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Global Wine Partners Prospers As Biggest Client Loses

December 6, 2011 | Filed under Featured Articles | Posted by

As Levi Strauss learned during the California gold rush, it is often better to be a supplier to the miners than be a miner yourself. And so it is that St. Helena-based Global Wine Partners (GWP) — which staked its claim as a supplier of advice to wine industry investors — has made almost $3 million (see chart below for details) for vetting and assembling the winery and vineyard properties that have so far lost Entertainment Properties Trust (NYSE:EPR) an estimated $81 million on a wine portfolio EPR paid $195 million to acquire.

Global Wine Partners VinREIT Compensation

Global Wine Partners VinREIT Compensation

What’s more, the structure of the relationship has obligated EPR to continue paying GWP a percentage of the annual cash flow even as EPR continues to lose money on the critically wounded portfolio.

The worst may be yet to come. The largest investment in EPR’s portfolio — $116.5 million for Ascentia Wine Estates — has been on the ropes for more than a year, spinning off assets, selling wine at fire sale prices and desperate for a sale or acquisition in order to avoid bankruptcy.

Global Wine Partners — which, according to SEC disclosures is 33% owned by the brother of EPR’s CEO — has been in charge of selling the entire portfolio for more than two years now with little results. EPR has recently retained an unspecified number of brokerages to try and unload the remaining properties.

Other than answers to four minor questi0ns, Global Wine Partners had no response to Wine Industry Insight’s inquiries. In the interest of being fair, complete, accurate and in context, WIN sent this article to GWP’s three partners on Monday afternoon and asked for any corrections or comments they might have. No response was received by publication.

Wine Executive News subscribers please click here to read the complete 2,967-word  article and compensation table.

Also In This Article:

The full text of the following sections is available to subscribers of Wine Executive News.

  • THE EVOLUTION OF AN ACCOUNTING FIRM TO GLOBAL WINE BANK

  • JOINT VENTURES, EQUITY, A PIECE OF THE CASH FLOW

  • FINDER’S FEES, DUE DILIGENCE, PERCENT OF NET

  • DUE DILIGENCE & THE COSENTINO WINERY CATASTROPHE

  • EXTENSIVE EXCERPTS FROM EPR’S SEC FILINGS USED TO PREPARE COMPENSATION TeABLE

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