Wines & Vines Home
   
 
Welcome Guest
LOGIN |  CREATE ACCOUNT
 
ADVERTISEMENT
 
 
 
10.23.2008  
 

Horse Heaven Vineyard Goes to Gavel

Nearly 700 acres to be auctioned in one of Washington's most expensive grapegrowing neighborhoods

 
by Peter Mitham
 
 
Horse Heaven Hills AVA
 
 
Prosser, Wash. -- A property owner in Washington state plans to offer approximately 680 acres in the Horse Heaven Hills AVA at an auction Nov. 6. J.P. King Auction Co. of Gadsden, Ala., is handling the sale, which includes the 220-acre Alder Creek Vineyard (aldercreekvineyard.com) and the 460-acre Windy Ridge Vineyard (windyridgevineyard.com). The properties have been subdivided into 19 smaller parcels ranging in size from 20 to 80 acres.

Auction documents state that up to 445 acres of vineyard are possible on the properties near Mabton, Wash., which currently have just 265 acres of vines. Varieties planted include Cabernet Sauvignon, Merlot, Syrah, Cabernet Franc, Petit Verdot, Malbec, Sangiovese and Sauvignon Blanc. Approximately 45 wineries from across the Pacific Northwest and as far away as Nebraska buy the fruit from these parcels.

REGION: NORTHWEST

View Larger Map
Horse Heaven Hills AVA
 
Selling to reduce debt

Despite strong demand for the grapes, managing owner David Groth told Wines & Vines that he's selling the properties to reduce debt and fund a planned conference and retreat center adjacent to the Groths' Canyon's Edge Winery (canyonsedgewinery.com). Changes in financing conditions since Groth began planning for the project last year mean a greater requirement for up-front capital.

The $10-million project will include meeting facilities, approximately 12 cabins and a custom-crush facility serving local growers. As a model, Groth points to the Wine Loft in Prosser, where seven different wineries operate with individual tasting rooms but use common equipment.

"It gets a person into it, and the lifestyle, for far less than what it would take them to go out and spend $1 million on their own to go and set up a facility," Groth said.

Groth himself will retain 700 acres following the sale, providing enough land for approximately 100 acres of vines to supply Canyon's Edge, as well as up to 200 acres of production for other wineries. "I've got contracts coming out my ears for the fruit. And, in fact, I could have planted another 400 acres this year just to try to meet the contracts," he said.

Several of Groth's current purchasers have requested information on buying parcels Nov. 6, given the rarity of the offering and the desire to secure a supply of grapes from the area. "We have a reputation of very high-quality fruit coming out of here," Groth said. "They want a site, they want to buy into it so they can…continue to have fruit from here."

Horse Heaven Hills AVA
 
 
Demand for local grapes is strong

The Horse Heaven Hills AVA was established in 2005, but the wine industry's roots in the area go back to the early 1970s. Horse Heaven vineyards supply about 30 percent of Washington state's grapes, including some of the most expensive lots. Consistent weather ensures that hang times are longer than in areas such as Walla Walla. Alder Creek, for example, hasn't yet had frost, which touched vineyards in Walla Walla earlier this month.

Demand for the area's fruit is matched by interest in vineyard land. Leucadia National Corp., owner of the Crimson Wine Group, which has properties in Napa and the Willamette Valley, bought 611 acres in the Horse Heaven Hills in 2005 and 2006. The $3.3 million price averages out to about $5,400 an acre, a figure that may seem low but represents the aggregate value of bare land not all of which will become vineyard.

The highest price paid for a vineyard in the AVA -- and one of the highest in Washington state, for that matter -- was set when a group led by Allen Shoup of Long Shadows Vintners in Walla Walla bought Wallula Vineyards from the den Hoed family earlier this year. Shoup's group paid just under $50,000 an acre for the 650-acre property on the eastern edge of the AVA.

With a piece near the Champoux vineyard selling for $44,500 an acre last year, Groth expects to see good bids on his parcels. Brokers such as Don McDermott of John L. Scott Real Estate in the Columbia Gorge (also a vineyard owner) are pegging current prices of planted vineyards at $30,000 an acre and bare land at $10,000 an acre. Still, while agricultural properties have been holding their own despite a general downturn in real estate, J.P. King president Craig King notes that the auction won't be a cakewalk. Smaller parcels promise to open up the bidding to more buyers, however.

"We wanted to offer some smaller parcels where maybe someone wants to come in and they want to buy 50 acres and operate a smaller vineyard without taking on the entire project," King said. "There are plenty of buyers who ca n absorb and buy this entire property, but there are a whole lot more buyers who can buy a part of it."

Broadening the market will not only help attract more bidders, King said, it promises to boost the value of the property to Groth because proceeds from the sale of individual parcels is likely to be more than a single, large property would fetch. That also stands to protect Groth from any downturn in real estate values.

"We're better because we broaden the market," King said. "In today's market, we're having to be more creative in order to get the same prices that we were getting a year or two years ago."

Viewings of the property start Oct. 27 and continue through Nov. 6.
SHARE »
Close
LATEST READER COMMENTS
 
 
Posted on 10.24.2008 - 08:14:34 PST
 
Interesting article, with two gross inaccuracies. The Red Mountain AVA, est. in 2001, has the most expensive vineyard land in Washington State. The sale last year of Red Mt. Vineyard/Sandhill for about $73,000/planted acre far exceeds that in your article.
 
tom
 
Benton City, WA USA
 

 
Posted on 10.24.2008 - 20:30:54 PST
 
Didn't Sandhill's sale include a winery? If so, it would throw off the cost per acre Tom quoted.
 
Jeff
 
Renton, WA USA
 

 
Posted on 10.24.2008 - 08:54:50 PST
 
Tom: Thanks for the heads up. We are double-checking and will make any corrections needed.
 
Jim Gordon
 
Napa, CA USA
 

 
Posted on 10.24.2008 - 12:45:52 PST
 
Thanks for the comment, Tom. Tracking vineyard sales, many of which are private, isn't easy. Many parties prefer to keep prices and terms quiet. Red Mountain is a desireable AVA but in researching this item, Sandhill did not feature in any of the published sources I consulted or during interviews -- so your information is welcome. I'll be taking a closer look at vineyard sales in Washington State for a future article, and would appreciate hearing what readers in the state's various AVAs are hearing, and seeing. Those who wish to share information for that purpose can contact me at pmitham(at)telus.net.
 
Peter Mitham
 
Vancouver, BC Canada
 
 
CURRENT NEWS INDEX »


 
Wines & Vines Home
 
866.453.9701 | 415.453.9700 | Fax: 415.453.2517
65 Mitchell Blvd., Ste. A San Rafael, CA 94903
info@winesandvines.com
Wine Industry Metrics
 
Off-Premise Sales » Month   12 Months  
August 2014 $558 million
5%
$7,613 million
6%
August 2013 $531 million $7,167 million
     
Direct-to-Consumer Shipments » Month   12 Months  
August 2014 $78 million
17%
$1,686 million
10%
August 2013 $67 million $1,530 million
     
Winery Job Index » Month   12 Months  
August 2014 218
12%
224
19%
August 2013 194 189
     
 
MORE » Released on 09.15.2014
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Practical Winery & Vineyard Library
 
Search the PWV archive »
 
 

Direct To Consumer
Wine Shipping Report
2014
 
Download full report »
 
 

CALENDAR
  • September 18-21
     
    Euphoria
     
  • September 22-23
     
    Wine Industry Financial Symposium
     
  • September 23-24
     
    Experimental Design and Chemometrics for Chemists
     
  • September 27
     
    Red Mountain AVA Block Party
     
  • MORE »
 

READER COMMENTS
 
Article: New York OKs Out-of-State Grapes »
 
If the resultant wine, using out of state juice,bears the "American" on the label, I...
Reader: Guest
 
Article: Financial Impact of Napa Quake Rising »
 
I still think the numbers are low and don't include legal fees. Section 165 was...
Reader: Guest
 
Article: Tasting the Effects of Wine Closures »
 
In addition to oxidation of somee of the SO2, post-bottling chemical changes are a continuation...
Reader: Guest
 
Article: Tasting the Effects of Wine Closures »
 
I agree with the 14:46 post. I have switched to screwcap on most of my...
Reader: Chris Baker
 
Article: Tasting the Effects of Wine Closures »
 
What I have found in the past between the type of closures is this. A)...
Reader: Guest
 
 


Directory/Buyer's Guide — Your Wine Industry Marketplace
 
 
WINERY SEARCH
 
 
Advanced Search »
SUPPLIER SEARCH
   by Product
 by Company Name or Brand
 
Browse by Category »
2014 Directory/Buyer's Guide
The Wines & Vines Directory and Buyer's Guide
 
 
EXPANDED ONLINE SEARCH INCLUDED WITH PURCHASE
 
ORDER NOW »
 
LEARN MORE »
 
 
Wines & Vines Magazine
 
 
LEARN MORE »
 
SUBSCRIBE »
 
Digital Edition Now Available!
Wines & Vines Digital Edition Now Available
 
LEARN MORE »
 
ORDER NOW »
 
 
The Wines & Vines Online Marketing System
 
The Industry Standard winery marketing application
 
FREE LIVE DEMO »
 
VIEW VIDEO »
 
 
 
 
Latest Job Listings
 Tasting Room/Events Ma...
 Sebastopol, CA
DTC, Tasting Room and Retai
 Senior Wine Account Re...
 Houston, TX
Sales and Marketing
 Associate Marketing Ma...
 Napa, CA
Sales and Marketing
 Wine Pourer
 Livermore, CA
DTC, Tasting Room and Retai
 Account Specialist: On...
 New York & New Jersey, NY
Sales and Marketing
 Staff Accountant
 Guerneville, CA
Finance
 G/L Accountant
 Napa, CA
Finance
 Cellar Worker
 Santa Rosa, CA
Winemaking and Production
 Wine Steward/Merchandi...
 San Jose, CA
Sales and Marketing
 Pt - Tasting Room Asso...
 Newberg, OR
DTC, Tasting Room and Retai
 
More Job Listings >>
Follow Us On:
 
 





Home  |  About Us  |  Editors  |  Subscribe  |  Print Edition  |  Digital Edition

Advertise  |  Site Map  |  Contact Us  |  Privacy Policy
 
 
Copyright © 2001-2014 by Wine Communications Group, Inc. All Rights Reserved.
No material may be reproduced without written permission of the Publisher.
Wines&Vines does not assume any responsibility for any unsolicited manuscripts or materials.