Issue link: http://read.dmtmag.com/i/230154
NORTHWESTSULLIVAN WATCH SEAN P. bottle prices in the market and we have relatively low costs. If you put all of that together, we look pretty attractive." Thomson agreed. "This is a high-end premiumization play," he said of JFW's move into Oregon. "Oregon has premiumization of its space and California doesn't. Nine- ty percent of Oregon's wine sells for $12 or more per bottle, whereas 90% of California wine sells for under $12." VINEYARD LAND RUSH The effects of the 2013 transactions in Oregon were immediate, with a significant uptick in interest in vineyard land. OVS's Chambers said, "I've been in this industry 34 years now and I've never seen the level of activity that we see right now." Robert Nicholson, a principal at International Wine Associates, a Northern California wine industry merger and acquisition advisor, agreed, saying, "We have a number of people who are absolutely looking in Oregon now as a direct result of the Jadot transaction." Nicholson's company was directly involved in the purchase of Resonance Vineyard by Jadot. Some of the interest in vineyard land is coming from Oregon wineries themselves. "With KJ buying a thousand acres, that took a lot of vineyards out of play and fruit that was being sold to high-end brands," said Mark Freund, managing director of the Wine Division at Silicon Valley Bank. "Wineries want to lock up their sourcing and secure vineyards for their own brands so that they don't run into a situation where they lose that fruit source that was critical to their program." Mark Freund of Silicon Valley Bank predicts that KJ's Oregon vineyard acquisitions will make local fruit sourcing more difficult for some high-end brands. 28 V I N E YA R D & WIN E RY MANAGEM ENT | Jan - Feb 2014 w w w. v wm m e d i a . c o m