Newsletter

Moving Forward – Sonoma and Napa Real Estate 2020

Moving Forward, One Step At A Time

Greetings, wine country friends.  I hope you are enjoying spring and making the most of these strange times.  Clearly, we are enduring an unprecedented challenge with Covid-19 health issues and associated economic impact.    As a community I am sure we will ultimately arrive at a   destination that resembles the wine country that we all know and love.  Let’s take a look at Sonoma and Napa real estate 2020.

Until then, we have to work through what is directly in front of us.  On the good news front, wine sales are up, way up.  Mostly for lower priced wine but it is still helping put a dent in some of the surplus we have encountered in the last couple of years.  Additionally, there are a few great deals on higher quality wine if you know where to find them.  A helpful assist in these challenging times

sonoma pinot noir vineyard sold

Sonoma Pinot Noir Vineyard & Estate Building Site

Green Acres Is The Place To Be

Interest in “country” property / wine country property has seen an uptick lately.   One could call it the Corona effect but I prefer to call it “Green Acres”.  After years of society moving to more clustered, high density living spaces in cities, some are reassessing whether they need more space.  Locally, in the Bay Area, that means people are considering wine country more than they did just six months ago.  Will that translate into a definitive trend or just a blip?  We do not know for sure, but it is something to keep an eye on.

For Vintroux Real Estate it has been an interesting year.  Numerous small winery and vineyard transactions have kept me busy.   Since the lockdown I have been doing what real estate related work can be done, as well as built a fence, planted numerous plants, did a ton of tree work, cooked a lot, drank a bit, read a couple books… tried to avoid social media nonsense, so on and so forth.  But now as we are start to get things moving again, it is time to reactivate the market.  Let’s take a look at the market now.

Wine Country Real Estate / Vineyard Values

An obvious question is how the Covid-19 situation impacts real estate.  In wine country this question is combined with the current oversupply of wine grapes.  Together, how do these two factors impact value?

First, the same time tested rule applies:  Blue Chip properties will fare better than average or below average properties.  This means that the super premium properties and vineyards of the Napa Valley and Sonoma County will likely see little change in their value.  The grapes are still coveted, the locations are desired and those with resources will continue to make decisions that suit their interests.   Second, average properties that maintain contracts will likely have some softening but not necessarily a precipitous drop in value.  Finally, properties and vineyards that do not have contracts will have a tougher time justifying the status quo… unless there is a strong lifestyle component.

Vineyard values in Napa Valley can range anywhere from $150,000 /acre to $500,000++ / acre.  In Sonoma County the values range from $75,000 / acre to $200,000 / acre.

Wine Grape Prices

Wine grape prices have a direct impact on vineyards.  As we all know, we are more than a year into the oversupply of the grape cycle.  This is a chart of current average grape prices in Napa and Sonoma Counties.

2019 Sonoma & Napa Wine Grape Prices

2019 Sonoma & Napa Wine Grape Prices

Click Here to See a Chart Comparing Wine Grape Sales For the Last Several Years

The Full Grape Crush Report Can Be Found Here

It is important to keep in mind that this information only relates to grapes sold under contract.  This does not reflect vineyards that had to drop their fruit, sell on the spot market or did not sell at all.  In other words, this chart does not reflect the true wine grape market but it is helpful.

Another popular question:  What is my winery worth?

During these challenging times many are curious about the value of their winery.   Well, I can tell you that having sold multiple wineries in the last year there is interest.

sold wineries

Buyers come to the market with several drivers including passion, business fundamentals and future potential.  It is important for Sellers to be realistic with respect to what they are offering.  Wineries have many moving parts, so this type of transaction is not for the faint of heart.  To get a fact based assessment of market value, it is important to work with professionals who have intimate knowledge and experience in the wine business.  This helps avoid surprises and can even improve the business presentation.  I have partnered with Triumph Advisors to help Sellers prepare for a sale and Buyers enter the business.  They provide a full array of the following advisory services for small to mid-sized wineries up to 200k cases.

Practical and effective expertise in the core competency areas of a winery business:  Production, Finance, Sales, Marketing and DTC.

  • Business Model, Scale & Performance Evaluations
  • Strategic Planning & Development
  • Management Services – CEO/CFO/CMO/CSO for hire 

So, where does this leave us?

Great question!  We still have to work through the oversupply and prices will likely soften in some areas.  My experience says that there continues to be activity, transactions will take place and people with resources (lifestyle and wine industry) are going to proceed with decisions that fit their needs.  We keep moving forward.

If you would like to discuss your property, we can set up a telephone call, a video conference or even an in person meeting (physical distancing, of course).  Things may look a little different right now but that does not mean deals can not get done.

Cheers!

David Ashcraft

Click Here For PDF Version

Next Newsletter

Previous Newsletter

Some additional articles that might be helpful:

What is a vineyard really worth?  It depends.

Wine Country Real Estate Building Blocks

Looking to Buy A Winery, Start Here

So where exactly is wine country?

Buying a Vineyard?  A short course to the basics.

Which AVA came first?

If you are serious about your wine country search, please contact us today.  Last but least, here is link to more local resources.

Vineyard and Winery Real Estate Update Napa and Sonoma

Real estate is a funny thing.  In tight markets with low inventory, the whisper is, everything is for sale… for the right price.  Here’s the thing, in bad markets, everything is for sale too… but for different reasons. As we move past the middle of 2024 it is a good time to look at vineyard, […]... Read more

Wine Country Real Estate Market in 2024

We are looking at a bifurcated wine country real estate market in 2024.  A stronger economy along with improving interest rates generally bodes well for real estate.  In contrast, the wine industry is struggling.... Read more

Wine Country Real Estate Update Summer 2023

Happy August!  A cooler than average growing season after major winter rains has been a welcome pattern this summer.  I hope you have been soaking it up.  On the real estate front the market has several competing variables creating an interesting dynamic to say the least.  It is time for the wine country real estate […]... Read more

Buying A Vineyard

Before You Take The Plunge In Buying A Vineyard - Ask yourself: why am I buying a vineyard? This may seem like an obvious question but the answer could lead you in numerous directions not yet considered. What’s the driver? Are you looking for lifestyle? Are you looking to create the next super premium Cabernet, Pinot Noir or Chardonnay? Are you going to be hands off or do you want to be out in field getting dirt under your nails? Let's take a quick look at some things you should consider.... Read more

Green Shoots in 2023, and Which AVA Came First?

Winter 2023 First things first, Happy 2023!  Another year to enjoy this beautiful area we call home.  With more than two decades of selling wine country real estate, I am still in awe of our backyard.  The dynamic landscape is a constant reminder of the amazing diversity throughout Sonoma and Napa Counties, from the Pacific […]... Read more

Napa and Sonoma Real Estate 2022

The Dream Lives on in Napa / Sonoma and Further Afield –  Real Estate Another exciting year is underway as we approach Spring.  Let’s take a look at Napa and Sonoma Real Estate 2022.  With pruning behind us, we anticipate bud break in the coming months. The cycle continues. Before going any further, I have […]... Read more

Sonoma and Napa Winter 2021

Light on the Horizon Dust Settles During the Sonoma and Napa Winter 2021 If there is one thing we have learned over the last several years, it is that wine country is resilient.  Wildfires, economic uncertainty, politics and a worldwide pandemic have all conspired to shake our core, especially in 2020.  But here we are, […]... Read more

Moving Forward – Sonoma and Napa Real Estate 2020

Clearly, we are enduring an unprecedented challenge with Covid-19 health issues and associated economic impact.    As a community I am sure we will ultimately arrive at a   destination that resembles the wine country that we all know and love.... Read more

Opportunities and Challenges in Napa and Sonoma

No doubt, the last few years have been good in wine country with increasing wine grape and real estate prices. While things are still good in wine country, there have been some changes in the market over the last six months.... Read more

Wine Country Real Estate and Wine Industry News

It goes without saying that the vineyard, wine grape and wine industry has an impact on real estate in Napa Valley, Sonoma County and all other wine regions.  Be sure to check back often to read current and past wine country real estate and wine industry news.  Sourced from industry experts to keep you informed.... Read more

Going Coastal In Sonoma County

Living in Sonoma County wine country can be like winning the lifestyle lottery. Imagine waking up in a place where world-class Pinot Noir vineyards grace the hillsides, and the only nuisance you will experience is a flock of gobbling turkeys loitering outside your window at their own slow, leisurely pace. But the true beauty of […]... Read more

At Home In Sonoma County

Russian River Valley For the last quarter century, I have had the pleasure of calling Sonoma County’s Russian River Valley home.  During that time, I have witnessed the region go from an “under dog” reputation to world-class status.  Russian River Valley Pinot Noir and Chardonnay vineyards are some of the most sought after in California […]... Read more

Notable Vineyard and Winery Sales 2024

Throughout the year you can check back here to see any notable publicized vineyard and winery sales in 2024.  The various sales and transactions are not only interesting but may also point to trends that can impact real estate in Napa, Sonoma and other wine country regions. This page will be updated throughout the year […]... Read more

Napa Valley and Sonoma County Wine Grape Prices 2024

Based on the grape crush report it would appear Napa Valley and Sonoma County wine grape prices continue their upward climb as we enter 2024. The one exception is Sonoma County Cabernet which noted a very modest drop from the previous year.... Read more

Buying a home, vineyard or winery in Sonoma or Napa & Video

Are you considering a move to wine country?  Does the image of rolling hills, rows of vineyards in a bucolic setting come to mind?  If so, purchasing a home, vineyard, or winery real estate may be your next step.  Buying and selling wine country real estate isn't always black and white.... Read more

Wine Country Resources

When moving to wine country, or even after living the area for decades, there will be a time when you need some expert help and wine country resources.  Here are links to various experts in Sonoma and Napa Counties. Wine Country Experts – Sonoma and Napa Architects Designers Lenders Legal Advisors Appraisers CPA / Financial […]... Read more