Wine & Vineyard

When working with investors looking at properties in wine country, the first question our advisors ask is, “Are you looking for a private estate with a vineyard onsite, or are you searching for a fully operational winery?” The difference between these two types of properties is stark.

What is a vineyard?

Vineyards can be smaller estates centered around a family home or residence, or a larger commercially scaled vineyard with a lesser home. The grapes produced may be used in service of the family’s private wine label or can be sold to a larger winery(ies). Vineyard owners with their own wine brand often have a small production (200 cases or fewer) with distribution via a wine club or local “Direct-To-Consumer” sales. Rarely will a smaller wine brand offer wines through their own private tasting room or other hospitality elements.

What is a winery?

A winery is very much a commercial operation centered around the production and sale of wine. While a residence may be present on the grounds, the focal point of the property is on the operational buildings, cellars, tasting room, vineyards, and other consumer-facing areas.

“Vineyards have a broader appeal, because they can be a more passive investment with a nice payoff. Those who are interested in buying a winery usually know exactly what they want to create, either in terms of a certain brand or a certain kind of wine.” 

— Richard Deacon, Private Office Advisor, Okanagan, British Columbia

Clients who purchase vineyards tend to be interested in a more passive investment that manages risk but yields returns beyond financial ones.

Prior to the purchase, savvy vineyard buyers will formulate a plan and a team to handle the agricultural and production sides of their ownership interest. Depending on the specific niche of the wine program, purchasers may hire staff or use a local co-op system to farm the land and produce wine on behalf of the family, or they may hire third party professionals to perform all aspects of the operations. Other buyers choose to simply lease the land to a winery for a fully hands-off experience.

In addition to assisting with this key decision, our Private Office vineyard specialists introduce purchasers to other critical resources, including:

• Mortgage or financing experts

• Development Specialists

• Vineyard Management Specialists

• Winemaking professionals

• Caretakers and property managers

• Soil, land and water specialists

• Local contacts, including schools and tutors, if needed

"My clients are primarily looking for a lifestyle change.They buy a smaller estate where they can enjoy a quiet weekend away, and the wine or olive oil is a byproduct or bonus of that investment.” 

— Annalisa Caparelli, Private Office Advisor, Siena, Italy

Some current vineyard owners, as well as some potential owners, wish to explore the value of sharing their idyllic vineyard lifestyle through limited, sensitively integrated residential development. In these instances Engel & Völkers development specialists may be tapped to apply their experience in conducting this kind of highly specialized and comprehensive analysis.

Wineries may be a lifestyle investment for some, but they are also a complex business that requires a broad range of expertise, from agriculture to hospitality, to marketing and sales, to wine production and distribution.

Private office advisors will work with both the purchaser and their staff to understand the totality of their investment, which — in addition to the land — may include:

• An on-site residence

• Vineyards, wells, septic systems, reservoirs

• Production buildings, equipment, and materials

• Hospitality buildings, including tasting rooms or restaurants

• Existing inventory of wine

• Wine clubs and other customer connection points

• Distribution models and agreements

“Even if the purchaser plans to one day be more involved in the day-to-day operations, they usually recognize that they need to get started by outsourcing the entire operation. As long-time specialists in the area, we have the best relationships they need to get started.”

— Will Densberger, Private Office Advisor, Napa Valley

Depending on their background, investors may need a “crash course” in winery operations. Our private office advisors can facilitate conversations between the owners and leading experts — from civil engineers, soil experts and development experts to vineyard managers and the top winemakers — to help them understand many of the challenges, decisions and opportunities related to their investment.

“When working with vineyards, it can very quickly creep from a residential sale to a commercial sale. A buyer may be purchasing the land and residence, but with that also comes inventory, equipment and outbuildings. It’s the sale of a business, so you may also have to factor in the cost of the brand itself.”

— Richard Deacon, Private Office Advisor, Okanagan, British Columbia

When it comes to selling an operational winery, finding and vetting a buyer is not a fast, linear process. Still, Densberger and his partner, Pavi Micheli, did share the basic steps they follow when selling a winery:

1. Begin interviewing potential buyers but maintain anonymity of the asset and brand.

2. Ask each buyer for their top criteria, to ensure goals and objectives align.

3. Verify the financial capacity of prospective buyers.

4. Speak with the winery owner about the buyer and their potential alignment.

5. If the vineyard owner wishes to proceed with discussion, the buyer will be asked to sign a non-disclosure agreement.

6. Set up an off-site meeting with both parties, where they can have their first conversation. The buyer may request to taste the wine and understand the philosophy of the program.

7. If the buyer and seller are both still interested, negotiations begin.

“When we typically first meet with an owner, they don’t want to disrupt operations; they need to preserve relationships with key employees and avoid distribution and distractions to their wine club members. Speaking with us at all is an extremely sensitive matter, and we take the client's trust in us very seriously.” 

— Pavi Micheli, Private Office Advisor, Napa Valley

For wine and vineyard experts, networking is not typically a buttoned-up happy hour replete with name tags and awkward introductions. Instead, these specialists are so embedded in this world that they tend to make natural connections with local and international contacts over the course of years and even decades.

Densberger explains, “Pavi and I are so involved in the Napa wine scene that we are essentially networking all the time. We’re frequently viewed as a concierge service in the Valley. Often, our deals naturally evolve as we uncover the alignment of interests. If you’ve got something to do with wine, or want to get involved, we probably know of an opportunity that you should pursue.”

While some families do not become personally involved in the day-to-day operations of their vineyard or winery, most do tend to find a richer connection to Wine Country, say our vineyard specialists.

Some families are surprised to see how much owning such a property changes them, said vineyard sales specialist Ben Wolhuter from Stellenbosch, South Africa. “While the vineyard and property will take on the owner’s character,” he explains, “it will also shape their character in return.”

Annalisa Caparelli, of the Siena region in Italy, agrees. She mentions that upon meeting her clients, many of them are busy, stressed and living in service to their email. As they settle in, though, things change.

“Time starts to flow more slowly and they learn to appreciate the season, the smell of the country, the taste of the wine. And then they make their first bottle of wine. Maybe it cost them a thousand dollars to make this very first bottle, but there is such pride. They know and see, their new life is in this bottle.” 

— Annalisa Caparelli, Private Office Advisor, Siena, Italy

For Family Office clients pursuing wineries in Napa Valley, Micheli and Densberger admit that profitability is top of mind. But legacy is not far behind. For Densberger, who grew up in Napa Valley, the most rewarding part of his work comes when his clients become deeply embedded in the unique culture and community of the area.

“Napa represents the best of America: it has the appeal of a small town, and unparalleled opportunity. This place is filled with incredible stories, if you slow down and take it all in. What’s wonderful about the Family Office encounter is that there is time to help them see what makes this place so special — and they can become part of the story, as well. Because Napa Valley is like nowhere else in the world.”

Visit Featured Properties to view the vineyards, wineries and wine-related properties currently on the market with our advisors. To access off-market opportunities from the world of wine, please contact us or an expert advisor in your area.