Wine estates in Bordeaux do not demand the prices they once did. New World wine competition cut into their share, and for fifteen years, Bordeaux real estate depreciated. Yet recently, the tides have turned. Bloomberg reports that a new crop of buyers from China have taken an interest in buying the region’s estates. Chinese investors have purchased 100 estates since 2010, and their interest has proved contagious. Many surrounding estates, especially mid-tier and top estates, have recovered their values circa 2000, and the less prestigious parcels—though nowhere near their former values—are slowly regaining their ground.
One of the more impressive properties, Château de Birot, was acquired by New Century, a Hangzhou-based tourism group. The group already holds 160 luxury hotels and will presumably incorporate Château de Birot into their hospitality portfolio, though former owner Arthur Fournier will stay on to manage the land. Broker Michael Baynes notes, “I think these first 100 buyers of Bordeaux chateaux have absolutely called the market correctly and I think they’re onto something very interesting. What they look at is the bottom line… They don’t do something unless there’s a clear profit margin at the end of it.” The Chinese taste for luxury, however, is perhaps a reaction to its government’s austerity in an economy that increasingly favors top-tier status. [Bloomberg] [Image: Flickr/José Carlos Babo]