A plan to launch an Akasha Newcastle brewery inside The Edwards remains alive despite the Sydney craft beer business going into voluntary administration.
It was announced last week that the Five Dock-based brewery had appointed Henry McKenna of Vincents to restructure the business and deal with creditors.
Akasha is one of NSW's largest independent breweries and in December 2022 they purchased The Edwards as part of their planned expansion beyond their inner-west Sydney base.
Since then Akasha have operated the popular Newcastle West restaurant and bar, which was co-founded by Silverchair bassist Chris Joannou in 2014.
A major part of Akasha's plans for The Edwards was to build a brewery onsite, capable of producing 100,000 litres of beer annually.
Akasha owner and founder, Dave Padden, is confident the brewery will emerge from voluntary administration within six weeks to push ahead with their plans for The Edwards.
"The brewery isn't going anywhere," Padden told the Newcastle Herald on Monday.
"So essentially the answer is 'yes', including a [Newcastle] brewery down the track.
"It might be delayed a bit obviously, but essentially we're a brewery at heart and that's what will continue."
The voluntary administration does not apply to The Edwards or The Barrel Room in Leichhardt, which opened in October 2022.
Padden said opening the brewery at The Edwards by the end of 2024 was "quite achievable".
"We've already got the equipment here, so it's really going to depend on licensing, as it always does," he said.
A development application for the brewery is yet to be lodged with the City of Newcastle.
The craft beer industry nationally is facing serious challenges driven by rising production costs and a downturn in consumer spending, following more than a decade of exponential growth.
In the past three months, Melbourne's Deeds Brewing and Hawkers, Adelaide's Big Shed Brewing and Sydney's Wayward Brewing have entered voluntary administration.
Last week Big Shed announced the brewery would continue trading after a deal was struck with creditors.
"Our costs are up 35 to 40 per cent," Padden said. "Excise tax continues to go up, demand is tailing off a little bit.
"But we haven't been hit too hard on that, we're doing all right, but it's dropped a little bit.
"It's a perfect storm of factors that have hurt us a little bit. We just need to reset."
Shawn Sherlock, owner and head brewer of Newcastle's longest-serving brewpub, FogHorn, stressed his King Street venue was trading well thanks to a loyal customer base, but times were tough for the craft beer industry generally.
"When times are tough and people are reining in their spending on food and beverage, particularly in the craft sector where our beer is a little more expensive than the mainstream product, we can be canaries in the coal mine, so to speak," Sherlock said.
"We're in the frontline of what's happening across the broader sector."
Sherlock said tax reform was needed to align the craft beer sector more closely with the small wine industry and help make them more competitive with the multinational brewers.
Last month the beer excise rose by 30 cents per schooner as part of the automatic bi-yearly rise based on inflation. The excise is calculated on alcohol percentage, meaning drinkers pay higher tax on beers such as IPAs.
Sherlock said craft breweries employ more people per litre of beer produced than the foreign-owned "big two" Lion (Tooheys, XXXX) and CUB (VB, Great Northern).
So the loss of any craft breweries would be felt acutely.
"For those people who'd say, 'craft beer is a luxury item and it grew in good times and it'll lose in bad times', yes there's a grain of truth in that and yes we all got into it knowing that could be the case," he said.
"If you lose us because times wipe us out, not only are you losing an important part of the food and beverage culture these days, you're losing a lot of employment."
