Vineyard values at plateau: expert
Some Marlborough vineyard values are nudging levels last seen in 2007 just before the global financial crash, but a local expert says they have reached a plateau.
Bayleys’ Kurt Lindsay said that in the main Wairau Valley growing area the average price per hectare of sauvignon blanc vineyards was between $225,000 to $275,000 a hectare – slightly below the $300,000/ha of the inflated 2007 era.
Lindsay said today’s more realistic prices were driven by the price of grapes, currently $1779 a tonne compared with last year’s $1750, and affected by labour and management costs.
"There’s still some new development going on but prices are cooling a little and the word around the market is they won’t be going up in a hurry,’’ Lindsay said.
Development potential of land up the Wairau and Awatere valleys was restricted, so most of his sellers were people who wanted to retire after 25 or more years or more in the industry.
They were taking advantage of the relatively buoyant market for wine as reflected in the recovery of land values in recent years, he said, and some buyers were looking for a lifestyle change.
Property records show two recent buyers were Richard and Sharon Crowe who have been dairy farmers at Rakaia and recently bought a 51ha vineyard at 75 Pembers Rd, Tua Marina for $11.3m.
Other dairy farmers have also focused on viticulture for ‘‘income and lifestyle.’’
Most recent sales have been smaller properties valued between $2m and $5m and more popular with ‘‘Mum and Dad’’ investors, Lindsay said.
‘‘Some corporates have been buying up the Wairau Valley where they’ve been looking to develop bare land blocks but it becomes marginal when you get 50 kilometres inland because of altitude and temperature.’’
One of the larger investments recently was the NZ Super Fund’s acquisition of the 200ha Altimarloch vineyard inland along the Awatere Valley for $33m.
It was the only viticulture property in the NZ Super Fund rural land portfolio valued at about $500m and including 22 dairy farms.
Another recent large deal was the expansion of Raparua Springs Wines with the purchase of a 365ha property with nearly half of it planted in sauvignon.
‘‘The emphasis is still on sauvignon-growing properties with minor varieties like pinot gris and pinot noir for making rose. And chardonnay always remains popular,’’ Lindsay said.
There were more than 25,000ha of planted vineyards in Marlborough where most sauvignon blanc is grown for export. Sauvignon blanc accounts for 86 per cent of New Zealand’s annual wine exports.
Some recent Marlborough property sales include –
❚ 57 Selmes Rd, Rapaura, 7.6ha sauvignon vineyard for $3.3m
❚ 75 Barewood Rd, Seddon, 32ha, half planted in sauvignon, $3.8m
❚ 11 Nolans Rd, Grovetown, 8ha, half planted in mixed variety, $2m
❚ Cnr Hawkesbury Rd and Kennedy’s Rd, Fairhall, 65ha, 45ha planted in mixed variety, winery and stock included, $13m.
Lindsay said prices were generally higher if the sale included the crop.
‘‘As you move further out from the central areas such as Rapaura the land prices are less per hectare. It also depends on irrigation, frost risk, availability of labour, and distance to main viticultural services,’’ Lindsay said.