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City Brew to lease prime site for new facility
Steve Corning and Becky Reno look over plans for the Old Country Buffet location at 24th Street West and King Avenue West.

Marketplace, the hottest retail spot in Billings, is only 15 years old, but already the area is witnessing a building demolition in order to make room for the next retail wave.

In 1993, Old Country Buffet opened at the corner of King Avenue West and South 24th Street West. The restaurant was among the first buildings as the vacant gravel pit began to fill with stores.

Showcase facility

The Old Country Buffet closed in February. Now, the next use for this prime commercial site is a showcase City Brew Coffee and roasting facility.

"It wasn't vacant for a week when we started talking," said City Brew owner Becky Reno. "You can imagine how excited we are."

On June 20, Tryans Auction will sell 130 pieces of equipment from the Old Country Buffet and six days later, Jim's Excavating will begin demolition.

As soon as the rubble is cleared, Billings developer Steve Corning will start.

"We're going to scrape the building and totally redevelop it," he said.

Reno will take 7,000 square feet, leaving 3,000 square feet for another tenant for which there is considerable interest, Corning said.

While the design still is being finalized, Corning will build a wall of glass along the South 24th Street West side so people can watch the roasting operations.

The concept is to offer tours and free samples, called "cuppings," and educate consumers.

Empowering customers

"We think that's part of empowering customers to understand coffee. Microbrews do this, only we're making coffee and they're making beer," Reno said.

The location also gives City Brew a drive-though for its King Avenue West customers.

When the construction wraps up, the City Brew at 2695 King Ave. W. will close, and Corning will lease that space to another tenant.

Roasting is the fastest-growing part of the company. With two roasters on site at the North 27th Street store, the company roasts 10,000 pounds of green coffee beans a month. That's just one-third of the current capacity of 30,000 pounds a month.

If her plan to sell coffee blends in grocery stores across the West and Midwest succeeds, by next year Reno will use up that extra capacity and more.

"When the building is ready in February, we'll probably be at 75 percent capacity by then and still need a third roaster over the next 18 months," she said.

In April, she flew with Jim Coons of Collaborative Design Architects to Seattle to show him some concepts for the storefront roasting business.

City Brew boom

After opening the first City Brew/City Vineyard in Billings in 1998, Reno built another seven stores, the latest in March in Missoula. Last year, she started venturing out into coffee kiosks and started posting double-digit sales growth.

Roasting green beans in-house originally was to guarantee high-quality coffee for the retail brews. When the West End store is completed, all the roasting operations will move there from the North 27th Street location and another round of expansion will begin.

With roasting revenues growing an estimated 25 percent this year, Reno is working on a new concept: Selling City Brew's dozen blends in grocery stores in 14 states west of the Mississippi, including Alaska.

"We were trying to understand the business of roasting. Now we've got our arms around it," Reno said. "I feel we're ready."

Budding business partners

Corning, the man chiefly responsible for developing the strip of big-box stores along King Avenue West, started learning the real estate trade a quarter-century ago by working with Reno.

Corning was the builder and leaser.

As Reno started expanding her Video Library chain in 1983, she turned to Corning to build stores to order and leased them from him.

"We often joke that when we started, it was much easier to find the sites than put the financial package together," Corning said. "Now it's much easier to put the financial package together than to find the sites."

In 2003, Reno sold Video Library to Alabama-based Movie Gallery for an undisclosed amount of money and started concentrating on the City Brew and City Vineyard businesses.

Corning and his partners now own 40 properties around Montana. At Marketplace in Billings, the handful of big-box stores own their land. The other stores lease from Corning and his partners.

Whether it's movies or coffee, crafting a successful retail business in today's competitive world requires getting all of the variables right, Corning said.

Reno is one of the best independent retailers in the region, he said.

"Today you run into incredibly indifferent to nonexistent service," he said. "But you walk into one of Becky's stores and the employees smile at you. And they deliver the product in a timely fashion."

Contact Jan Falstad at jfalstad@billingsgazette.com or at (406) 657-1306.

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