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Bourbon bigwig scoops ice cream warehouse for a new distillery

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Kentucky Co-operative Distillery will be nestled near Yew Dell Botanical Gardens in Crestwood

By Tracy Harris

The locally-produced, artisan-quality trend is taking hold in another industry — and one Pewee Valley man hopes to be ahead of the curve.

First it was cheese, wine, bread and beer — all products seeing a rise in “craft” production focused on small batches and special ingredients.

Now, it’s spirits. Bourbon, vodka and other spirits are being produced by micro-distillers across the country.

And Steve Thompson is taking his decades of liquor-industry experience and trying something different.

He’s set to open Kentucky Co-operative Distillery in Crestwood next month.

In addition to producing his own bourbon brand, the distillery will be a veritable Kinko’s for wanna-be distillers. 

The facility will be open for other individuals and companies to distill whatever spirits they’re interested in, rather it be a one-time creation for a special event or a long-term project.

Construction is underway to convert a former ice cream storage facility into a welcoming, attractive distillery.

“That’s my wife’s doing,” Thompson said, referring to overhangs and a covered deck being built.

The distillery is next door to Yew Dell Botanical Gardens, who Thompson hopes to partner with for events in the future.

Kentucky Co-operative Distillery will also have event space, Thompson said, and will have extensive landscaping with help from nearby Boone Gardiner Garden Center.

He plans for the distillery to be included on an off-shoot of the Kentucky Bourbon Trail that will focus on micro-distilleries.

Currently, there are about 250 micro-distilleries nationwide, including about 11 in Kentucky, according to the American Distilling Institute.

Thompson said many micro-distilleries are launched by people with an interest in distilling but no industry experience.

After spending money to build a distillery, some are left without funding to market the business.

And Thompson knows it’s all about brand recognition.

With decades of experience at large companies — he’s a past-president for the Brown-Forman Distillery Company — Thompson knows what he’s talking about.

“The liquor industry is like the entertainment industry,” he said. “You have to make people feel like they’re a part of something.”

That’s different than wine, where there’s little brand loyalty, he said — customers will just purchase something else.

Thompson hopes micro-distilleries will help Kentucky hang on to its bourbon heritage.

“We could lose bourbon like we lost the horse industry,” he said. He worries a number of state regulations, including prohibiting shipping product out-of-state without a distributor, could hinder the industry’s growth.

Currently, alcohol can’t be shipped from Kentucky to another state — and many don’t want to check luggage with liquor in it.

Distilling is permitted in dry and moist counties and requires a specific license. 

“Protective rules never help grow a business,” Thompson said.

Thompson hopes his business will help other distillers get started. 

Business owners can lease the stills at Thompson’s location to ferment spirits, and can also use the distillery to barrel, age and bottle products.

Companies producing their own liquor and in need of bottling equipment can also utilize the distillery.

Thompson also plans to have office space available for users.

Kentucky Cooperative Distillery will also be tourist-friendly, hosting tours, tastings, concerts and other events. The event space has high ceilings and one wall will be barrel storage. 

Thompson has collected historical newel posts and other woodwork, including pieces from an old bank in Pewee Valley, and plans to use it to create a bar.

And a second-floor space will house a restored antique copper still in front of a picture window visible from the street. Thompson plans to have it softly lit at night.

Thompson said he chose Crestwood despite looking at spaces in downtown Louisville. 

“I’m hoping to revitalize the distillery business in Oldham County,” he said, citing three distilleries that operated in Brownsboro in the late 1800s and early 1900s.

Thompson also hopes to utilize local farmers for wheat, barley, corn and fruits to use in liquor production.

The Kentucky Co-operative Distillery will open at a unique time in the Commonwealth’s bourbon history — bourbon inventory is at a 30-year high.

More than 4.9 million barrels are aging in Kentucky, according to the Kentucky Distillers’ Association — meaning there are more barrels of bourbon than there are residents.

“Bourbon is in its largest expansion phase since Prohibition,” said Jeff Conder, KDA chair.

Conder is also the vice-president of American operations for Beam Inc., the parent company of Jim Beam.

“Only Kentucky, the birthplace of bourbon, can provide the genuine experience with our rich history, tours, tastings and so much more,” he said.

Nearly 12,000 people completed the Bourbon Trail in 2011, a passport program promoting bourbon by encouraging visits to six different distilleries.

The distilleries are in several different cities, including Clermont, Bardstown, Loretto, Lawrenceburg and Versailles. 

Organizers recommend at least two days to complete the tour, although the passport could also be completed over multiple weeks or months.

Louisville also has the Urban Bourbon Trail, a similar tour with nine bars and restaurants featuring bourbon.

The bourbon boom also includes the Bourbon Chase, a 200-mile running relay race scheduled for Sept. 28 and 29. The course runs through six distilleries, starting at Jim Beam in Clermont and ending in Lexington.

It brings more than 3,000 runners onto the bourbon trail, 60 percent of whom are from other states, said race director Mike Kuntz. There are participants from 44 states this year, he said.

According to the KDA, nearly $220 million is planned for equipment, warehouses and new facilities.

“Bourbon is a rising global symbol of Kentucky craftsmanship, responsible for 70 percent of all U.S. spirits exports,” Conder said.

Thompson is excited about his new role in the industry.

“We’re trying to decide if we’re really going to go to work or just have fun with it,” he said. 

He’s finalizing designs of his bottle label, which will include a golden Retriever laying on its back.

“We’re calling it Dog’s Breath — it’s whimsical,” he said.

But for now, he’s more interested in bringing in others to use the facilities.

“We’ll worry about (the bourbon) in four years when it’s ready,” he said. “Then we’ll either go broke or we’ll sell it.”