Vineyards Offering

WINERYXREALESTATE

Confidential Offering Memorandum:

Petaluma Gap Winery

& Vineyard +

Russian River Vineyard

More Information Contact

Katie Somple (707) 968-9100

[email protected]

Petaluma Gap WINERY & Vineyard


Winery X Real Estate

TableofContentsSummary ........................................................................................................................................... 1

Petaluma Gap Winery & Vineyard (For Sale) .................................................................................... 4

Salient Facts .................................................................................................................................. 4

Vineyard Map ................................................................................................................................. 5

Vineyard Production History .......................................................................................................... 6

Vineyard Varietal Information ........................................................................................................ 7

Winery Equipment/ Improvements ................................................................................................. 8

Parcel Map ..................................................................................................................................... 9

Petaluma Gap Growing Region ..................................................................................................... 9

Russian River Vineyard (For Lease) ............................................................................................... 10

Salient Facts ................................................................................................................................ 10

Vineyard Map ............................................................................................................................... 11

Vineyard Production Hisory ......................................................................................................... 12

Vineyard Varietal Information ...................................................................................................... 12

Parcel MaP .................................................................................................................................. 13

Russian River AVA ...................................................................................................................... 14

Sonoma Coast AVA ..................................................................................................................... 15

Photo Gallery ................................................................................................................................... 16



Winery X Real Estate Page 1

Summary This offering includes the sale of a two-parcel Petaluma Gap vineyard and winery, together with a

15-year take-over lease of approximately 15 acres of planted vineyards in the Russian River AVA.

The Petaluma Gap Winery and Vineyard is located on Adobe Road in Petaluma consisting of

approximately 60 acres, with a combined 52 acres ± planted primarily to Pinot Noir,(47 acres), with

minor blocks of Merlot, Sauvignon Blanc, Tempranillo, Muscat Chardonnay; Petie Sirah, Pinot

Meurnier and Cab Franc. The vineyard produces on average 170± tons of quality Petaluma Gap

region fruit, grossing on average more than $500,000 annually.

The 3,250 square foot production winery holds a 5,000 case permit with tastings by appointment. It

is currently leased for $64,800 annually, with approximately one year remaining on the lease

(tenant would like to remain). Other winery-related improvements include a 1,500 square foot

covered crush pad with cat-walks and a 2,500 square foot bonded storage barn/event building.

There is also a 1,300 square foot residence that is currently being renovated (market value rent is

estimated at $18,000) and a 2 acre +/- home site that is contiguous to a luxury home development

with gated, private road access.

In addition to the Adobe Road vineyard and winery property for sale, a 15 acre planted leased

Russian River AVA vineyard is offered, with 15 years remaining on a 25 year lease. Average

annual yield is just shy of 100 tons, generating an average gross revenue of $230,000. Annual rent

is based on 20% of the gross value of the crop, which has averaged $47,000 over the past five

years.

The owner of the Adobe Road vineyard/winery and lessee of the Russian River vineyard is

downsizing his many vineyard holdings. He already owns a winery in Healdsburg. The goal of this

packaging is to provide a buyer with a turn key winery and a selection of coveted Petaluma Gap

and Russian River fruit sources to create and produce a premium Sonoma based wine brand.

PetaLUMA GAP WINERY & Vineyard

Russian River VINEYARD


Varietal Total Acres Planted Petaluma Gap

Total Acers Planted Russian River

Combined Acres Planted

Combined Projected Gross Vineyard Income

Pinot Noir 47.5 6.5 54

Merlot .5 .5

Cab Franc .25 .25

Chardonnay .25 5 5.25

Tempranillo 1.25 1.25

Muscat .25 .25

Petite Sirah .5 .5

Sauvignon Blanc 1 1

Syrah 1.5 1.5

Pinot Meunier 2 2 2

Total Planted 51.5 ± 15 66.5 $700,000

The combined assets of this offering provide:

Asset Potential Income

5K Case Winery 64,800

66.5 acres premium Petaluma Gap and

Russian River AVA grapes- (Petaluma

purchased, Russian River 15 year vineyard

lease)

700,000 (selling all fruit at current

contracted values with average yield)

2,500 sq ft Bonded storage and event barn

Small residence 18,000

Valuable 2 acre ± home site surrounded by

vineyards and other luxury homes

(contiguous residence in the private

development on market for $1,650,000)

Landlord style owner’s potential income 782,800 Gross income




Offering price for the combined

properties is $7,500,000.

WineryX Real Estate is the exclusive

representative of this offering. Contact

Katie Somple at (707) 235-8585, or

email [email protected] for

further information.

Disclaimer

Every effort has been made to provide accurate information in this real estate offering memorandum based on

interviews with the seller, and information obtained from other reliable sources. No warranty of information or

statements is implied or expressed.

This summary does not represent or replace legal disclosures of the Seller or Seller’s agent. Buyer is advised to

conduct thorough due diligence on all statements of this Offering and should not rely on information provided.

WineryX has not independently reviewed financial information provided with this Confidential Offering

Memorandum. Only those representations and warranties that are set forth in a binding written agreement

executed by all parties to the contract shall have any legal effect.




Petaluma Gap Winery & Vineyard (For Sale)

Salient Facts

AVA/Region Sonoma Coast/Petaluma Gap

Address 3062 and 3066 Adobe Road, Petaluma, CA

Parcel(s): 017-070-018 29.43 acres

017-070-019 31.34 acres

Total Acres 60 acres

Buildings: 3,250 sf winery;

2,500 sf bonded event and storage barn;

1,500 sf covered crush pad;

1,300 sf farmhouse residence (renovating)

County Use Code Vineyard-Irr W/Res

Soils HcC Haire clay loam, CcA clear lake clay

Winery Permit 5,000 case permit, tasting by appointment

Vineyards 51.5 total planted, 47.5 Pinot Noir, .5 Merlot, .25 Cab Franc, .25

Chardonnay, 1.25 Tempranillo, .25 Muscat, .5 Petite Sirah and 1

Sauvignon Blank

Waste Treatment Two mound systems for winery, standard septic

for Residence

Utilities PGE, Propane, DSL

Water One 200gpm well, city water for residence

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Vineyard Map

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Vineyard Production History

Petaluma Gap Vineyard *Parcel A Production History

Year Total Acres (prior to lot line

adjustment)

Total Tonnage Gross Revenue

2010 31.75 94.62 233,422

2009 31.75 139.9 428,071

**2008 31.75 **26.17 **72,464

2007 31.75 134 348,097

AVERAGE 31.75 ***122.84 ***336,530 *Parcel A numbers above refer to parcel configuration prior to 2010 lot line adjustment **Significant frost damage. Revenue includes insurance reimbursement. *** Average excludes 2008

Petaluma Gap Vineyard *Parcel B Production History

Year Total Acres (prior to lot line

adjustment)


2010 20 73.8 212,942

2009 20 90.35 285,325

**2008 20 **7.98 **27,060

2007 0 (newly planted in 06)

0 0

AVERAGE 20 ***82 ***249,133 *Parcel B numbers above refer to parcel configuration prior to 2010 lot line adjustment **Significant frost damage. Revenue includes insurance reimbursement. *** Average excludes 2008

Petaluma Gap Vineyard COMBINED Production History

Year Total Acres


2010 51.75 168.42 447,364

2009 51.75 230.25 713,396

2008 51.75 *34.15 99,525 (+ $120,000 frost

insurance recovery)

2007 31.75 (newly planted in ‘06)

134 348,097

AVERAGE *177.5 *502,952 *Average excludes 2008 frost damage year

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Vineyard Varietal Information

Petaluma Gap Vineyard Parcel A Varietal Information

Varietal *Total Acres Planted Year Planted Clones/Stock

Pinot Noir 22.5 115 Pommard/777

Tempranillo .75 2009

Tempranillo .5 “T” in 06

Petite Sirah .5 “T” in 06

Sauvignon Blanc 1 “T” in 06

Muscat .25 “T” in 06

Total Planted 25.5 ± *All acreage per varietal is ±

Petaluma Gap Vineyard Parcel B Varietal Information

Varietal Total Acres Planted Year Planted Clones/Stock

Pinot Noir 25

Merlot .5

Cab Franc .25

Chardonnay .25

Total Planted 26± *All acreage per varietal is ±

Petaluma Gap Vineyard COMBINED Varietals

Varietal Total Ac Planted Pinot Noir 47.5 Merlot .5 Cab Franc .25 Chardonnay .25 Tempranillo 1.25 Muscat .25 Petite Sirah .5 Sauvignon Blanc 1

Total Planted 51.5 ±

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Winery Equipment/ Improvements

3,250 square foot metal winery building

5,000 case permit with tastings by appointment

1,500 square foot covered crush pad

Loft office

Handicap compliant restrooms

Rollup Bay for truck/forklift access

Aluminum Catwalks on crush pad

Refrigeration System

Air Conditioning System

480V power

Tasting Room/Lab

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Parcel Map

Petaluma Gap Growing Region

The "Petaluma Gap" is part of the Sonoma Coast AVA, a designated American Viticultural Area,

but is not itself an AVA. The Sonoma County wine industry adopted the term "Petaluma Gap" to

help define its products, since the wind, fog and soils in the Gap give the area's wine a distinctive

character.

Geographically, the Petaluma Gap borders West Marin and Valley Ford on the west, then follows

Chileno Valley and Spring Hill Roads to Adobe Road on the east, Cotati on the north and Lakeville

on the southeast. This is not your normal geography. As inland valley air heats up, it pulls the cool

coastal air into a naturally formed 15-mile-wide "gap" in the coastal range mountains. The wind

flows off the ocean between Tomales Bay and Bodega Bay, builds up speed as it funnels through

the gap, then empties into San Francisco Bay. Wind and fog define the area, giving the term

"micro-climate" real meaning.

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Russian River Vineyard (For Lease)

Salient Facts

AVA/Region Russian River

Address 2938 Mark West Station Rd, Windsor, CA

Parcel(s): 066-280-021

Total Acres Approx 15 acres leased of a 19 acre parcel

County Use Code Vineyard-Irr W/Res

Lease 15 years remaining on a 20 year lease at 20% total gross vineyard income

Vineyards 15 acres ± planted: 6.5±acres Pinot Noir ;2± acres Pinot Meunier; .5± acres Chardonnay;1.5± acres Syrah

Water Shared well agreement will be required. (Seller owns

contiguous vineyard and well).

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Vineyard Map

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Vineyard Production Hisory

Year Total Acres


20% of Gross = Rent

2010 15 92.8 218249 43650

2009 15 112 281024 56204

*2008 15 *49.8 *123191 *24638

2007 15 86.6 209113 41822

2006 15 103 216024 46220

AVERAGE 15 **98.45 **231102 **46974 *2008 frost damage year **Averages exclude 2008 frost damage year

Vineyard Varietal Information

Varietal Total Ac Planted Year Planted Clones/Stock

Pinot Noir 6.5 115 Pommard/777

Chardonnay 5 4/Dijon

Syrah 1.5 Varied

Pinot Meunier 2

Total Planted 15 Recent contractors of fruit include Bearboat, De la Montanya, Piper Sonoma and Moshin

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Parcel MaP

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Russian River AVA

A Cool Place to Grow Grapes

The Russian River Valley climate is sculpted by the regular intrusion of cooling fog from the Pacific

Ocean a few miles to the west. Much like the tide, it ebbs and flows through the Petaluma Wind

Gap and the channel cut by the

Russian River. The fog usually arrives

in the evening, often dropping the

temperature 35 to 40 degrees from its

daytime high. The fog retreats to the

ocean the following morning. This

natural air-conditioning allows the

grapes to develop full flavor maturity

over an extended growing season —

often 15 to 20 percent longer than

neighboring areas — while retaining

their life-giving natural acidity.

Rocks Become Dirt

The geologic history of the Russian River Valley is both active and recent. The collision between

the North American and Pacific tectonic plates caused the uplift of ancient bedrock, which then

eroded. Within the last few million years the eruption of volcanic vents immediately to the east

resulted in the deposition of volcanic ash on the shallow ocean bottom. The resulting sandstone

gave us our famous Goldridge loam soil.

Water flowing off of the Sonoma Mountain range carried with it eroded volcanic material, creating

soils with large amounts of clay in the central portion of the appellation. Then, in what remains a

major mystery to geologists, the Russian River, which once flowed south to what is now San

Francisco Bay, changed course and headed west through the coastal foothills. Along its course it

deposited large amounts of alluvial materials that are now river benchlands. Each of these different

soils has a profound effect on wine produced from grapes grown in this soil.

(Excerpt from www.rrvw.com)

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Sonoma Coast AVA

The growers of the Petaluma Gap strongly support the Sonoma Coast AVA. The Sonoma Coast

AVA is a pleasing mass of contradictions; the coolest region in the county is also one of the hottest

(in popularity that is). Hugging the Pacific Ocean in the north and extending into the Petaluma Gap

in the south, the Sonoma

Coast produces twice the

rainfall of any other region,

yet it's still warm enough to

ripen wine grapes to their

full potential.

Another contradiction- in

the northern part of the

appellation, the vineyards

closest to the Pacific are

located above the fog line.

In the Petaluma Gap, the

vineyards are covered by

fog in the early morning and the late afternoon. Regardless of where a Sonoma Coast vineyard

sits-the Pacific fog works its magic by unifying the Sonoma Coast to produce the richness of flavors

possible when varieties like Chardonnay and Pinot Noir are grown in this beautiful environment.

And we, the Gap growers could not be more proud to be a part of this incredible growing area!




Photo Gallery

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Residence &

Production

Facility at

Petaluma Gap

Winery &

Vineyard

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Documents

Vineyards Offering