By Neil Kenworthy
Baltimore Watchdog Staff Writer
With the final additions being placed on a new distillery in Port Covington, Sagamore Spirit is aiming to begin working on its equipment by the start of the new year.
The rye whiskey company, founded by Under Armour CEO Kevin Plank, hopes to welcome visitors to its’ five-acre East Cromwell Street complex by spring 2017, according to the company’s president, Brian Treacy.
“As far as we’re concerned we are very excited to be situated in downtown Baltimore,” Treacy said.
Sagamore Spirit’s distillery will be one of the newest complexes to open in Port Covington, a former railyard and industrial area located on the middle branch of the Patapsco River in south Baltimore.
Beginning in 2012 Sagamore Development Co., also owned by Plank, purchased 160 acres of waterfront properties on the peninsula for $114 million.
Construction of the three-building distillery began in October 2015. It will be a part of the East Waterfront district in Port Covington that also features three tasting rooms situated on the waterfront.
Over the next two decades Sagamore Development has proposed a plan to radically redesign Port Covington with homes, offices, parks, restaurants and a global headquarters for Under Armour.
Sagamore Spirit’s distillery is part of phase one of the Port Covington master plan. In addition to the distillery, City Garage, a 133,000-square-foot innovation hub, opened in October 2015. A bike path is also being constructed as part of phase one of the project.
While Plank’s Sagamore Development Co. owns 160 acres of the project, the master plan includes 260 acres of total space.
Rye whiskey distilling began in Maryland towards the end of the 18th century. The state quickly became one of the largest pre-prohibition producers of rye whiskey due to a unique Maryland flavor, according to Treacy.
The height of production for Maryland rye was 1936. According to a report from the Baltimore Sun, Maryland led the nation in rye whiskey production with 14 million gallons.
To capture this unique flavor, Sagamore Spirit hired a 10-person team that included Larry Ebersold, a master distiller and former Seagram’s employee, according to Sagamore Spirit.
Sagamore Spirit began distilling four years ago in Indiana. Barrels were then brought to Sagamore farm, located 22 miles away from the new distillery in Reisterstown, where the rye whiskey is proofed using a natural limestone aquifer.
The limestone water is an important part of the production process because it is iron-free, Tracey said.
The rye whiskey is then aged in charred American oak barrels for three to four years before being bottled in Maryland.
“We are not worried about an age statement,” Tracey said. “Our main concern is the taste profile.”
Tracey categorizes Sagamore Spirit’s rye whiskey on the side of more traditional Maryland ryes making it more sweet than peppery.
After proper aging and taste requirements were made, Sagamore Spirit’s rye whiskey hit the shelves of liquor stores and bars in May.
Sagamore Spirit’s current market extends from Maryland through the District of Columbia, Delaware, Virginia, New Jersey and New York. While the exact number of placements is hard to calculate, Tracey estimates there are well over 2,000 different locations just in Maryland, the District and New York areas.
The quick growth of Sagamore Spirit’s market coincides with what Fortune calls “rye whiskey’s comeback in American bars.”
According to its report, rye whiskey’s volume increased 536 percent between 2009 and 2014. This sharp increase in popularity led to about $300 million in annual rye whiskey retail sales over that time, Fortune reported.
To be classified as rye whiskey the final product must contain at least 51 percent rye. This differentiates itself from other whiskeys, such as bourbon, which must contain at least 51 percent corn, according federal laws and restrictions.
Sagamore Spirit has yet to rule out producing other spirits, according to the Baltimore Sun. Right now, however, the company is focused on perfecting the quality of its rye whiskey before going down any other paths, Treacy said.
In total the Port Covington redesign is about a $5.5 billion project. Sagamore Development has already requested $1.1 billion from local, state and federal governments for the infrastructure needed for the project.
This includes $535 million in tax-increment financing, also known as a TIF, from Baltimore City. A TIF takes money from municipal bonds and is repaid through property taxes generated by the project.
Sagamore Development’s TIF deal is the largest ever seen in Baltimore and ranks among the highest in the country, the Baltimore Sun has reported.
Sagamore Development presented its’ master plan to the Urban Design and Architectural Review Panel on May 26. Its top urban design goal is to create both a sense of arrival as well as making Port Covington a destination.
“Folks throughout the industry have been very good to us, it’s an honor to be a part of Baltimore,” Treacy said. “We’ll work hard every day to make sure we’ve earned that.”