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Appraisal of
Bourbon Distilleries
Nationwide Real Estate Appraisal Service
February 28, 2018
American Appraisers Corp Home Page
Real estate appraisal services provided by American
Appraisers Corp
Real Estate Directory Sites
States covered by American Appraisers
Qualifications of David J. Glauber, MAI
Questions about real estate appraisal and appraisers
Church Appraisers Appraising churches
_American
__Appraisers
___Corporation
(502) 267-6320 Office
(502) 267-6344 Fax
10507 Watterson Trl., 2nd Flr
Louisville, KY.  40299
.:American Appraisers Bourbon Distilleries
Nationwide Real Estate Appraisal Service
February 28, 2018
Distilleries in Kentucky are usually bourbon distilleries although they don't have to be.

Small Bourbon Distilleries are popping up all over the state and I have been fortunate enough to have appraised
several of them.  The worldwide demand for Kentucky Bourbon Whiskey has been increasing at an extremely rapid
rate, causing the demand for new Kentucky distilleries.  As new distilleries are built there is always the risk that the
market will become overbuilt.  However, this has not proven to be a problem since Bourbon can only be made in
Kentucky.  This gives Kentucky a distinctive advantage in that the entire world is demanding the product, but only
Kentucky can make it.  Therefore, it is likely that new distilleries will continue to prosper in Kentucky.   

Distilleries are extremely complex and require a tremendous amount of dedication in order to competently appraise a
bourbon distillery.  Driving this dedication must be a love of the subject matter, which I happen to have.  

Definition of Bourbon:  Bourbon is corn whiskey, made in Kentucky using limestone water and distilled to a proof of 125
to 160 and stored in a brand new charred white oak barrel.  The product can use other grains in addition to the corn,
but corn must represent the majority (51%) in order to be considered bourbon.  

In recent years there is a push from international distillers to broaden the definition of bourbon to state that it can be
made anywhere in America or not even have a geographic boundary.  The reason for this push is easy to see.  Giant
international companies want to be able to make Bourbon anywhere in the world in order to take advantage of cheap
labor and lax labor laws.  This definition is routinely posted on the internet as "the" definition of bourbon.  However, the
roots of Bourbon are in Kentucky and therefore, the historical definition is based on hundreds of years of tradition.   

The history of bourbon:

Kentucky was originally Kentucky County of Virginia. It was eventually separated into its own state (Commonwealth) and
divided into 3 counties, Jefferson, Fayette and Lincoln. Later, Bourbon County was formed out of Fayette County,
which roughly included about 25% of the State of Kentucky and is now called Eastern Kentucky. (See picture below).
Since land  in Eastern Kentucky is rough mountains, corn was turned into whiskey and shipped down the river to New
Orleans. The barrels were marked Old Bourbon or Bourbon Whiskey to denote their origin. As time went by, the term
bourbon came to include all whiskey from Kentucky. This was significant, as KY Bourbon was made from corn, whereas
Pennsylvania whiskey was made from rye, or something other than corn. From these roots, bourbon became distinctive
in its flavor and became known as Kentucky Bourbon Whiskey.

While whiskey can be made somewhere else and may be made exactly the same as bourbon, it is NOT Bourbon since it
is not made in Kentucky. Just like Champagne must be made in Champagne France in order to be Champagne. Just
because California can make sparkling wine that is just as good as Champagne, that does not make it Champagne.
The same is true for Bourbon. Just because Japan can make whiskey that taste exactly like Kentucky Bourbon, that
does not make it bourbon. It makes it whiskey that taste like bourbon, not bourbon.

So, as you can see, bourbon must be made in Kentucky in order to be called bourbon, in fact, you may go so far as to
say that it must be made in Eastern Kentucky if you like, but you can never say it can be made somewhere besides
Kentucky.

This is Kentucky's creation, lets keep it that way.

David J. Glauber, MBA, MAI
President
American Appraisers Corp