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Fine wine vineyards ripe for investment

Investing in the right vineyard can still bring lucrative returns as the global market for fine wine continues to expand, said expert Christian Seely in a lecture Monday night. “We sell everything we make in Hungary, but prices could be higher if people recognized these great wines.”

Terroir is the key to making money from a vineyard, Seely, managing director of AXA Millésimes, told guests at this year’s annual Wine & Spirit Education Trust lecture. He told potential investors to aim high in order to capture a growing market for fine wines, particularly driven by a new generation of rich, young professionals in Russia and Asia. Grand Cru wines, he said, would continue rising in price, but he added that lesser bought, sweet dessert wines, such as Sauternes or Tokai, could be ripe for a renaissance in Asia. “We sell everything we make in Hungary, but prices could be higher if people recognized these great wines. It would only take a tiny movement in world demand to change things dramatically – particularly in markets of Asia where the sweetness conforms to the tastes of people in these regions.”

Vineyard investors, he said, should be looking to spend between €7-10 million (about $10-14 million) or more, with a return on investment of around 20-30 years. “The risk is high but so is the possible reward.” On choosing the right vineyard, Seely told lecture goers to ignore thoughts of pretty farmhouses and a fairytale existence: “Does it have potential for greatness? Will it be easy to convince the world that it does? It is helpful when the answer to both questions is yes. I would therefore recommend resisting the temptation to buy a vineyard that looks cheap in an obscure part of the world.” Seely’s vineyards include Chateau Pichon-Longueville Baron and Chateau Pibran in Bordeaux and Quinta do Noval in Portugal. (drinksint.com)