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Pioneering New Zealand winery assets placed on the market for sale

Tags: Commercial

The land, equipment, buildings, and hospitality business linked to one of New Zealand’s first wineries have been placed on the market for sale.

Pioneering Vidal Estate vineyard was established in Hawke’s Bay in 1905 by young Spanish migrant Anthony Joseph Vidal who planted grapes in Hastings, and set about establishing a wine empire with its base stretching across the nearby Te Awanga and Te Mata plains.

Now, some 113 years later, the foundations of the Vidal empire – in a location surrounded by residential dwellings – are for sale, as the brand looks to move its production plant to a new multi-million dollar location at the Te Awa Winery and Restaurant on State Highway 50.

The freehold Vidal Estate Winery property at 904 – 908 Avenue Road East in Hastings consists of some 8,592 square metres of land sustaining 3,670 square metres of fully working winery, along with the adjacent large-scale restaurant and function/event-hosting amenity trading as the Vidal Estate Winery Restaurant.

A further 1872m2 of land holding five houses generating a total rental income of $52,000 forms part of the sale. Other residential accommodation onsite has a potential income of $41,600 per annum.

The asset portfolio is being marketed for sale by tender through Bayleys Hawke’s Bay, with tenders closing on March 7, 2018. Bayleys Hawke’s Bay salesperson Paul Garland said the dynamics and scale of the property, buildings, and infrastructure, meant there were numerous future-use potentials for the Vidal Estate portfolio. The Vidal brand name is not part of the offering.

“The Avenue Road East location is far more than just a winery or restaurant/ function centre,” Mr Garland said.

“The most obvious use going forward is to continue both the winery and restaurant/function room operations as-is under a new name in a vertically-integrated business model where the wine is made and sold on-site to guests hosted in semi-industrial character surrounds.

“Alternatively, a new joint-ownership model could see a winery label utilising the winery amenities, and a separate hospitality entity running the restaurant and function venue – with both reliant on each other as marketing points of difference and sales channels.

“Or the entire portfolio could be secured by an entrepreneur/investor who could purchase the location and assets then lease out the two revenue streams to specialists.

“That would leave any new owner the potential to bring on board additional retail tenants such as a craft brewer, cidery, honey farm or perhaps a gourmet foodstore, which again could both work simultaneously together by broadening out the location’s food and beverage destination appeal. As always, prospective purchasers should make their own enquiry to the Hastings City Council regarding zoning and usage.

“Either way, the buildings, equipment and chattels in place allow for the Vidal Estate assets to be purchased with a new owner having what they need to continue producing award winning wine under a new brand name.

Mr Garland said the Vidal portfolio was being sold with the options of either a long settlement period stretching out to the third or fourth quarters of 2018, or with Vidal Estate Winery open to settling on a sale earlier then leasing back the plant and venue by negotiation to complete the 2018 harvest season, and to simultaneously deliver on a substantial number of functions and restaurant sittings already booked in over the corresponding summer and autumn periods.

Sir George Fistonich’s Vidal Estate Winery Restaurant was New Zealand’s first ‘winery restaurant’ when it was opened by the then Prime Minister of New Zealand Sir Robert Muldoon in 1979 – setting the trend which has now gone on to be commonplace in all of New Zealand’s wine-producing regions. Since then, the 200-person venue has broadened its marketing appeal in both the leisure and corporate sectors.

The licensed Aubyn Street premises features three separate function locations – a small tasting room handling both retail sales and gatherings of up to 30 people, the character-filled and working barrel storage room capable of hosting up to 38 seated or 70 standing guests, and the main restaurant/function room with a seating capacity of 80 seated and another 40 within the conservatory. The venue has sealed car parking for approximately 70 vehicles.

Vidal Estate’s winery has historically produced 1,200 tons of wine per season – equivalent to approximately 96,000 cases. Mr Garland said the equipment and infrastructure being sold in the Vidal Estate Winery portfolio would enable the successful buyer to operate from a 500-600 ton boutique winery.

“All they will need is a new brand name. Under a new ownership model, there is ample opportunity to increase production from the winery by sourcing contract-grown grapes from within Hawke’s Bay, or crushed juice from outside the region,” Mr Garland said.

The Vidal Estate Winery Restaurant and function centre sits within a 1,855 square metre ground level space with an additional 198 square metres of al-fresco dining courtyard area - both served by an 50 square metre commercial-grade kitchen.

The commercial-grade stainless steel kitchen features a 7.5 square metre walk-in chiller unit with shelving, a combi’ oven, gas hob hot plate section, large oven, overhead grillers, and deep fryer – all under a full length stainless steel extraction canopy hood with fans. Commercial-grade dishwashing and rinsing units are also part of the chattels.

Meanwhile, front of house chattels include scores of rectangular and round tables, formal seats, along with all glassware, crockery and cutlery, and point of sale systems.

In addition to the commercial buildings and supporting chattels, the property for sale also encompasses five separate residential dwellings configured in two and three bedroom premises. The homes are located on a block bordered by Aubyn Street East, Park Road North, and Avenue Road East.

“Under any new hospitality/function centre business model, these assets could easily be converted into a lodge or village style accommodation entity,” Mr Garland said.

“With a shortage of residential dwellings in Hawke’s Bay the underlining residential zoning of the winery could also be of interest to residential property developers.”

“While the ‘bones’ of the dwellings are sound, a refurbishment and modernisation programme would substantially lift their yield potential as commercial accommodation units.

“Alternatively, and with no change to existing decore, they could continue to remain as manager/staff quarters for personnel employed in both the winery or function centre businesses.”

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