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Today’s bargain basement sale of the White Hills Vineyard by the Foster’s Group Ltd., has rattled players in the Central Coast vineyard market and sent them scrambling to figure out what it means for vineyard values. The sale comes as part of the Foster’s Group’s spinoff of “non-strategic” properties as reported by Wine Industry Insight in February 2009.
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WHITE HILLS SELLS FOR LESS THAN HALF OF “GOING RATE”
According to informed sources familiar with the sale, the Westchester Group, a large Midwestern ag investment firm, bought the 4,300-acre vineyard near Santa Maria for $(Redacted-Subscriber data only) — less than half of the estimated “going rate” for vineyards properties in that area.
Vineyards are planted on 2,300 acres while another 1,200 acres are plantable and 800 acres are watershed.
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Westchester already owns the Garey Ranch Vineyard, east of Santa Maria which is planted with approximately 280 acres of Chardonnay, Pinot Noir, and Pinot Gris.
Wine Industry Insight placed calls to Westchester Group and Foster’s on April 21, but no comments had been received by publication time.
CAUTION NEEDED ON APPLYING SALE TO OVERALL MARKET
According to a presentation by Hal Forcey, Senior Appraiser, American AgAppraisal, at this year’s Central Coast Wine Symposium, the value of vineyard land in the Santa Maria area is estimated at $18-$30,000 per plantable acre and $30-40,000 per acre planted.
Prices, according to his presentation (.pdf), have been stable, feeding the value ($10+/-) wine market. However, the presentation cautioned that there had been no vineyards sold in the area for the previous two years. “And those past sales were for significantly smaller holdings,” said Forcey.
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