Scotland’s Next Wave of Whisky Distilleries

(Bloomberg) -- It's no secret that Scotch whisky is booming. The industry posted record-breaking exports in 2017, according to a report by the Scotch Whisky Association, growing in both volume and value (by 1.6 percent and 8.9 percent, respectively) to a total of £4.37 billion ($6.65 billion)—the equivalent of 1.23 billion bottles exported globally. Single-malt Scotch saw 14 percent year-over-year growth to £1.17 billion, the second year in a row to break the billion-pound threshold, reflecting a trend toward premium products in global markets.

And at auction, it's proved a gangbusters alternative investment, far outpacing fine wines, according to Bonhams Hong Kong. In May, the record for the most expensive bottle ever sold was smashed back-to-back when a rare 60-year-old Macallan whisky fetched HK$7.96 million ($1.01 million) only to be broken by a second bottle going for $1.1 million hours later at the same event. Young, affluent Chinese consumers are particularly hot for the spirit.

As a result, money is pouring into its expansion, with distilleries in Scotland opening at a rapid rate, be they reclaimed historical brands to totally new operations. In the past two years, Julie Trevisan-Hunter, marketing director at the Scotch Whisky Experience in Edinburgh, counts more than 50 that are either functioning now, in the pipeline, or in discussion across the country. The reason for this growth is simple, she says: “Globalization.”

“Every town now has the same shops from New York to Edinburgh, and we are so closely connected and our pace of life is simply incomparable to what it was just 20 years ago,” says Trevisan-Hunter, who's also the youngest female “Master” in the Keepers of the Quaich (pronounced “Quake”), a knighthood of sorts in the world of whisky. “There is a real hankering for tradition, something crafted, from the land, that has a sense of place.”

Just like appreciating the story behind your Filson bag or Red Wing boots, each distillery has a history you can feel connected to when ordering a drink at your local bar. A seriously in-depth new book, Single Malt: A Guide to the Whiskies of Scotland (out Oct. 16) provides the history, science, and a buyer's guide for more than 330 expressions alone. And Trevisan-Hunter reeled us in with her romantic description of the taste: “The oak casks breathe in the Scottish air, which is very different in every glen and valley where the whisky is made. While many drinks can be made anywhere with no heritage or longevity, Scotch has a distinct locality.” It's the Harris Tweed of booze.

Scotch is a long game due to the aging requirements, changing the mindset of the business, she says. People setting up distilleries today won't make money for many years, which means there are quite a number of people putting down capital simply from a passion for the product.

“It's a fantastic mixture of big distilleries right down to one single person investing,” says Trevisan-Hunter. Here are six new and nearly opened Scotch distilleries she recommends we keep tabs on for the coming year.

Isle of Raasay Distillery

Opened: September 2017
Touting the first legal distillery on the Isle of Raasay, which sits between the Isle of Skye and the Scottish mainland, the team is hoping to create the finest Hebridean single-malt whisky using a combination of virgin American oak casks and casks previously used for high-rye-content bourbon and wine. The mashup of new and reclaimed Victorian buildings contains a five-bedroom luxury hotel, so you can drink your drams till the wee hours.

The Clydeside Distillery

Opened: November 2017
Located on the Queen's Dock, where for decades, whisky was shipped out of Glasgow bound for bars around the globe, Clydeside is the second of three distilleries opening in the industrial center (the first one was Glasgow Distillery in 2014 and the third is as yet unnamed but will be on the Pacific Quay). While you can tour the distillery now and learn about its history in Glasgow, Clydeside's spirit won't be matured and ready until at least 2020. In the meantime, its shop has plenty of options from other producers and the opportunity to choose your favorite and create a bespoke label for your bottle.

The Borders Distillery

Opened: May 2018
This is the first distillery to open in the Borders area in 180 years, and it's already getting some competition farther south in England (though no, that's technically not Scotch). Located in the former Electric Company building in the heart of Hawick, the £10 million project is expected to produce a light, fragrant, and floral style of malt whisky—a very typical Lowlands character using barley entirely from the Borders region. Available in 2020.

Toulvaddie Distillery

Opening: Late 2018
Founded by Heather Nelson, Toulvaddie Distillery is the first Scotch whisky distillery to be established solely by a woman in almost 200 years. Construction of this brand-new microdistillery on the site of the old World War II Royal Naval Air Station HMS Owl, not far from the long-established Glenmorangie Distillery, is well under way, and whisky production will begin as soon as it's completed. To fund the single-owner project, a limited number of 70-liter casks to be filled in the first year are already available to purchase for £2,000 each.

Falkirk Distillery

Opening: Late 2018
Rosebank Single Malt was last produced in Falkirk, about 45 minutes west of Edinburgh, in 1993. The new distillery and visitor center is built from scratch but with a traditional appearance. In addition to its distinctive triple-distilled spirit, the distillery aims to become a retail, restaurant, and commercial business destination.

Holyrood Park Distillery

Opening: Summer 2019
Situated next to Holyrood Park in the heart of Edinburgh, this is the first new malt distillery to open in the Scottish capital in nearly 100 years. The historic Engine Shed on St. Leonard's Lane, which was built in 1835 as part of the Edinburgh & Dalkeith Railway, will house both the distillery and a hands-on sensory and educational visitor center. It's all in very good hands as David Robertson, the former master distiller from Macallan and founder of Rare Whisky 101, is heading up the team.

To contact the editor responsible for this story: Justin Ocean at jocean1@bloomberg.net

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