Texas To Get a Winery Incubator

IMG_4440by Andrew Chalk

Readers in the tech. sector will be familiar with the concept of an incubator. It is a physical facility with the infrastructure and mentorship to enable nascent companies to grow. For example, it might provide legal, accounting, Internet hosting and marketing assistance. Incubators emerged  during the iTulip boom of the late 1990s but the concept has endured.

Now comes news of one Texas wine entrepreneur’s plans to open an incubator for incipient Texas wineries. Mike McHenry is managing partner of Wedding Oak Winery in San Saba, on the northwest border of the Texas Hill Country American Viticultural Area (AVA). Despite its short life, the winery opened in June 2012, it has already established a reputation for soundly made, award winning wines under winemaker Penny Adams.  

IMG_2894Mike McHenry in the tasting room as Wedding Oak Winery

With Wedding Oak Winery firmly on its trajectory, McHenry has set his sights broader. When his incubator opens in 2015 he plans to offer a comprehensive menu of services that a startup winery could want. From something as small as a lead to a label designer, to a complete physical facility in the same complex of buildings that Wedding Oak occupies in downtime San Saba.

In broad terms, a startup could source their grapes from Wedding Oak, or provide their own. They could make their own wine at the facility, or have Wedding Oak’s Penny Adams make it. They could use Wedding Oak’s fermentation tanks, or provide their own. They could age the wine there, or at their own facility. Everything is à la carte. This resembles a custom crush facility, the first of which opened in Texas with the path-breaking Texas Custom Wine Works in Brownfield near Lubbock. The difference, says McHenry, is that he will offer retail space for the client to market their product in addition to the production help.

To this end, he has plans to take the end unit on his side of the street (currently leased to the San Saba P.D.) and convert it into a dedicated winery facility with tasting/sales room with restrooms at the front. A production facility, bonded space for wine storage and supply room in the center and, cantilevered on one wall at the back, a studio apartment. The idea being that a startup is likely being created by someone who has not totally quit their “day” job. They are likely to need somewhere to stay every weekend when they come to work on their winery. The total space is around 1922 sq. ft. Out the back is a courtyard extension to the tasting room which comprises an additional 1200 sq. ft. The dedicated facility would go live in the fall of 2015. The tenant is responsible for all federal (TTB) and state (TABC) permitting to operate as a winery. Each occupant would likely stay 2-3 years and then go out to their own facility.

IMG_4441The site of the incubator. Wedding Oak owns the two buildings to the right of the winery storefront and the building at the far end of the block. That would become the retail outlet for a winery tenant

McHenry has studied similar concepts like the Winemakers Studio in Oregon and the extensive skunkworks at Walla Walla airport in Washington and they convinced him of the viability of the concept.

McHenry and his partners are looking for a fledgling winery now, and expect to sign contracts with their first client in the next 90 days. McHenry says he has prospects, but is keeping details close to his chest.

More broadly, I see San Saba as ripe for development along the lines of Walla Walla. Until the recent renaissance began with the restoration of Harry’s Boots, JC Campbell Mercantile, Wedding Oak Winery and other projects, San Saba was a typical de-contented rural Texas town with its share of vacant storefronts. Just as Walla Walla repurposed itself, starting 30 years ago, with the wine industry as the driver (it now has over with over 30 downtown winery tasting rooms, 100 wineries in the AVA and an burgeoning restaurant and accommodation trade), so San Saba could eventually become a quintessential wine town in the Hill Country. It has the advantage over Walla Walla of being less remote (three hours from Dallas, four from Houston, less than two from Austin and two and a half from San Antonio) and wine has tourism synergies with the Pecan industry which is very evident in the area.

For now, McHenry’s plans are as significant a structural development for the Texas wine industry as Texas Custom Wine Works was on its inception in March 2013. It marks a step up the credibility ladder for the Texas wine industry and shows how it is becoming part of the plumbing of the Hill Country economy.

 

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