Do you want to buy a vineyard and want to know the cost? If YES, here is an estimate of how much it cost to buy a vineyard and steps to follow to buy one.
The idea of having a two-story house perched atop a hill overlooking a vineyard full of ripening fruits is the stuff of dreams, and imagine yourself standing at the balcony while the wind wafts the delicious aroma of ripening grapes to you. This is the dream of a whole lot of people and a very expensive one at that.
Owning a vineyard not only comes with the above scenario, but it also has a status symbol attached to it. But for you to own one of these coveted pieces of land and bring it up to par, it will take you long suffering, dedication and a whole lot of money.
If you really want to know what it will cost you to own a vineyard, or you are just curious about the figures, we are going to break it down for you.
Estimated Cost to Buy a Vineyard
The cost of land for growing grapes varies by both its quality and the price that can be fetched for the grapes in that region.
When buying a vineyard, have it in mind that you would have to spend a lot of money before you start reaping from the property. This is because vines take years to mature and fruit, and it equally takes a lot of time to produce your favorite wine.
Table of Content
Cost of Buying a Vineyard in the United States
Kevin Kinsella, the founder of the venture capital firm Avalon Ventures, bought a vineyard in Healdsburg, Calif., in 2007. He paid $2.8 million for 75 acres, 12 of them planted with grapes. He now produces a top-ranked cabernet sauvignon on his Kinsella Estates. It sells for $125 a bottle.
He made some additional investment, including replanting 10 acres where the vines were past their prime. That generally costs $75,000 to $100,000 an acre,.
A vineyard brokerage firm said land in Napa was the most expensive since much of the farmable acreage had been planted. These properties can cost between $400,000 to $500,000 an acre. In the Central Coast, the price is $150,000 an acre. Land with pinot noir grapes in Santa Barbara, costs $80,000 an acre.
In Oregon, the cost is about $35,000 an acre, while in New Zealand, it’s about $20,000 an acre. The driving cost of the land is the price of the grapes. Grapes grown in Napa fetch $10,000 a ton, while pinot noir grapes in Oregon sell for just $3,000 a ton. In the Central Valley, which is the core producer for mass-market wines, the grapes are $500 to $800 a ton.
Cost of Buying a Vineyard in France
France being a centralized country that is keen on agricultural control, has an organization, La Safer, that tracks all vineyard transactions and publishes annual statistics. The latest numbers were released recently.
If you want to buy a vineyard in France you can count on the average price being, according to the 2014 statistics, 136,400 euro per hectare for appellation land. That is $61,000 for an acre. “Appellation land”, technically speaking “AOP” land, refers to the French classification for recognized wine regions where appellation is the most prestigious category.
If you want a land that is not in the AOP category you can get away with an average of 12,700 euros per hectare ($5,700 per acre).
Accordingly, the prices for land vary enormously in France with the fame of the appellation. It is no surprise that the most expensive wine region is Champagne, where you will have to splash out a not insignificant 1.1 million euro per hectare (just under $500,000 per acre) on average.
7 Steps on How to Buy a Good Vineyard at an Affordable Price
Several facts come into play when it comes to buying a vineyard. This is not just like buying an ordinary piece of land or a house. Here, you need to consider the land, location, types of grapes planted on the land (because government would rarely sell you a virgin land to use for a vineyard) and then yield.
Get a feel of the land
Vineyard land or vineyard potential land is not all the same. For this reason, you need to find out certain things and answer a few questions. You should find out the type of grapes you want: table grapes, juice grapes or wine grapes? If it is wine grapes, of which variety?
Does the property have irrigation water, and is there enough water for a sustainable crop? Is there a slope or is it flat land? If the land is flat, then one needs to do substantially more research before committing.
Land with a slope (even in any direction) allows for natural air drainage—either up or down the hillside. If there are undulations in the land (hills and valleys) there could be cold pockets subjecting spring bloom to potential frost pockets. You need to find out these things if you want to make a good buy.
2. The grapes are important
Juice grapes are generally tougher than wine grapes or table grapes. Their growing season is short thus allowing them to be grown in nearly every northern state in the U.S. Table grapes have both a longer growing season and a tender blossom.
They are grown a bit mid-line across the US to the more southern areas. Both of these varieties strive for high production and quantity, needing substantial water for finishing.
Wine grapes, on the other hand, are much more temperamental. They need some water, but not too much. There is a very fine line between not enough and too much water for irrigation. A smaller berry, starved slightly for water, produces a better quality wine in the end.
Slopes are nearly always preferred for wine grapes, regardless of variety. Red varietals can take colder winters than the whites and are more susceptible to some diseases. Having details of the grapes you want to plant would enable you make good land choice.
3. Is the climate favorable for what you have in mind?
When buying a vineyard, another thing you have to take note of is the local weather patterns, spring and fall freeze dates and frost-free growing days.
Also, take note of the types of crops grown in the surrounding area. Know the standards of practice for spray application to the neighboring lands. Grapes are very much negatively affected by certain sprays, causing bloom drop and loss of production. Bees are an important factor to consider as well.
Grapes do very well in areas where orchards and nut groves are prevalent for pollination. The bees tend to linger longer where there is ample blossom time and fresh nectar.
4. Know the soils
Next, you have to take a look at the soils. Vines do not like to dwell on soggy soils, so well-drained soils are a major factor.
Have the soils tested for nutrients as a part of your ‘due diligence’ prior to closing the sale. Know and understand the nutritional needs of your chosen varieties, and if the soils need amending to reach the plant requirements, find out what the cost will be to reach that goal.
You may determine that a nicer looking property may cost you more than your second choice if the cost to get the soils amended to optimum levels is cost prohibitive. Find a crop consultant in the area who specializes in grape production to help you with your research. Always look for local, regional or state grower associations for advice and/or assistance.
5. Get a financial plan
Finances is one of the most frequently miscalculated and misguided parts of the farming business in general. Vineyards do not produce the first year, or the second year, and possibly not even the third year. Know the cost of trellising, planting, pruning and training the vines before production.
Determine if hand picking or mechanical harvest will be done. If you are not sure, plan for both. Height, row spacing and end-row turnaround space are critical. Plan out plantings in phases so that you can optimize the land and the expense calendar.
Order the vines from a reputable nursery. Always ensure that you ask for the patent and copyright certificate for the vines you purchase.
If the nursery says they don’t have one or that you don’t need one, go elsewhere. Permanent plants are patented and copyrighted just like photographs, parts and paintings, and there are substantial fines and penalties associated with ‘patent infringement’ in America. It is also against the law to make cuttings of patented plants for expanding your own growing area.
6. Know what sells
Before you finally make your choice, know the varieties of grapes and the demand. Remember, the public changes flavor trends often and suddenly. Reds are always popular; however, popular taste may vary from light to heavy, oaky to clear, and whatever other flavors can arise in the process of fermentation.
Whites can vary widely from dry to sweet; there are cooking varieties, sipping varieties, and dessert and aperitif whites. It is important to know the market, the demand, and watch the industry trends before getting financially buried in the vineyard business.
7. Reach out to other growers
Get to know the other growers and vintners in the area. They will be your biggest resource and greatest fans. Wine growers, unlike hop growers, are extremely generous with sharing information about practices, operations and what’s new.
The vineyard business isn’t for anyone who needs a quick turnaround. It will feel much like working for free for over a decade. From studies, it has proven that it can take you between 11 and 13 years to start making good profit from your wine production.
During that time, the stages you have to go through will include planning, grooming and developing your vineyard, producing grapes, and executing your marketing strategy.