With more than 123,000 hectares, the Bordeaux vineyards are the largest vine region in the world. Amongst the 10,000 châteaux dotted around this area, one can find vineyards which produce some of the most renowned and splendid wines. The diversity of this land’s soil and climate enable the production of a great variety of wines: red, rosé, both dry and sweet white. All in all, the Bordeaux vineyards produce 55 of the big wine names.
On average, the Bordeaux vineyards sell 700 million bottles to 160 countries each year. In the Gironde area, 89% of the wines sold are red and rosé, and 16% are white. The UK is still the biggest buyer of French wine, ahead of the USA, Germany, Belgium and Japan.
Daniel, our French Entrée estate partner in the Gironde, says that vineyards come up for sale for all kinds of reasons. It could be that the owners want to retire, or the children who have inherited the vineyards are not wishing to continue, or succession problems with businesses which have been passed down from generation to generation.
“The price of a vineyard will depend on a number of factors, says Daniel, “including the label of the wine produced”. Fifty-five percent of the vineyards in the Gironde produce Bordeaux or Bordeaux Superior wines. As an indication the following are the prices, on average, per hectare, for some of the different types of wine produced in the Gironde: Bordeaux wines – €20,000; Médoc wines – €40,000; Saint Emilion wines – €230,000 (though these can also range from anywhere between €100,000 and €600,000). The most expensive vineyards produce the Pomerol wines and the price per hectare for such vines can cost anything from €600,000 to €1,800,000 for the very prestigious.
“Before pricing a vineyard,” says Daniel, “estate agents also examine: the grape variety, the age of the vines, maintenance, spacing of plants and rows, the percentage of missing plants, the configuration of plots, the effluent treatment, the condition of the château, buildings, and production facilities and equipment. All of these elements will determine the potential of the property and its value.”
Investors looking to buy a vineyard should look at the natural elements which cannot be changed, such as soil, subsoil, microclimate and exposure. A vineyard will not produce the same quality of grapes if it is situated on plateaux or on a hillside.
A vigneron (wine maker) takes great pride in people tasting their wines, yet 60% of vignerons are not professional wine specialists. Buyers vary from companies or investors wanting to diversify their investment portfolio to wine lovers who have had a career change and young retirees who have previously run a business and want to remain active in their retirement. Although you do not need any professional qualifications to run a vineyard, you will need one person to work on every 15 hectares and an oenologist (wine specialist) to advise on soil, grapes and method.
A wine merchant will make considerably more money if they bottle and label the wine themselves before selling it. Some vineyard owners sell their wine by the barrel, which will then be bottled and labelled by an intermediary. The following is a comparative example of the production costs and profit made from producing wine by the bottle and by the barrel:
One barrel of Bordeaux wine (about 900 litres) which will produce about 1,200 bottles of Bordeaux is sold for €1,000, which represents about €0.83 per bottle.
For those bottling the wine themselves, the packaging costs need to be accounted for. The price of bottles, stickers and corks represents about €0.80 per bottle. If you were to sell the wine for €4.00 per bottle, once the €0.80 packaging cost is deducted, you are left with a profit of €3.20 per bottle.
How much money a vineyard produces depends on the type and amount of wine produced. For example if a producer of Bordeaux wine produced 5,300 litres per hectare of wine, which equates to about 6,500 bottles (when taking the above barrels versus bottles equations into account), selling this quantity in barrels would make a €5,888 profit per hectare, while if selling it in bottles, a €15,405 profit (including all production and commercial costs) would be made. Wine making can be both a profitable and rewarding business venture.
Take a look at this list of vineyards for sale.
For further information about any of the above properties or for help with your property search, please call our consultant at +44 (0)1225 463 752 or email firstname.lastname@example.org or contact one of our local property finders with expert knowledge of the area.
•With thanks to Nina Richards and Daniel in the Gironde