Owning or investing in a wine farm in the Cape, especially areas such as Franschhoek, Paarl and Stellenbosch, and sipping from your own label is a dream for many South Africans.
Pierre Germishuys, Seeff’s managing director for the Cape Winelands/Boland says that demand for farms has increased over the last two years and top end farms are again on the market.
While the lower end of the price scale to around the R30 million mark remains most in demand, the last year or so has seen top end investors prepared to pay top end prices again for wine farms especially in the Stellenbosch area according to agri-agent, Andre Malan.
This includes three transactions in 2015: a 28ha farm that sold for R54.5 million. Uva Mira, a 140ha estate located between Stellenbosch and Somerset West for R65 million (R464 000/ha), and the 100ha Cordoba, located high up on the slopes of the Helderberg Mountain sold for R58 million (R580 000/ha).
Other recent sales in the Stellenbosch area include the 202ha Klaver Valley farm that sold last year for R96.5 million at a rate of R477 000/ha.
The year before, there were also two top end sales of R40.7 million and R42.5 million for 99ha and 74ha respectively, achieving a rate per hectare of R430 000 and R550 000 respectively.
While the demand is strong for top end farms, prices have remained fairly flat over the last five years, says Malan. Prices vary depending on the location, strength of the wine brand and the facilities on offer such as a hotel, restaurant and cottages.
In general though, smaller boutique wine farms start at around the R20-R30 million mark while top end wine brands can sell for up to R200 million and as much as R300 million, depending on the brand, Seeff said.
Most of the top end farms are marketed on a very exclusive and confidential basis and not advertised.
Farms in the Franschhoek valley tend to fetch the highest prices and can range to about the R1 million to R1.2 million per hectare at the top end.
Stellenbosch farms sell for about R800 000 to R1 million per hectare, and for about R400,000 to R600,000 per hectare in the Paarl Valley.
Historic farms tend to attract a lot of attention especially those with well-preserved Cape Dutch heritage architecture, Seeff said.
Malan says that investors tend to seek these out for renovation and development into a top class wine brand that can then be worth several millions of rand.
There are usually very few on the market. In the Stellenbosch area, there is for example just one rare find, a 62ha farm that dates to the late 1600s with its original 500sqm Cape Dutch manor house still well-preserved.
It is located in the Bottelary Hills area and is priced at R17.95 million. The farm includes 40ha planted with Pinotage, Chenin Blanc, Shiraz and Merlot. The estate currently has shares in a nearby wine cellar that processes the annual grape production.
The old wine cellar is also still on the farm and although in disuse, could potentially also be renovated and restored.
There are also several outbuildings including two sheds of 600sqm each, a three-bedroomed manager’s house and several labourers’ cottages.