Graft Beer: Pay-to-Play Infects Chicago Beer Market
The Wit Hotel in the Loop is a trendy hangout for the after-work and weekend crowd. Clubbers dressed to the nines party year-round on its 7,000-square-foot rooftop and, 27 stories below, in the State & Lake bar off the lobby.
The boutique hotel also is on the front line of Chicago's brutal—and at times illicit—battle over beer.
When the Wit opened in 2009, bar managers stocked State & Lake's 16 taps with an impressive selection of microbrews, including Stone, Anderson Valley, Two Brothers and Metropolitan, a new hometown brand.
Then, in June, most of the craft beers from smaller distributors disappeared,, replaced by 11 specialty brands carried by Chicago Beverage Systems LLC, a powerhouse distributor of Miller, Coors and other labels.
"We don't know exactly what went down, but we used to have beer there that was selling well and now we don't," Tracy Hurst, co-owner of Metropolitan Brewing, a microbrewery in Ravenswood, said at the time.
Undercurrent in Beer War
What went down at the Wit is but one example of the fierce, behind-the-scenes struggle for dominance in Chicago's $500-million-a-year beer market. The city is one of the last contested territories for the nation's two beer giants—Anheuser-Busch InBev N.V. and MillerCoors LLC, an affiliate of SABMiller PLC—which wage a proxy war through licensed distributors. The major wholesalers are movers and shakers themselves: the billionaire Reyes family; Yusef and Jonathan Jackson, sons of the Rev. Jesse Jackson; and, as of September, Warren Buffett's "favorite banker," Byron Trott...CLICK HERE TO READ THE FULL STORY.