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Why wealthy Chinese invest so much in Bordeaux vineyards

Why wealthy Chinese invest so much in Bordeaux vineyards

Vgnobles de Bo

The Bordeaux vineyards are renowned and their wines known around the world. The Chinese – whose taste for luxury products ‘Made in France’ and biggest fashion brands is well-known – are also quite fond of wine, Champagne, and more generally the French art of living. In fact, some wealthy families are investing more and more in Bordeaux vineyards. What are the reasons and consequences?

Bordeaux vineyards: The attraction of an exceptional wine and real estate heritage, but not only…

While Asian investors are initially owners of “small” estates whose price oscillates between 2 and 7 million euros, they sometimes goes into higher gear if they are convinced by their first investment. Some prices soar, without scaring wealthy businessmen, like Jack Ma – founder of Alibaba – who is seduced by great wines and owns the Château de Sours, de Perenne et Guerry. Some domains are estimated worth over 60 million euros, and there actually is a demand for such deals.

Some numbers : since 1984, 153 transactions from China concerning Bordeaux châteaux have been recorded. In 2013, the record was set at 35 châteaux sold in a single year. (Source: Vitisphere ).

The main reasons that push the Chinese to invest in Bordeaux vineyards are:

The potential profitability of their financial investment;

– The acquisition of a historical real estate heritage, sometimes classified;

– Knowledge of Chinese red wine market for export;

A business opportunity, among others

Indeed, the Chinese, although they are in love with the architectural, natural and gastronomic heritage of the region, they also see the return on investment they can hope for. For them, it’s not just about passion, but rather a company they invest in. Some wines are sold for gold once in China, and the development of wine tourism in Bordeaux supports the investor in the diversification of his sources of income, in case of a bad harvest year for example.

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The consequences for the region’s wine industry

According to some specialists in the profession, these investments are a boon for the profession of winegrower in Bordeaux and the surrounding area. Indeed, the Chinese are “the best ambassadors to their compatriots” according to Georges Haushalter, former president of the Interprofessional Council of Bordeaux Wine (CIVB). Enough to promote France’s position as a number 1 wine-export country to China.

However, not all those involved in Bordeaux viticulture and Bordeaux vineyards are delighted with this new trend. Although the number of properties acquired by the Chinese is still marginal out of the 8,000 ones in the region, some do denounce a loss of mastery of know-how and traditions that were held in the hands for entire generations of wine-growing families.

Yet, many of these investors keep local production tools and methods, or even seek to improve them and give a new dimension to their newly acquired grape varieties. However, it is also important to note that a lot of investments in Bordeaux vineyards are made by French or European companies.

The main thing to remember

Although these investments from the other side of the planet can represent a “danger” for some followers of centuries-old traditions passing into the hands of Chinese owners, the vineyard is not exportable and will indeed remain on French soil. If the Chinese and others Asian investors passionate about wine are able to invest fortunes necessary for the development of the Bordeaux wine industry, a fair balance in investment and export relations seems to be a great opportunity for wine production and wine tourism in Bordeaux .

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