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Rahr Corporation’s Shakopee, Minn., Location to Become World’s Largest Single-Site Malting Facility

Shakopee – The Minnesota Department of Employment and Economic Development awarded $610,000 in Job Creation Fund resources to Rahr Malting Corporation on Friday, helping position the Shakopee-based company to begin its $68 million expansion and addition of 28 full-time employees. One of Minnesota’s longest-standing family businesses, Rahr manufactures malt and distributes ingredients for the brewing and beverage industry worldwide.

Rahr Corporation’s expansion plans include the construction of four new facilities: a malt house, pilot brewery and technical center, maintenance warehouse, and distribution center. New parking, green space, ponding, and other site improvements are also part of the plan. The Job Creation Fund monies will go directly toward the cost of the pilot brewery and technical center, maintenance warehouse, and distribution center. This funding is contingent on Rahr meeting itshiring and investment goals.

  • The addition of a new 115,000-square-foot malt house will add 70,000 metric tons of annual malting capacity, for a total of 460,000 metric tons. This amount is enough to brew 6 billion bottles of the average craft beer or 12 billion 12-ounce cans of the average light beer. Upon project completion, the company’s headquarters in Shakopee will be the largest single-site malting facility in the world.
  • The 20,000-square-foot pilot brewery and technical center will further Rahr’s position as an industry leader in brewing ingredients and improve the company’s understanding of how its products perform in a realistic brewery environment. The first floor will house a pilot brewing and micro-malting center, and the second floor will house an expanded malt quality control lab.
  • The 15,000-square-foot maintenance warehouse will allow for storage of the parts and equipment needed to maintain the malting facility.
  • The 80,000-square-foot warehouse and distribution facility for Brewers Supply Group (a wholly owned subsidiary of Rahr Corporation that supplies premium ingredients to brewers, winemakers and distillers) will primarily be used for warehousing and order fulfillment. About 6,000 square feet will be used for the bagging of malt, ranging from bulk loads down to smaller sizes for craft brewers. The facility will serve Rahr’s brewery customers across the United States, including many of Minnesota’s new craft brewers.

“We’re very excited to be able to continue growing in our home base of Shakopee,” said William Rahr, president and chief executive officer of Rahr Corporation. “This is the first time in our 168-year history that we have asked the state to support our expansion of jobs and production, so we appreciate the state’s recognition of the economic benefits that Rahr’s expansion will bring to Minnesota.”

DEED’s funding approval comes after the Shakopee City Council’s unanimous vote on March 31 to approve Rahr Corporations’ tax increment financing request. Combined, the state and city approvals pave the way for all four components of the expansion in Shakopee, located in the southwest Twin Cities.

Rahr’s new facilities are scheduled to be fully operational by spring 2017 and will result in the addition of 28 new full-time employees at an average wage of $20 per hour.

“Rahr’s Minnesota operations were one of the first modern malt productions in the state, and has since continued to grow here,” said DEED Deputy Commissioner Kevin McKinnon. “We thank the company for its continued investment in the state and for its commitment to bring new jobs to the Shakopee area.”

About DEED and the Job Creation Fund

The Job Creation Fund, which was first proposed by Gov. Mark Dayton in 2013, is a pay-for-performance program that provides funding to businesses after they meet certain criteria, including minimum requirements for job creation and private investments. Under the program, businesses must create at least 10 full-time jobs and invest at least $500,000 to be eligible for financial assistance.

Since the Job Creation Fund was launched in January 2014, DEED has awarded $17.3 million to 32 companies in Minnesota. Those companies have committed to creating 1,854 full-time jobs and plan to invest nearly $359 million to expand.

DEED is the state’s principal economic development agency, promoting business recruitment, expansion and retention, workforce development, international trade and community development. For more details about the agency and services, visit us at http://mn.gov/deed.

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EXPANSION OVERVIEW

  • Rahr Corporation is embarking on a $68 million expansion to meet the craft brewing industry’s growing demand for its products, making it the world’s largest single-site malting facility.
    • Demand for Rahr’s products is expected to grow five to ten percent over the next decade.
  • Rahr’s expansion, scheduled to begin in April 2015 and be fully operational in spring 2017, will create 28 new full-time jobs.
  • The expansion will include the construction of a new malt house, pilot brewery and technical center, maintenance warehouse, and distribution center.
    • Green space, ponding, parking, and other site improvements will also be incorporated.

MALT HOUSE

  • A new 115,000-square-foot malt house will be adjacent to Rahr’s existing malt house, located on a two-acre property north of Third Avenue W and west of Pierce Street S.
  • It will add 70,000 metric tons of malting capacity, for a total of 460,000 metric tons.

PILOT BREWERY AND TECHNICAL CENTER

  • A new 20,000-square-foot facility will be located on a 2.7-acre property south of First Avenue W and west of Apgar Street S.
  • The first floor will house a pilot brewing and micro-malting center, and the second floor will house an expanded malt quality control lab.

MAINTENANCE WAREHOUSE

  • A new 15,000-square-foot warehouse will be located on a 1.2-acre property north of Second Avenue W between Pierce Street S and Shumway Street S.
  • It will allow for storage for the parts needed to maintain the malting facility.

BREWERS SUPPLY GROUP (BSG) WAREHOUSE AND DISTRIBUTION FACILITY

  • A new 80,000-square-foot facility will be located on a roughly 5-acre property north of First Avenue W and surrounded by Brook Lane and Clay Street N, serving brewers of all sizes in Minnesota and across the country.
  • About 6,000 square feet will be used for the bagging of malt, ranging from bulk loads down to smaller sizes for craft brewers, with the remainder used for warehousing and order fulfillment.
  • BSG is a wholly owned subsidiary of Rahr Corporation that supplies craft brewers, winemakers, homebrewers, and distillers with premium ingredients at competitive prices.