Ste Michelle de Washington puts Woodinville property up for sale and moves white wine production to eastern Washington | Sean P.Sullivan

Chateau St. Michelle, the largest winery in the Pacific Northwest by a mile, has put its flagship Woodinville property up for sale. The 118-acre site, which includes the iconic castle that adorns the winery labels, was listed earlier this month by CBRE Inc., a commercial real estate company based in Dallas, Texas. Pricing was not disclosed. The winery will also move all of its white wine production, which previously took place in Woodinville, eastern Washington.

“With this change in our winemaking operations, we are evaluating how best to utilize the facility in the future, including exploring a potential sale of our Woodinville property, or possibly part of this one,” Ste Michelle said in a statement to the media. “While a sale of the property has not been predetermined, we are considering all options as we continue to seek ways to improve the way we produce our wines, strengthen our commitment to sustainability and grow the Chateau Ste Michelle brand.”

The list of properties includes Chateau de Ste Michelle, tasting rooms, a banquet hall, offices, a theater, a warehouse of over 100,000 square feet and 50,000 square feet of barrel storage. The listing says the sprawling property is ‘prepared for redevelopment and can accommodate a variety of uses, such as industrial, residential, office and life sciences, all of which are rare in the open Eastside. rise of Seattle”.

Ste Michelle’s white wine production of more than one million cases will be moved to its Canoe Ridge winery in eastern Washington. Horse paradise hills starting with the 2022 vintage. Given the scale of its white wine efforts, other facilities will likely be used as well. Ste Michelle red wine production has taken place at Canoe Ridge since 1993. This site has occasionally had a tasting room over the years, but is currently not open to the public.

Ste Michelle said of the change, “Wine production in Woodinville, so far from our eastern Washington vineyards, has resulted in decades of shipping millions of gallons of white wine to our Woodinville facilities and burning nearly 75,000 gallons of diesel through more than 1,600 freight trips each year. .”

It is undoubtedly true. The winery’s huge production of white wine has always required coordination with many other businesses to supply fermenting juice and, to a lesser extent, finished wine to its hub in Woodinville, far from where Grapes. However, Ste Michelle no longer producing wine at its giant Woodinville factory would surely raise the question of whether the property was being used to its full value. The grounds are far too large and expensive to maintain only offices and a tasting room.

Founded in 1967, Ste Michelle Vintners moved to Woodinville from Seattle in 1976, building a castle and renaming itself Chateau Ste Michelle. The property, originally called Hollywood Farm, belonged to lumber baron Frederick Stimson (1868-1921).

In the 46 years since Ste Michelle’s move to Woodinville, over 130 wineries and tasting rooms have sprung up around it, largely due to Ste Michelle’s presence.

Presumably, if Ste Michelle sold the property in its entirety, the winery would look for another space in Woodinville to set up shop. The wine estate is too synonymous with the city not to maintain a strong presence there. If he were to leave Woodinville altogether, the effects on the region, the western Washington wine industry, and Washington wine in general would be incalculable.

Over 300,000 visitors come to Ste Michelle each year, for tastings and annual summer concerts on the lawn. These visitors draw tourism to the wineries, restaurants, and other businesses in town. If that were to stop or even drastically decrease, every winery in the region — and really every winery in Washington — would be affected to varying degrees.

“If they flipped the mothership, obviously that would have a big impact,” says Chris Sparkman, owner of Sparkman Cellars, which is located close to the Castle. “But one of the things we’ve always done is not get terribly overexcited about anything, focus on what we’re doing and what we can control, try to be a good neighbor and do our thing.”

Sparkman, who holds an international degree in environmental policy and was also an agroforester in the Peace Corps, has a long view. “These things happen in ecosystems where the mother log decays and eventually dies out, and it’s built this thriving ecosystem around itself.”

Ste Michelle points out that she is not fully committed to selling her property in Woodinville. On the contrary, he plans to sell all or part of it. The winery says: “This process is still in the exploratory phase and could take years to implement, if at all.”

Given the size and scale of the property as well as the complexity of its zoning, any sale and subsequent alterations would surely not happen quickly. It should be noted that more than half of the existing property is only zoned for residential purposes. Additionally, the Stimson Manor Residence and the original Hollywood Farm property are listed on the National Register of Historic Places which may provide limited protection.

The listing of the property comes as Ste Michelle Wine Estates, the parent company of Ste Michelle, has fallen on hard times in recent years. Formerly owned by tobacco giant Altria, the company announced an inventory write-off of $292 million along with losses of $100 million on non-cancellable grape purchases in 2020. Case production was down more than 1.2 million since 2016. The winery, which owned or controlled 70% of Washington’s wine grape acreage 10 years ago, now controls less than 50%.

In 2021, Ste Michelle was bought by Sycamore Partners, a New York-based private equity firm, for $1.3 billion. Although the company indicated at the time its intention to invest and grow the business, a commitment that is expected to remain, the sale has caused much difficulty in the industry that the company and the “string of pearls” that former CEO Ted Baseler helped create could be sold for parts and quick financial gain. Baseler retired in 2018 after 34 years with the company, including 17 as president and CEO. The company has since had two CEOs.

However, the hope was that Sycamore’s purchase would instead allow Ste Michelle to regain its footing and re-establish itself as Washington’s flagship winery while growing the brand. It could still happen, especially if Sycamore invests significantly in growing the winery. However, Sycamore putting the namesake property of Ste Michelle up for sale appears to be a worrying turn.

There’s also an old saying in the state wine industry that goes, “As St. Michelle goes, so goes Washington wine.” If true, these changes could spell tough times for winemakers in the state.

At the same time, many other Washington wineries are currently booming, with some of their best-selling years ever. Other big players, such as Jackson Family Wines, are showing interest in Washington and could potentially fill some of the void created by the abandonment of the Ste Michelle vineyard acreage. Jackson Family bought his first vineyard in Washington earlier this year. Ste Michelle’s withdrawal from thousands of acres of viticultural contracts in recent years has also opened up opportunities for others, although no winery has yet shown Ste Michelle’s once insatiable appetite for fruit.

Whether or not Ste Michelle’s Woodinville property is ultimately sold, the currently slumped winery means the more than 1,000 Washington wineries that have followed the company’s lead for decades must now focus on themselves- same. That said, a growing number of wineries are well positioned to do just that.

Ultimately, for many, Ste Michelle and the chateau itself are synonymous with Washington wine. If the company ultimately sells the castle and its grounds, it will leave a hole in the heart of Washington wine that will never be repaired. Also, what is Chateau Ste Michelle if it doesn’t have a castle? The business and brand would surely continue in Woodinville or elsewhere, but the lights would go out on the castle and lands of Ste Michelle.

“Woodinville needs to prepare for the possibility of a post-St. Michelle era,” says one vineyard owner, who preferred to remain anonymous.

CBRE Inc. property listing graphic. Photograph by Richard Duval.

This article has been updated. The original version listed the castle building itself as part of the National Register of Historic Places. This is an error. Instead, the original Stimson Manor and Hollywood Farm are part of the registry. Also, the protection it offers is quite limited.

Shirley M. Pinder