Napa Valley foreclosures threaten California wine country
The foreclosure wrath appears to be squashing California’s grapes, according to Bloomberg.com. Napa Valley — the most famous wine-making region in the United States and among the most respected in the world — is currently on “life support,” enduring its most difficult financial downturn in more than two decades. The report indicates that as many as 10 [...]
The foreclosure wrath appears to be squashing California’s grapes, according to Bloomberg.com.
Napa Valley — the most famous wine-making region in the United States and among the most respected in the world — is currently on “life support,” enduring its most difficult financial downturn in more than two decades.
The report indicates that as many as 10 wineries could be lost to foreclosure in 2010 alone, which is 10 more than what was recorded just two years ago in 2008 (zero).
The reason?
Connoisseurs, collectors and wine enthusiasts are stocking their cellars with less expensive vintages, reducing their expenses as the national economy attempts to recover from a major recession.
In fact, Franzia’s box wine, which costs about $8 a pop, is currently flying off the shelves.
Stephen Rannekleiv, an analyst, explains the domino effect:
“Consumers are looking at price point and saying that Napa is not the price they want to be buying at. Wine prices drive grape prices drive land prices…. No area is going to be unaffected by this financial meltdown.”
More than 30 wineries are currently for sale in the area, which includes vineyards in Oregon and Washington, in addition to those in “The Golden State.”
Unfortunately, with prices starting at around $115,000 an acre (it can get up to $250,000 an acre in the most desirable areas) this situation might not improve with age.
Not in the short-term, anyway.
