around that,” Childs said.
Behemoth recorded a net loss in the 2020 financial year of $287,455 on revenue of $4.4m. However, in the year to September 2020 they returned a net profit of $457,550 on revenue of $6.5m.