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Sunday, 11 August 2013

Where to Buy a Vineyard

Worldwide vineyard sales are reportedly on the rise

At some point in life, every wine lover thinks fondly about purchasing a vineyard. At that point, the old adage about what’s needed to make a small fortune in winemaking (start with a big one) flits through the mind. Then there's the hands-on labor that vines require and the fact that drinking wine is not really the same as making it. But just sometimes, none of that happens and the decision is made to actually buy a vineyard.
If so, the prospective purchaser is currently in good company. Although global figures for vineyard sales are hard to come by, something of a boom appears to be underway after a quiet few years. And while the elements driving speedier vineyard sales around the world differ, there are some that apply across the board. These include ever-growing Chinese demand (for both wine and vineyards), a general uptick in "lifestyle" or "hobby" vineyards, fears of an American grape shortage, and a growing worldwide premium on farmland.

What you can get for around $1 million
South Africa, Western Cape, Stellenbosch

  • Vineyard area: 11 hectares. Total land area: 27 hectares.
  • Grape varieties: chenin blanc, riesling and pinotage.
  • Terroir: mountain slopes, clay-based soils.
  • Cost: $1.3 million.
  • Realtor: Sotheby’s International Realty affiliate Lew Geffen.
The property has views of the Stellenbosch and Helderberg mountain ranges, as well as sea views from some positions. Located on the Stellenbosch wine route, it includes two main houses, a pool, staff cottages, a stable block, workshops and a barn.

On South Africa's Stellenbosch wine route, this estate is priced at $1.3 million

© Lew Geffen. On South Africa's Stellenbosch wine route, this estate is priced at $1.3 million

What you can get for $3 million to $4 million
France, Bordeaux, Entre-Deux-Mers

  • Vineyard area: 15 hectares (organic), 13ha of which are in production. Total land area: almost 19 hectares.
  • Grape varieties and soil: merlot and cabernet sauvignon with an average age of 10 years, on clay over limestone soil.
  • Cost: about $3.8 million.
  • Realtor: Christie’s affiliate Maxwell-Storrie-Baynes. 
This "quintessential Right Bank" estate includes a fully renovated, four-bedroom, limestone château, parts of which date back to the 12th century, as well as a guest cottage, pool, outbuildings and a lake.

In Bordeaux, an Entre-Deux-Mers château can be yours for $3.8 million
© Maxwell-Storrie-Baynes | In Bordeaux, an Entre-Deux-Mers château can be yours for $3.8 million


What you can get for $4 million to $5 million 
New Zealand, Marlborough, Renwick

  • Vineyard area: about 21 hectares. Total land area: 24 hectares.
  • Grape varieties: sauvignon blanc, pinot noir, chardonnay.
  • Planted and developed since 1996.
  • Cost: about $4 million.
  • Realtor: Christie’s affiliate Bayleys.
Summerhouse Vineyard comes with a four-bedroom house built in 2002, a solar-heated pool, a well, irrigation, workshop and storage sheds, staff facilities, an office building and a tasting room. The soil is described as "stony loam" and the vines are planted on a gentle north-facing slope. The current owners, Heather and Meric Davies, are returning to their first love, stock farming. Says Heather: "The call of the cattle is too great.
What you can get for $10 million and up
Italy, Tuscany (estate name confidential)
  • Vineyard area: about 40 hectares. Total land area: 90 hectares.
  • Grape varieties: mainly prugnolo gentile, as well as merlot, syrah, cabernet franc and some experimental pugnitello.
  • Cost: 30 million euros ($39 million).
  • Realtor: Transworld Business Brokers via VineSmart.com.
The "picturesque yet state-of-the-art" estate includes a farmhouse, a country house, a new underground winemaking facility, warehouses and an olive grove.
Rough Guide to Buying a Vineyard
Compiling a worldwide list of what’s hot and what’s not in the vineyard world is a complicated task. But Mark Hazell of VineSmart.com, a global vineyard sales website, says that as a rough guide France, Italy, Spain and Portugal tend to be the first pick for many buyers.
“After that, it’s probably Australia, New Zealand and Argentina," followed by Germany, Bulgaria and Croatia. Only then does South Africa figure on the list. Its low ranking – although many in the wine world are unwilling to admit it – is unrelated to wine or vineyard quality, as both are highly regarded. Rather, potential buyers have continuing security concerns in the post-apartheid era.

In Argentina (known as much for its vineyards as for its agricultural beef and grain output), a rise in transactions is being driven by local winemakers eager to sell, while risk-ready investors step in to buy.
“In the last six months things have really picked up,” said Nadia Binesh, who runs BBI Argentina. “Last year was dead, mainly due to a proposed law limiting foreign farm ownership.”
Three factors have now combined to feed the real estate market: the resumption of farmland and vineyard sales to foreigners as of March 1 this year, a local hunger for dollars due to government limits on access to foreign currency, and frayed Argentine nerves about what further plans President Cristina Fernandez de Kirchner might have for the economy.
“I am currently dealing with interested buyers in Qatar, Beijing and Copenhagen,” said Binesh, explaining that for these purchasers the recent bad news out of Argentina represents an opportunity.

Marlborough's Summerhouse Vineyard is on the market for $4 million
© Bayleys | Marlborough's Summerhouse Vineyard is on the market for $4 million

New Zealand is attractive to potential buyers because owning farmland is a gateway to residency, said Hazell, who has recently seen the worldwide vineyard market “come alive after three quiet years.” He describes one type of prospective purchaser as “looking for a different, simpler life, and these buyers are ready to make a big move to somewhere like Australia or New Zealand.”
Others are looking for a part-time “pastoral escape” – for example in California, which remains a mecca for both hobbyists and full-time winemakers. Hazell reports that the wine regions of Oregon and Texas are also getting more of a look-in these days.
For vineyard appraiser Tony Correia, of the Sonoma-based Correia Company, one of the current market drivers in California is a fear of a future grape shortage.

“In Napa, Sonoma and the Central Coast, wineries are looking to secure grape supply and they’re buying up vineyards in the small, medium and large categories. That’s been happening over the last 18 months." The last time Correia saw this level of activity was more than 10 years ago.

Another current hot spot for international buyers is, of course, Bordeaux, including the Entre-Deux-Mers property listed above. According to Sarha Duprat, of Bordeaux-based realtor Demeures et Vignobles, an affiliate of Sotheby's Real Estate, sales in the region have risen by about 30 percent in 2012–2013, with Chinese buyers leading the charge.
Antonia Koumantaropoulou, from Christie’s International Real Estate, said Bordeaux had an advantage over other wine regions, because it was still “relatively inexpensive when judged by the prices over the past 20 years.”

For even better value, though, don’t forget France's neighbors. At Transworld Commercial Real Estate, vice president Tom Milana reports that international investors are starting to take a “hard look” at good-value, high-end vineyard properties in Italy and Spain. Their calculations are based on a weaker euro and these countries' slower economies.

Source: www.wine-searcher.com