Vineyard values plateau near pre-GFC levels: agent
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.
Kurt Lindsay, a viticulture sales specialist with Bayleys, said that in the main Wairau Valley growing area the average price per hectare of sauvignon blanc vineyards was between $225,000 and $275,000 – 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 were also 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 Rakaia dairy farmers. They bought a 51ha vineyard at 75 Pembers Rd, Tua Marina, for $11.3 million.
Other dairy farmers have also turned to a focus on viticulture for ‘‘income and lifestyle’’.
The most recent sales have been smaller properties valued between $2m and $5m. These were 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 New Zealand Superannuation 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’s rural land portfolio, which is valued at about $500m and includes 22 dairy farms.
Another recent large deal was the expansion of Raparua Springs Wines with the purchase of a 365ha property, nearly half of which was 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. 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,’’ he said.