GILFORD — Millennials are imbibing more liquor than recent generations, and the number of small distilleries has boomed in response.
In the Lakes Region, the Gilford Planning Board granted conditional site plan approval on July 15 for Mount Washington Distillers LLC to break ground on a new building on a 2.68-acre site at 270 Hounsell Ave., in the Lakes Business Park.
The surge in interest for independently produced whisky, gin, vodka and other spirits appears to be an outgrowth of consumer demand for locally made beverages, such as craft beer and wine and spurred by the strong interest in buying local, including the farm to table movement that’s connected to a foodie culture.
Millennials comprise 32 percent of U.S. spirits consumption by value, according to L.E.K. Consulting, a global management consulting firm.
“Craft spirits are the next big thing,” the firm said in a 2018 report.
In Gilford, Wadsworth Property Management LLC., plans to construct a 9,920-square-foot building in two phases to house a complex, four-column automated distillery. A 45-foot-tall, 40-by-40-foot building — totaling about 1,600 square feet with a loading dock — will provide the needed space to make vodka, gin and “moonshine,” in phase I.
By 2025 the business plan calls for phase II to include the construction of an 8,300-square-foot addition for barrel storage to age distilled bourbon. The new space will include a 1,000-square-foot tasting room and a 500- square-foot deck, allowing for retail sales. Tasting room guests will be limited to consuming a 2-ounce sample, by state regulations.
Company principal David Wadsworth told the planning board he selected the site because of the quality of Laconia’s water. Testing showed it has low levels of calcium, potassium and iron, which can each impart a foul taste, odor or color to water, which is the key ingredient in distilling.
The proof of the water quality, he said, is best demonstrated by a 25-year-old tea kettle at his mother’s Morningside Drive home in Laconia, which shows no traces of white caking caused by calcium despite its age.
“It tastes good and is part of the Mount Washington watershed. I want to capitalize on it as 80 percent of a spirit is the water,” Wadsworth said.
A chemical engineer who spent 14 years working for Exxon and 26 years working for Chevron, Wadsworth eyes creating a distillery and running it as his retirement project, said Jim Stafford, of Stafford Construction, who is the general contractor.
The proposed building site for the distillery is owned by the town of Gilford, but Wadsworth said he expects to close on the purchase on Aug. 22.
Land clearing will begin in mid-September followed by the installation of the foundation. He hopes to have the building fully enclosed by Christmas so work inside can continue over the winter.
Operations will likely begin in the summer of 2020 after the final approvals from the Bureau of Alcohol, Tobacco and Firearms and the state are obtained.
The distillery will produce about 2,000 cases a month and will start with three employees including Wadsworth, and will eventually expand to a maximum of 10 workers.
The distillery will be open Monday-Friday, 8 a.m. to 5 p.m.
The business will initially distill vodka, gin and “moonshine,” which Wadsworth described as a minimally processed corn liquor that is especially popular in the south.
Ingredients that will be trucked in most in 2,000-pound bags on pallets include granulated sugar, corn, rye, malted barley and juniper berries sourced from Maryland and New Jersey.
Two pounds of yeast is added for every 2,000 pounds of sugar, and the mixture is filtered and then allowed to ferment for three to 10 days.
Modern waste water management practices will be used with separate drains for water materials and alcohol. Native fruits like blueberries and apples may also be used to create unusual offerings that can help an artisan distiller shine.
In response to questions by the planning board, Wadsworth said, the operation will not produce any objectionable odors.
“Basically, what does come off is carbon dioxide. You could grow some nice tomatoes with it,” he said.
Following a year-long process, Wadsworth, who now holds the 13th distillery license issued in the state, said most operations use a pot-style still that he finds “not particularly interesting.”
He plans on installing a four-column complex automated distillery in which each column can be directed to feed others, sending different blends to individual pots through a series of tubes akin to the Fizzy Lofting Drinks room of Willy Wonka fame.
Planning Board approval was conditioned on the proposal getting a green light from the Lakes Business Park Commission and obtaining other needed local, state and federal permits.
Federal regulations require that entry to the site be gated and locked when the business is closed.
The city of Laconia launched phase I of the Lakes Business Park at Hounsell Avenue in the mid-1990s with five lots, four of which have been developed.
In 2002, the city partnered with neighboring Gilford to develop phase II, which consists of 113-acres, divided into 19 lots. The park is served by municipal utilities including natural gas and is an approved economic revitalization zone eligible for tax credits.
In February, the Distilled Spirits Council reported at its annual economic briefing that 2018 marked the ninth straight year of record spirit sales and volumes, reflecting continued market share gains.
Supplier sales were up more than 5.1 percent, rising $1.3 billion to a total of $27.5 billion, while volume rose 2.2 percent to 231 million cases, up 5.0 million cases from the prior year.
In 2018, spirits gained market share versus beer and wine with sales rising seven-tenths of a point to 37.4 percent of the total beverage alcohol market.
It is the ninth straight year of market share gains overall, where each point of market share is worth $740 million in supplier sales revenue.
“These robust results show adult consumers are continuing to favor spirits over beer and wine, particularly among millennials,” said Distilled Spirits Council President and Chief Executive Officer Chris Swonger. “The spirits sector is benefiting from millennials who demand diverse and authentic experiences, and desire innovative and higher-end products.”
“The spirits sector has seen impressive growth driven by innovative products, the revival of cocktail culture and a fascination with premiumization across all spirits categories,” said Council Chief Economist David Ozgo.