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AMS Brewery

AMS Brewery. Report and Recommendation. Context . 2010: start of idea 2011: feasibility report (positive for a brewpub) Dec. 2012: unclear direction, Brewery committee struck Members: Elin, Phaidra , Kathy, Mike. Context. December Committee started work

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AMS Brewery

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  1. AMS Brewery Report and Recommendation

  2. Context • 2010: start of idea • 2011: feasibility report (positive for a brewpub) • Dec. 2012: unclear direction, Brewery committee struck Members: Elin, Phaidra, Kathy, Mike

  3. Context December • Committee started work • Worked with First Key on new costing for a microbrewery • Worked with management to determine an operational model • Started re-engaging with potential partners

  4. Context January/February • Worked towards more detailed costing • Continued talks with more potential partners: lots of interest • Worked with Michael Kingsmill & BIRD Construction to determine building costs • Finalized costing, potential options, and a final recommendation to council

  5. Challenges • Allocated space not enough for a significant capacity: limits business potential • No room for storage of kegs in the 737 sqft brewery: need to get rid of another commercial tenant Solutions: 4 options!

  6. Options Option I: Obtain space from UBC to build a bigger facility in the OLD SUB Option II: Obtain storage space from UBC and combine with 22 Option III: Build a Brewery in the New SUB, find storage in the New SUB Option IV: Build a brewery in the new Farm Centre (est. 2017)

  7. Options Option I: Obtain space from UBC to build a bigger facility in the OLD SUB Option II: Obtain storage space from UBC and combine with 22 Option III: Build a Brewery in the New SUB, find storage in the New SUB Option IV: Build a brewery in the new Farm Centre (est. 2017)

  8. Option III • Brewery-ready shell: $530,775 • Soft costs (design, etc): $98,300 • Taxes: $44,447 • Total: $637,522

  9. Option III Other costs/opportunity costs: • Rent from 737 sqftbrewing space: $36,850/yr • Rent from 1300 sqft storage space: $65,000/yr • 10yr payback of initial investment: $81,722/yr • Total: $183,572/year (for a limited 1500 hL capacity brewery)

  10. Option IV • Farm currently building a $20 million Farm Centre (completion 2017) • Growing hops and barley • Can use the waste product from a brewery • Also will have aqua farms, etc. • OPPORTUNITY: add a new brewing facility to the Farm Centre

  11. Option IV • Strong interest from the Farm • Sustainable • Cheaper building costs: $350/sqft • Flexible design • Much higher capacity unanimous support from the Brewery Committee & Exec Committee

  12. AMS role • AMS would pay for the construction cost of the brewery (up to $1.1 million) • $275,000 set aside from the Student Spaces Fund over 4 years • Investment recovery from lease to a brewing partner • Agreement with the Farm/UBC on the governance of the facility

  13. AMS Funding?? • Student Spaces Fund will collect: $2,833,608 over next 5 years • Outstanding commitments: • New SUB: $250k • Child Care: $500k • Design office: $400k • Total: $1,150,000 • Investment revenues from saving $275k/year:$114,488

  14. Good Business sense? • Definitely the best of the 4 alternatives • Long term investment: lease/business revenue from a brewery

  15. Challenges • Need UBC (C&CP) approval • Need to negotiate a partnership model with the Farm • Need to coordinate the design of the brewery

  16. Motion • Save up $275k over 4 years (2013/4-2016/7) for a brewery • Select a permanent group to lead the process • 5 members total, 2 permanent • AMS council to make a final decision after the presentation of an agreement

  17. Questions? Thank You

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