Cape Vineyards in Vogue
21 January 2016
Joan Muller Financial Mail
OWNING a vineyard in the premier Cape Winelands regions of Stellenbosch, Franschhoek and Paarl has seemingly lost none of its cachet, with a number of R50m-plus sales concluded last year.
Hidden Farm, perched high on the slopes of the Helderberg mountains between Stellenbosch and Somerset West, was bought by former Capitec Bank chief executive Riaan Stassen as a going concern for a rumoured R54.5m.
The 30ha farm is home to the Hidden Valley winery, an oil and table olive business as well as acclaimed restaurant Overture.
Other wine farms that have recently changed hands in the Stellenbosch area include the 140ha Uva Mira that was sold for R65m, the 100ha Cordoba that fetched R58m and the 202ha Klaver Valley at a price tag of R96.5m, which translates into a rate per hectare price of R430 000-R580 000.
Big-ticket wine farms that have been sold to prominent offshore investors in the Cape Winelands over the past two to three years include Mont Rochelle in Franschhoek to Virgin Atlantic’s Richard Branson and neighbouring Dieu Donné, Klein Dassenberg and Von Ortloff, now amalgamated into Leeu Estates, to Indian billionaire Analjit Singh.
Chinese tech entrepreneur William Wu bought a 51% stake in the sprawling Swartland Winery near Malmesbury.
However, despite the weak rand, recent sales have gone mostly to SA investors, says André Malan, Seeff agri-agent in the Stellenbosch area.
Buyers are typically successful local business entrepreneurs and retirees.
While vineyards are still widely regarded as the ultimate trophy asset, demand has also been driven by improved investment prospects on the back of an increase in international demand for SA wines.
SA exported 418m litres of wine in the 12 months ending November 2015, according to latest figures from industry research body SA Wine Industry Information & Systems (SAWIS).
That’s down from the record 520m litres sold in 2013 when a global shortage resulting from poor European crops drove SA demand sky high. However, it’s still 50% up on the 280m litres/year that SA was exporting 10 years ago.
While top-end wine farms are achieving record prices north of R1,5m/ha, industry players say average prices have remained fairly flat over the past five years — roughly between R400 000/ha and R1m/ha.