Under Armour CEO Kevin Plank said Wednesday that he hopes the new whiskey distillery he's building in South Baltimore will jump-start the transformation of the area, where he has amassed hundreds of acres in recent years.
The Sagamore Spirit distillery, a four-building complex being built on East Cromwell Street, is expected to draw about 100,000 visitors annually for tours and tastings once it opens in 2016. The project marks the first new buildings to be constructed on Plank's Port Covington properties, a former rail yard where officials have long hoped to see economic development.
"Port Covington was this old industrial land, and the idea was, how do we make it cool? How do we make coming over here a great thing?" Plank said Wednesday at the distillery's ceremonial groundbreaking. "What better than whiskey?"
Plank, who has spent more than $100 million in the last 31/2 years assembling more than 200 acres in South Baltimore, plans to build a new campus for Under Armour in the area, as well as create other mixed-use projects.
Two building renovations are already underway, and glimpses of future plans suggest a mix of buildings and waterfront parks with other improvements that would mark a major transformation.
When Plank broached the idea of building a distillery in Port Covington, Mayor Stephanie Rawlings-Blake said she thought he was crazy.
But by Wednesday, when she joined Plank and dozens of other state and local politicians at the groundbreaking, she had come around.
"There's a fine line between nuts and genius, and you're teetering on that genius because you're doing amazing, amazing work," Rawlings-Blake said. "I want to acknowledge you ... for your vision and your tenacity to believe that something like this is possible."
The distillery complex, located at 301 E. Cromwell St., not far from the cruise ship terminal, is to include a restaurant and event space, a 22,000-square-foot distillery, a 27,000-square-foot processing center and a 120-foot-high water tower, holding water brought from Plank's Sagamore Farm, a horse breeding facility in Baltimore County.
Details on the whiskey operation itself were scarce.
Sagamore representatives declined to say how much it is costing to get the 5-acre project up and running, how many bottles they plan to produce a year or how many people they expect to employ. Construction is expected to create about 600 jobs.
Industry observers said they expect the company to start as one of the bigger "craft" distillers, but they believe Plank and co-founder Bill McDermond — a teenage friend who previously worked at Under Armour — have sizable ambitions. Already, the 10-person Sagamore Spirit team includes a former distillery manager for Seagram's.
"I know he wants to be a big company," said Dave Pickerell, a master distiller and senior engineer at the Oak View Spirits consulting firm who works with distillery startups and spoke to Plank during Sagamore's early planning days. "He didn't get into the business to do something small."
The first bottles of Sagamore Spirit — an 83-proof rye — are expected to hit shelves next year after several years of aging. The brand is designed to evoke and resuscitate Maryland's tradition of rye production.
The launch coincides with a resurgence in rye's popularity. Production has grown more than 500 percent since 2009, to about 561,000 cases last year, or about $300 million in retail sales, according to a recent analysis by the Distilled Spirits Council.
The number of small distillers is growing too. There are just under 800 in the country today, though they remain a small percentage of the spirits market — just 2 percent of overall sales last year, according to the American Craft Spirits Association.
The growth is creating lots of competition for big and small players, said Alexandra Sklansky, a spokeswoman for the American Craft Spirits Association.
"It will be interesting over the course of the next 10 years," she said. "I think we will see continued growth, but I think some of the craft distilleries that have emerged won't stick around. ... At the end of the day, there's only so much shelf space available at the liquor store."
Maryland is home to about 17 distillers, according to a federal directory, including at least two others in Baltimore.
"We're excited that Kevin Plank is getting into the business," said Max Lents, CEO of the Baltimore Whiskey Company, which expects to start operations at its Sisson Street location next week. "There's more than enough room for everybody at this point. … And somebody with his sort of publicity power bringing attention to Maryland spirits is going to be good for all of us little guys."