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Bordeaux Winemakers Are Snapping Up Napa Estates

Published on Mar 24 2016 10:30 AM in Drinks tagged: Wine / bordeaux

Bordeaux Winemakers Are Snapping Up Napa Estates

Alfred Tesseron, who owns Bordeaux château Pontet-Canet, hunted for a Napa Valley property for years. When he and his niece Melanie saw the late Robin Williams’s 640-acre Villa Sorriso high up on Mount Veeder in September, it had the right wine “magic.” The closest neighbor is musician (and vintner) Boz Scaggs.

The château’s visionary technical director, Jean-Michel Comme, walked every row of the 18.4-acre vineyard, probing the soil and vines. The real estate broker organised tastings of older vintages of classic wines made from Mount Veeder grapes, such as Mayacamas, to let Comme see the potential to make great cabernet. He gave it the nod.

The estate came to the market in 2012 priced at $35 million, but Tesseron was able to snap it up six weeks ago for $18.1 million. In some ways, this was a tough sell. The location is remote, and realtors say people looking primarily for a residence like Williams’s 20,000-square-foot house prefer being closer to the restaurants and activities in St. Helena. Likewise for those looking to invest in a show-off wine estate, who frequently want fewer acres.

The Tesserons are the latest players in the new, high-profile wave of Bordeaux vintners sweeping into Napa. French fashion house Chanel, whose billionaire owners Alain and Gerard Wertheimer have Bordeaux châteaux Rauzan-Segla and Canon, plunked down an undisclosed sum for the St. Supéry estate in October. (Wine country insiders speculate the the figure might have been in the neighborhood of $125 million.)

That followed the 2013 purchase of cult winery Araujo Estate by Francois Pinault, owner of first growth Chateau Latour.

Now many more Bordelais are e-mailing and wanting to take a look, says real estate broker Robert Landsness of Pacific Union, who worked with the Tesserons.

Cyd Greer, the listing agent for the Williams estate, who is affiliated with Coldwell Banker, has seen an uptick in interest from Bordeaux in just six months, she said during a phone interview.

Considering that many family wineries in the valley will go on the market in the next five years, Bordeaux’s interest is very good news.

By coincidence, the Bordelais are buying top spots in Napa just as the Chinese are upping investments in Bordeaux. Among the four châteaux sold to status-conscious Chinese buyers in the last few weeks is Château de Sours, billionaire Jack Ma’s foothold in the region. (Stay tuned for my review of the wines, coming in weeks.) So far, the Chinese strategy in Bordeaux has been to buy less prestigious châteaux among the region’s 8,000 small properties, with the aim of supplying mid-priced wines to the part of the Chinese market that’s growing.

They’ve been active in Napa in a quiet way. Sloan Estate, for example, was sold to Hong Kong businessman Pan Sutong’s Goldin Group in 2011 for $40 million. Sutong also owns several châteaux in Bordeaux.

The Right (Financial) Climate

So what’s Napa’s appeal for Bordeaux crus classés?

One is financial. Château owners admit privately that buying outside Bordeaux and France is a way to diversify their wine investments. Recently, Bordeaux wines have been a hard sell. Recent vintages haven’t been stellar. The market for top Bordeaux in China has cooled dramatically with the government push against lavish gift-giving, and collectors there have dramatically turned to Burgundy.

Napa cabernets, on the other hand, are booming, with the value of top names climbing on Liv-Ex, especially in the last year. Cult wine Scarecrow, for example, gained 19.9 percent in value from the end of 2014 to the end of 2015, topping Liv-Ex’s annual 100 Power Brand list.

Another reason? As Melanie Tesseron e-mailed: “The U.S. is a country that we are very comfortable in and that we are confident in investing in.”

News by Bloomberg, edited by Hospitality Ireland

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