Woodstock takes over MobCraft Beer’s equipment after brewery shuts down at city-owned Old Courthouse

The city of Woodstock will not receive a cash payout from the now-closed MobCraft Beer but will take over the brewery’s equipment and other property left in the Old Courthouse.

Delinquent on its city lease since October, MobCraft Beer Taproom and Brewery closed Nov. 30.

The Woodstock City Council on Tuesday unanimously approved a settlement agreement with the Milwaukee-based business that will allow the city to regain control of the leased space in hopes of finding a new tenant as soon as possible.

[ Candle shop to leave Woodstock Old Courthouse incubator ]

As part of the agreement, the city gained ownership of brewery equipment, including brewing vats, coolers and tanks, as well as tables, chairs and other property left behind. City officials said the equipment could help attract a future tenant.

Woodstock Mayor Michael Turner emphasized that MobCraft’s closure was the result of corporate decisions unrelated to its operations in Woodstock, which had been successful and profitable.

“Why we’re here has nothing to do with their operation in the city of Woodstock. … It’s unfortunate, and we can mess around with trying to grab more money, but it delays our ability to move on,” Turner said.

“Interest in this space is high, and I’m optimistic we end up with something.”

The city acquired the Old Courthouse, a historically significant landmark central to Woodstock’s identity, in 2011. Since then, city leaders have invested in preserving and modernizing the building as a mixed-use space, including restaurants and shops, some of them part of a business incubator program.

MobCraft received a revolving loan of $68,500 from the city for brewery-related expenses last year, and the lease for the space was approved in October 2022.

Although the business was delinquent on its lease, it remained current on the loan, said Danielle Gulli, the city’s executive director for business development.

However, MobCraft owner Henry Schwartz indicated to city leaders that due to the company’s significant debt load and impending bankruptcy, further payments on the loan would not be possible. About $59,000 to $60,000 remains unpaid on the loan, Gulli said, and the brewing equipment will serve as collateral.

“Ideally, the value of the equipment would be recovered from a future tenant who would pay more in rent for the turnkey brewpub space,” Gulli wrote in a memo to city leaders.

While the city retains ownership of the equipment, there is some risk that creditors involved in the bankruptcy process could stake claims on these assets, Gulli said. While such claims are possible, she said, they are unlikely to be pursued.

“Our top priority is getting the space back so we can get it back on the market,” she said.

City staff is collaborating with a commercial real estate agent to market the space and is open to proposals from a range of potential tenants, including breweries or other concepts.

Gulli noted that interest in the Old Courthouse space has been strong, with outreach from parties including a former MobCraft employee.

In the meantime, Naturally McHenry County, a nonprofit that promotes county tourism and is currently based in Huntley, intends to move into a separate space in the Old Courthouse. At Tuesday’s meeting, the Woodstock City Council unanimously approved a five-year lease for the organization beginning in March. Rent was set at $1,050 a month, with incremental annual increases.

In the past, Woodstock has faced several challenges with tenants, including the closure of Public House restaurant earlier this year. Public House, which was replaced by Squire on the Square, also had a loan and the city is aiming to recoup more than $250,000 from Public House’s owner.

Algonquin-based DIY crafts store Makity Make closed its Old Courthouse location in May. The Records Department record store outgrew its space in the incubator located inside the Old Courthouse and moved to a larger space in downtown Woodstock this past summer.

Seleta Scents, the other incubator business, intends to move out at the end of this month into a larger space, Gulli said.

Despite setbacks, city officials remain optimistic about the longterm viability of the site. Plans are underway to add signs, Gulli said, with concepts expected to come before the city council in January.

“I think that will help drive more foot traffic to the space,” she said.

She said that the city’s revolving loans, designed to support local businesses and economic growth, remain a critical incentive tool for businesses.

During Tuesday’s meeting, however, Woodstock City Council member Bob Seegers Jr. questioned the use of these loans.

“It might be time for us to revisit the viability of us offering that revolving loan fund,” he said.

City leaders agreed to continue evaluating the program’s effectiveness and explore ways to mitigate future risks.