Slackwater Brewing building sale scuttles taproom/restaurant but won't impact brands/distribution

When Slackwater Brewing co-founders and co-owners Liam and Kelsey Peyton returned from vacation at the end of September, they got the news.

The cavernous two-storey building that since 2019 had housed the business they'd grown from scratch, a business that had arguably impacted the vibe of downtown Penticton more than any other in the past decade, had been sold.

The sale wasn't hugely surprising. When it opened in June of 2019, Slackwater was instantly the darling of the downtown scene. And it was busy. Modernistic, youthful and absolutely massive, it was a breath of fresh air in a neighbourhood that badly needed it.

But just eight months later, COVID washed ashore. And that wasn't the only issue to hammer Slackwater over the next few years.

By the summer of 2023, Liam and Kelsey and their partners were looking hard at their next move. Though their distribution program throughout the province and in fact much of western Canada was going great guns – 200,000-plus liters per year at last count – their taproom/restaurant was far too empty far too much of the time.

Ultimately, the option that won out was the sale of the building. The couple would continue producing and distributing Slackwater-branded brews into the future. But they wouldn’t be doing it – or anything else – from the space at 218 Martin St.

The Peytons were still choked up earlier this week when we sat down with them at the Slackwater taproom, which goes out with a bang this Saturday in a grand finale they’ve named "la fin."

It's been a heck of a ride.

Back in 2018, Penticton's drink/food/nightlife scene was…scattered. There were pubs and there were restaurants here and there, but there was no focus. No geographical hub. No recognized entertainment zone.

A push to turn north Main Street into that zone never really caught on, and the city's lone night club, a 1990's relic called The Mule, was ready to close for good.

Into this atmosphere rolled the Peytons. Kelsey, from Penticton, and Liam, a native of Britain. The two met in 2013 at Whistler and hit it off right away, sharing their love of skiing, fishing and the great outdoors.

There was one other key commonality. They'd each spent time in the brewing and beer industry. So when the idea of settling in Kelsey's hometown came to fruition, running a brewery was already on their mutual radar.

The only question was where. A pitch to the City for the old "bus barn" on Ellis Street fell through.

And that brought them to 218 Martin, where The Mule was on its last legs. It had electric, it had gas, and it had a liquor license. And it was certainly big enough to accommodate brewing gear.

The Peytons and their team bought The Mule and indeed The Mule's building too even before the club has closed.

Demolition began immediately, in September of 2018. It would take nine months (and one famous name change, from the Peyton's initial fishing-inspired choice of "Hatchery Brewing") for the doors to officially open.

But when they did, Slackwater was an instant smash hit. The place was jammed all summer long.

"Yeah, that first summer was wild," smiled Liam, looking about the venue. "We had some amazing times. We’ve never touched the revenue numbers we did in that first summer.

"And barely a month in, we were doing live music weekly. For free. And then trivia came in the fall. Games, contests, anything to get people in."

The momentum, along with a number of inventive options during that first winter, kept the Slackwater taproom at the top of the heap into the new year.

The company and the name were making waves outside the Okanagan too.

"It wasn't part of the vision to go this big," said Liam of the large space they called home for six years. "And the plan was never to distribute beer across western Canada in our first five years.

"But by the end of our first summer we were shipping beer to Whistler, parts of Vancouver Island and across Vancouver. It was me much of the time, leaving with a vehicle loaded to the nines with as many kegs and cans as we could jam in."

But something else too. Slackwater, and its early success, would form the arguable cornerstone of what would soon become Penticton's first modern-day food & beverage zone.

Wayne & Freda (coffee shop) opened almost simultaneously. Soon, there'd be Black Antler (restaurant), Pizzeria Tratto, Neighbourhood Brewing, Tug's Taphouse's re-birth as The Hub on Martin, Chulo Tapas and more.

It was all with a five-minute walk. It was young and dynamic. And in a city where the sidewalks rolled up way too early, it became a beacon of excitement.

As for being that cornerstone, they’re not taking full credit. Indeed, they both point to Cannery Brewing as a guiding light of sorts.

"The Cannery was the first brewery to come downtown and they've been incredible to us," said Kelsey.

Added Liam, "We had such respect for them that we took Ian Dyck (Cannery co-owner) out to dinner to ask permission that we'd like to start a brewery downtown. And they wrote the nicest letter to city council, from (Ian's mom and Cannery co-founder) Pat."

"And after that, there were several of us all trying to race to the finish line. And we just happened to open earlier than most everyone else. Then we had that one dominant summer."

So what poisoned the scenario? For starters, COVID.

"We had to reinvent our entire operation," said Liam. "Suddenly everyone was wearing masks. The stress was mind-breaking, trying to make sure all members of the staff were complying, the interactions with our suppliers, everything."

But the pandemic tortured virtually every business. And it was far from the final straw for Slackwater.

"It threw a lot of wrenches," said Liam. "But we came out and started canning and getting the beer out and really just keeping the foot to the gas.

"And then we had a couple of pretty good summers in here."

A bigger part of the blame, they admit, are the "mistakes" they made along the way.

"We have made mistakes here," said Liam. "I think the kitchen was one of our biggest. Inconsistencies, highs and lows with offerings, quality, service levels too. And we’ve had a lot of turnover and turmoil in there from the very beginning.

"Not any other huge mistakes – just stuff you throw at the wall that doesn’t stick. We've been in an extremely dynamic market locally and provincially and globally in the last few years and not everything worked."

And they believe they may have pushed a bit too hard to attract a variety of customers.

"If you try to be something to everyone, then you’re nothing to a lot of people," said Liam. "We had regulars who used to come in and then stopped.

"They'd say 'We stopped because every time we'd come in, there's something going on. We just want to drop by for a pint.' We kind of got lost in doing whatever we could."

Kelsey suggested they opened themselves up to too much feedback.

"We've always been open to it and that's not always good," she said, "We've perhaps listened to too many people."

And, added Liam, even minor miscalculations were important.

"It’s a small town and you make a mistake and people probably don’t come back," he said. "There are so many other options now."

Indeed there are. And many of the newest and trendiest are right there in the new food & bevy district Slackwater helped trigger.

"There's at least a dozen more venues now since before the pandemic," said Liam. "Liquor licenses downtown have probably doubled. Maybe a couple thousand new seats whereas the city has only grown by several hundred people.

"There are some great operators and venues in town and the city keeps giving out liquor licenses nilly willy and everybody fights for the bodies that are in town."

Moreover, Slackwater now sits at the very edge of that new district. Much of what's popped up since is a block or more to the west. Perhaps that extra distance became a chasm of sorts.

"By the time it went from one to multiple venues, everything shifted a block over," said Liam. "It's an awesome area with some of the best food and drinks in town, and we're around the corner."

But there were other factors too say the Peytons. Like inflation.

"Discretionary spending is way down," said Liam. "People who were going out three times a week are once a week now. We go out once a month if we're lucky."

And parking and bike lane hassles. The Peytons seem to accept the need for pay parking in the downtown core. And they also admit they, with their twin three-year-old daughters in tow, make use of Penticton's oh-so-contentious bike lane.

But neither was a factor when Slackwater opened. And now, they say, paying for parking on their stretch of Martin is a convoluted affair that baffles first-timers.

Worse still is the positioning of the bike lane, directly in front of their operation and eliminating all spots on that side of the street.

Beyond all that, 2023's spate of wildfires and the now infamous mid-August travel ban certainly didn’t help.

"Last year's wildfires were devastating for tourism, and this year did not really pick up," said Liam. "We sell beer to everyone, throughout the Okanagan and Kootenays, so we have a good pulse on how everyone else is doing too.

"And the travel ban sucked. It was horrific. We’re probably talking six-figure damage to our business in that period."

"It was the final blow," added Kelsey. "At the end of August you generally have a lot of momentum. But with the travel ban and the rockslides (both near Summerland), that was it."

And now it’s time to mosey on down the road. Next up for the Peytons is the Saturday goodbye party. Then the clean-up to the taproom/restaurant/kitchen areas goes into overdrive.

Beer production and packaging will continue 'til the end of November, when clean-up begins there too. They need to vacate by the end of the year.

Where will Slackwater production relocate? As for now, they're uncertain.

"We're not sure where yet," said Liam. "We’ve talked to people in the Okanagan and people on the coast. But wherever it goes, literally the only change will be the address on the beer cars. That’s it."

One thing that does seem certain is their living arrangements. The Peytons will stay in Penticton, where they own a house "in a lovely little area of town."

Whether another, smaller, more manageable Slackwater-ish taproom is in the cards will be determined in the future.

"We'd probably love to start up a smaller Slackwater atmosphere somewhere locally sometime," said Kelsey. "But it's not in the conversation right now. For now we're really looking forward to spending more time with our family."

What is in the conversation are occasional bar takeovers and "Slack Shack" pop-ups. And trivia nights, like the one next Tuesday just down the street at The Hub, where the questions are penned by Liam and the official sponsor is Slackwater.

They'll continue running their ski movie nights too, hopefully beginning early this season at the Gunbarrel Saloon at Apex.

We asked Kelsey if she's happy they created Slackwater and ran with it 'til now.

"Yes," she said. "We've learned so much. We've had such an incredible staff and we've had so many incredible local businesses support us over the years.

"And we're extremely proud of the brands."

As for Liam, who's designing and building an electric guitar in what little spare time he has and says that overall, Slackwater has sold the equivalent of two million glasses/cans of beer, the last few years have mostly been "awesome."

"Thousands and thousands of people have been through here," he said. "We've sold a lot of good beer here and had a lot of fun. And we'll have some staff with us on the final day who've been with us from the start."

And he's proud of the work the local breweries do for the city.

"We've built good relationships and leveraged collaborations with bigger breweries from bigger markets to try to elevate our name and our city and the Penticton Ale Trails and the Beer Blocks crew.

"We're all competitors, but we’re all friends. Together we bring people into Penticton for the greater good of all or our businesses and our community. What other industry does that?"

The last day of operation for the Slackwater Brewing taproom is Saturday, Oct. 26. The party starts at noon and undoubtedly goes well into the night.

For more info, go here.