Vineyards: new wine-related investment opportunities

, published on Feb. 15, 2022

[Publi-editorial content] Although sales of vineyards plummeted in 2020 as a result of the pandemic, Les Grands Domaines | Lucas Fox agency, experts in wine property sales, has observed a strong upswing in 2021. The reason? A new kind of investment focusing on diversification of development opportunities.

Wine property sales: new projects with diversification at their core

Today, buyers purchasing wine properties are no longer focusing solely on the production and marketing of wines but are embracing new economic activities relating to vine and wine-based products: the cosmetics, wine tourism and hospitality sectors are also investing in the French wine industry, exploring new grape-based development opportunities. Marc Escassut is not surprised by this development; for some years now, this oenologist, wine-maker and consultant who runs Les Grands Domaines | Lucas Fox has been advising investors looking for unique vineyard projects and has seen his client base diversify over the years. In fact, although the number of transactions declined in 2020, reaching its lowest level for nearly 30 years, the price per hectare increased with AOP vineyards selling at +1.3 % in 2020 compared to 2019, confirming their status as a sound investment.


Sustainable business: grapes are in vogue

Buying vineyards, rather than just buying land, is now at the heart of sustainable development and evidence of a new-found respect for wine heritage. “Today’s investors want to move beyond mere acquisition and production, attempting to connect with a new client base by developing projects ranging from wine tourism to hospitality.” It is also a way of avoiding the short-term difficulties relating to vineyards and wine production, as well as pandemics and climate-related risks (the 2021 grape harvest was down 31% compared to the previous twenty-year average) and ensuring a decent income. These new projects are both economically ambitious - wine-tourism increased by 33% between 2009 and 2016 reaching 10 million tourists in France - as well as environmentally so, with the number of organically farmed estates increasing by +70% between 2014 and 2019. If developed in a coherent and precise manner, such projects, combining vine cultivation and tourism activities, can provide excellent new investment opportunities. But you need to be careful, Marc Escassut tells us: “Buying a vineyard is not just about investing with the heart; if you don’t view the property as a business, you can seriously compromise a project’s viability.”


Wine tourism: an investment that attracts savvy entrepreneurs

Unlike other agencies specializing in vineyard estates, Les Grands Domaines | Lucas Fox mainly deals with off-market or discreet property listings. The reason? Purchasing land is, first and foremost, a question of finding a place to fit the plan; you can’t choose a vineyard from a catalogue as you’ll run the risk of getting it wrong. Which is why Marc Escassut, who has a wealth of experience in wine production and the wine trade - both traditional and organic - in the South, guides and supports his buyers throughout, with the aim of acquiring and building economically profitable projects.


From looking for properties that match the investment profile and detailed organization and monitoring of future projects, to the overall coordination of vineyard-related activities (making the wine, auditing the cellar, bookkeeping, distribution and marketing etc.), the support of specialists like Marc Escassut is invaluable in helping investors master each stage of their project - before and after the sale - and getting the most out of it. For this reason, the company typically advises its customers for three to five years, not just at the time of purchase.



Opportunities in France and Spain

Although the appeal of French wine-growing regions such as Provence, Bordeaux and the Rhône valley is well established with an increase in average sales prices, in recent years opportunities have also arisen in the Languedoc-Roussillon as well as in Spain. Les Grands Domaines takes a keen interest in these regions, offering potential purchasers the opportunity to buy and transform exceptional estates with unique development potential such as, for example, an old farmhouse, surrounded by vineyards and olive trees, near the future Agroparc, near Barcelona, due to be converted to a wine-hotel complex.


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