Premium Napa producer Robert Mondavi Winery is selling 640 hectares (ha) of prime vineyard land – and offering two surplus winery facilities for sale.

The property includes about 400ha in the Santa Maria Valley of Santa Barbara County on the Central Californian coast. The land is priced at $38.5 million (€40,782,000), and the deal includes the old Byron Winery, which has been superceded by a new facility. Mondavi will keep some 60ha of vineyards, which a spokeswoman says provides an adequate supply for the Byron brand.

In Napa Valley, Mondavi offered an undeveloped 64ha parcel called Suscol Springs, which is expected to yield approximately 40ha of vineyards. The reported price is $7.5 million (€7.9 million).

In Mendocino County on the North Coast, Mondavi is offering three separate vineyards that, combined, have a planted area of nearly 176ha, some of which is just coming into production. The price for the package is $19.35 million (€20.5 million). The vineyards in question are Bald Eagle in Potter Valley and Lover’s Lane and Yokayo Vineyard near Ukiah. Land in Mendocino is normally significantly less expensive than its Napa equivalent, but these vineyards are already planted.

Last year, the firm also placed its highly visible La Famiglia Winery facility in Napa on the market. The winery, with its exceptional views, includes a valuable permit to make wine from non-Napa Valley grapes, a practice no longer allowed. Mondavi will continue to make La Famiglia Italian varietal wines at existing facilities elsewhere.

Mondavi CEO Greg Evans said, ‘We no longer need these vineyards and winery facilities for our wines, either because they’ve been replaced or because our brands are sourcing fruit from other appellations.’

Andy Bledsoe, the firm’s vice president of winegrowing, who is responsible for bought and grown grapes, admitted that Mondavi has probably suffered greater oversupply than many producers. It has a higher number of long-term contracts and its sales have suffered due to the high percentage of its wines sold in high-end restaurants.

Besides selling property, Mondavi is also not writing new contracts or renewing old ones, and is trying to renegotiate contracts to reduce unneeded supply, such as Italian varietals like Sangiovese that aren’t selling well. Bledsoe expects to be back to better balance in two to three years. He warned other embattled growers, ‘If you call me to try to sell grapes, I’ll try to sell some of our surplus to you.’

Written by Paul Franson in California7 June 2002