Foreign buyers secure Marlborough vineyard ahead of expected increased international investment levels

The sale of an architecturally-designed property set amongst sauvignon blanc vineyards in Marlborough reflects a bold and brave move on the part of overseas-based buyers to commit to land ownership ‘down under’ at a time when foreign investment is being made easier.

The Government’s last month announced that there will be a relaxation of business migrant rules to allow wealthy investors and entrepreneurs easier access to residency in New Zealand. In parallel, a review is underway of overseas investment rules to make foreign investment here simpler and more attractive. These have laid the foundations for the way to be cleared for more sales of New Zealand vineyards to international buyers.

In Marlborough, an American couple who have lived in Thailand for the past 30 years, have recently managed to satisfy the stringent Overseas Investment Office (OIO) requirements and will soon be living the Kiwi dream for part of every year - choosing New Zealand as the place they wish to invest some of their hard-earned dollars. The pair has just purchased a home and vineyard known as Patriach.

With the 2009 Marlborough wine vintage accounting for 68 percent of the total tonnage achieved across New Zealand, the region’s place in this country’s wine economy is proven. The established European and West Coast of America vineyards are finding a now finding a geographical challenger for investment dollars - with many of Marlborough’s vineyards now having total or partial overseas ownership.

A focus on presenting opportunities to a global market as a complement to targeted national marketing campaigns, has seen a rise in international enquiry on New Zealand property according to Bayleys Real Estate.

Factors such as the ‘safe haven’ and ‘clean green’ perceptions of this country are fuelling interest as is the perceived value-for-money courtesy of attractive exchange rates for foreign buyers. These positive influences will be boosted by the relaxation of OIO bureaucracy.

Tim Crawford of Bayleys Marlborough successfully sold Patriarch - the architecturally-designed home/guest accommodation and sauvignon blanc vineyard - following protracted international negotiations. The initial enquiry on the property came via email from his clients who saw the property featured on the Bayleys’ website.
“This couple had a real soft spot for New Zealand having visited for the first time four years ago, eloping and getting married in the Marlborough District Court. Each year since, they have returned to Marlborough to celebrate their anniversary. They contacted me 18 months ago when they saw Patriarch for sale on the website,” says Mr Crawford who marketed the property with his colleague, John Hoare.

“They came out to have a look at the property and agreed it was exactly what they were looking for, but needed some reassurance as to value, given their inexperience in the New Zealand property market. They looked at a number of other properties to provide a comparison before concluding that, whilst perfect for them, Patriarch was beyond their price range.”

However, when the Kiwi/US$ exchange rate dropped some months later to around the 51cent mark, they decided to pursue the purchase. Given the property’s eight hectare scale, it required Overseas Investment Office approval for any foreign ownership. Mr Crawford was able to facilitate this process - ensuring they had all the necessary information to proceed.

During an extended stay in Marlborough, Mr Crawford also introduced the couple to key people in the local wine industry. Now that the new owners have taken possession of the property, they have made the decision to convert the vineyard to organic status in the coming years.

“They are able to experience all the ‘ups’ of owning a vineyard and leave the actual day-to-day work to others - which is appealing, given they are still based in Thailand for much of the year,” explains Mr Crawford.

“In time, they hope to assist the wine company they are supplying grapes to in marketing some of the wine into Asia, which is a growing market for Marlborough wine.”
Property sales to international buyers – particularly if they involve OIO compliance – can be a drawn-out process and the buyers of Patriarch credit Mr Crawford’s integrity, patience and thorough professionalism in giving them the confidence to make such a purchase.

“Mr Crawford’s skills in guiding us - an enthusiastic but clueless overseas party - is what really made the difference,” say the Thailand-based buyers.