Purchasing Vineyards and Viticulture Land in Hawkes Bay
The Hawke’s Bay District differs from other broad growing areas within New Zealand through the variation in micro climates and soil types within which wine grapes are grown and arguably, the wider range of premium quality wines that might be produced. Given this relatively wide choice careful site appraisal is essential. If the investor has an ambition to make wine of a particular variety and style then special consideration needs to be given to the requirements of that particular grape variety. However a common pre requisite for premium wine grape production is a low vigor site with free draining soils. In addition irrigation for both vine establishment and subsequently for grape production will be an important consideration. In many French vineyards famous for their fine wines, irrigation is not practiced or even permitted. In Hawkes Bay on shingle, red metal and other very free draining soil types, natural soil water retention can be very low. Without controlled irrigation water, vines will become stressed when ripening fruit over extended dry periods. Contrary to some opinion, fruit from drought stressed vines is unlikely to make good wine and drought stress can in fact result in off flavor characteristics. This being the case, an otherwise ideal vineyard site is of little value without access to adequate irrigation water (and if necessary frost control water). In addition a legal consent will be required to use that water. Within Hawke’s Bay water consents are issued by the Hawkes Bay Regional Council and are very carefully controlled. In some areas, especially where water is drawn from a stream, river, riverbed or a commonly used aquifer, water rights are already fully allocated. Further water rights are not available and new vineyard or horticultural development simply not possible.
An important factor in selecting a vineyard location is the potential of that site for late spring frost. In 2000 and 2003, Hawkes Bay vineyards – even in coastal areas previously thought immune to frost damage, were severely damaged by late spring air frosts. Some of the very best growing areas in Hawke’s Bay are particularly frost prone. Measures to combat frost include spraying water, frost pots, wind mills and hiring helicopters (the latter two are used to move layers of higher air which have not reached freezing level down to the vineyard level). A recent innovation has been the use of tractor drawn mobile LPG heaters.
Within recognised growing areas premium vineyard land has commonly sold at prices between $40,000 and $50,000 per hectare. Land prices within the Gimblett Gravel are usually considerably higher, driven largely by the fact that this land area is limited in size, demand and the fact that blocks are not often made available. Other outer-lying areas very suitable for vineyard development but still predominantly in livestock production are often available for sale priced in the region of $20,000 per hectare.
Prices paid for producing vineyards are can be quite variable. There are very few of the early bulk Muller Thurgau (or similar) vineyards remaining within Hawke’s Bay. In reality these have only bare land value, minus perhaps the cost of removing their posts and vines.
There remain however substantial plantings on relatively fertile silt loam soils, what can best be described as medium or bulk quality Chardonnay, Merlot, Sauvignon Blanc and a few other varieties dating from the 1980’s. Many of the established vineyards offered for sale in Hawke’s Bay come into this category. Up until the 2004 vintage there has been an under supply of classic grape varieties within Hawkes Bay and premium high quality well ripened grapes from low yielding vineyards have not received a substantial price premium over average quality grapes. High yielding vineyards have been the most profitable for growers not involved in wine making and sale prices for this type of vineyard have commonly been between $50,000 and $60,000 per hectare. This situation will not continue given the extensive plantings of high quality vineyards currently coming into maturity and production.
A largest land rural land areas in Hawke’s Bay are utilised as hill country pastoral farms, a substantial proportion of which have substantial areas of limestone derived soils. There is a growing appreciation that where adequate water is available (commonly so in limestone country) warm, sheltered, north facing slopes can be an ideal medium for a number of grape varieties. Vineyards in the Rhone valley of France (home of Syrah) are commonly based on limestone soils. There are of course other important aspects of vineyard site selection to be considered, however prices for this class of land can be very reasonable. An example of the quality of wine made from grapes grown from this class of hillside site can be seen in the Hawkes Bay winery Brookfield’s 2002 Hillside Syrah, which sent shock waves through the Australian wine Industry by winning in the Sydney International Wine Competition both the top award for best red table wine and for the best fuller bodied red table wine. Another recent Hawke’s Bay wine “Bilancia” from a hillside vineyard won the Syrah trophy in the New Zealand Wine Society Royal Easter Show.
Filed under: Advice, Hawkes Bay, Investment, Moving to New Zealand, Vineyards
