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Big Price Paid for Sonoma Pinot and Syrah Vineyard

Questions raised by $4.1 million price tag as to whether grape prices will rise for producers, and how it will affect wine prices in the future

James Laube

Posted: Tuesday, June 05, 2007

Amber Ridge Vineyard in Sonoma County, Calif.'s Russian River Valley has been sold to Nickel & Nickel winery in Napa Valley for $4.1 million. At $130,000 an acre, it is one of the highest prices ever paid for a Russian River vineyard.

"We know it's a lot of money," said Larry Maguire, a partner in Nickel & Nickel, which also owns the Far Niente and Dolce wineries in Napa. But the acquisition fits with the company's focus on single-vineyard bottlings; it has two dozen single-vineyard wines from Napa and Sonoma alone. "We have a lot invested in the single-vineyard [program]," he said. "If you're in [the wine business] for the long term, you have to control the vineyards."

The 31-acre property west of Windsor is planted to Pinot Noir, Syrah and Chardonnay, and comes with a home site. The vineyard, which is also known as Darien Vineyard (named for the property's former owner, Frank Darien), is a source of Pinot Noir for the Dain, Kosta Browne, Siduri and Sonnet wineries, as well as Syrah for Nickel & Nickel. Maguire said that Nickel & Nickel planned to honor its grape contracts with those other producers, and that the company had not decided whether it, too, would produce a Pinot from the property. Most importantly for Nickel & Nickel, though, the acquisition locks up the Syrah it needs now and in the foreseeable future.

Whether the price paid for the vineyard set a record or is setting a trend is hard to say, winery owners familiar with land prices said. But in recent years the high end for Sonoma vineyards per acre has been in the $80,000 to $100,000 range. Prime vineyard land in Napa Valley, by comparison, sells in the $200,000 to $280,000 range.

"I think that's fairly high [for Sonoma]," said Adam Lee, owner and winemaker at Siduri. But the vineyard is a steady, reliable producer of top-end Pinot Noir, he said. It routinely can produce 3 to 3.5 tons per acre, and because it's in a warm site, the grapes ripen rather readily. "If you're a grower and able to get that [size of crop] on a consistent basis, that's a pretty good thing," Lee added.

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