What’s in the Napa name? Turns out, quite a bit, for agriculture land values.
Contrary to most growing regions in the state, Napa County ag land maintained demand as well as prices in 2010, according to a report by the American Society of Farm Managers and Rural Appraisers.
An acre of prime Napa Valley vineyard went for $225,000 to $300,000 or more last year, the report said. Secondary or fringe area vineyard land commanded $50,000 an acre and up.
In comparison, the prime area vineyard land in Sonoma County was as high as $125,000 an acre. Monterey County wine grape land topped out at $38,000 an acre, and the same land in San Luis Obispo and Santa Barbara counties was as high as $57,000 an acre.
Napa County has “above average” financial stability and weathers economic downturns better than most ag markets in the state, the report said.
The key factor supporting those prices is that Napa County is mostly fully developed and home to many ultra-premium vineyards and wineries that produce world-renowned wines, experts said.
“Napa Valley is the top of the food chain,” Vic Motto of Global Wine Partners in St. Helena said. “If you were to ask people from Europe or Asia about American wines, they all name Napa.”
“Our sales activity is going off the chart right now,” said Hal Forcey, an appraiser who wrote the Napa County section of the report. “Napa County was one of the few places in ag that didn’t see a downturn. We have consistently seen fairly decent sales activity.”
That trend continues in 2011, Forcey said. “There are more people looking for properties than are available.”
“I’ve conformed sales this week from $135,000 an acre up to more than $280,000 an acre for good established vineyards,” he said.
A number of high-profile wineries and vineyard properties were sold in 2010 including Black Stallion, Diamond Oaks Vineyard & Winery, St. Helena Winery, Havens Wine Cellars, Bella Oaks vineyard and Pritchard Hill vineyard.
“When you look at a vineyard like Bella Oaks, they sell whether in good times or bad times,” Motto said. “If you have a top vineyard, there will always be buyers for it.”
“It’s almost like art,” Katie Somple with LifeStyle Properties in St. Helena, said. Settings and views can be subjective, but size and uses of vineyards are more objective, she said.
“What can you get out of that particular site? Is it a standalone vineyard? Often times a seller will tack on $500,000 to $2 million for the ability for someone to build a beautiful home at the site. It has nothing to do with the value of the vineyards,” Somple said.
Even fringe areas of Pope and Chiles Valley, where ag land values are closer to those in Mendocino or Sonoma County, can still draw on the Napa Valley American Viticultural Area (AVA) name when selling fruit, Forcey noted.
“It’s Napa,” he said.
JENNIFER HUFFMAN | Napa Valley Register