Investment Updates
Ever Think About Investing In A Vineyard?
Published Tuesday, April 8, 2008 at: 7:00 AM EDT
Lots of wine aficionados fall in love with the notion of owning a vineyard or winery. But adding a vineyard to your list of assets is about a lot more than pursuing a passion for the grape. Like any other business, this one takes hard work and lots of cash as well as patience, determination, and—did we mention—lots of cash.
There’s something about the idea of winemaking that often turns otherwise sensible business people into dreamers who want nothing more than to see their name on a wine label. Yet as intoxicating as that notion can be, you need to ask yourself several essential questions. How much do you really know about the winemaking business? Can you pursue this dream without endangering your other financial goals? And do you intend it to be a hobby or a business? (That last distinction can have tax implications.)
Becoming a winemaker tends to be pricey. According to Terry Pershall, a real estate agent and former wine industry professional in Santa Cruz, California, who has matched vineyard buyers and sellers, the going rate for California vineyards ranges from $1.2 million to $50 million. A recent Paso Robles, California newspaper ad offered 50 acres of working vineyard and winery plus a four-bedroom estate home, separate office, assorted storage buildings, and wine inventory for $1.8 million. In another ad, a 4.5 acre “custom” winery and vineyard in the Santa Cruz mountain foothills included a home, winery facilities, equipment, tasting room, cave site, expansion permits, and vineyard for $3.85 million. Trade publication Wine Business Monthly (winebusiness.com) lists wineries for sale across the world.
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