The British may be suffering a crisis of confidence at the moment but one field in which we continue to lead the world is professional wine storage. (A shame this doesn’t qualify as an Olympic sport.)
The combination of a cool climate, centuries-old prowess in fine-wine trading and some recycled underground munitions dumps has led to an exceptional number of wine collectors worldwide deciding to store their precious bottles in bonded warehouses on or, often, under British soil. The late Baroness Philippine de Rothschild used to swear that bottles of her Ch Mouton Rothschild stored in the cool climes of the UK tasted better than those stored in Bordeaux.
Some American wine enthusiasts keep at least a part of their collection in the UK. California collectors were shaken in 2005 when the operator of a Bay Area storage business, hoping to destroy evidence of his chicanery, set fire to a warehouse, effectively cooking 4.5 million bottles of fine wine.
But British storage professionals are under increasing threat from global competition. Since Hong Kong cut its duty on wine to zero almost exactly 10 years ago, it has become Asia’s fine-wine hub. In the old days, the colony’s connoisseurs would routinely store their wine in the UK — not least because until 2004 there was not a single professional storage facility in Hong Kong. Today, no fewer than 44 wine warehouses are officially registered with the Hong Kong authorities.
Red bordeaux is the prime wine investment commodity. Private buyers who would have stored their wine in the UK in the past are now being encouraged to leave it in one of the bonded warehouses that have been proliferating in the suburbs of Bordeaux. Not only are merchants such as Duclot, Joanne and Millésima offering storage as part of the package, there are custom-built facilities such as Bordeaux City Bond designed expressly for international private clients.
With the exception of LCB Dinton — 15 reconditioned Ministry of Defence bunkers near Salisbury transformed into wine storage — most recent entrants to this field are above ground. This means considerably higher energy costs, but less risk of excess humidity.
Temperature is critical for wine storage, with a constant 13C/55F considered ideal — and anything higher than 20C potentially harmful, especially to the most delicate wines. The warmer the storage conditions, the faster a wine is likely to age. Much lower than 0C and the wine may freeze and expand, disastrously pushing the cork out of the bottle neck. Few homes nowadays incorporate perfect wine-storage space.
Wine likes humidity because it keeps corks damp but wine buyers, particularly in Asia, prefer their labels pristine, so a relative humidity of about 70 per cent is considered ideal.
The leading British above-ground storage facility, LCB Vinothèque, housed in a solid Victorian ex-maltings in Burton-on-Trent, boasts of being “the only major wine warehouse in the UK with full climate control”. LCB stands for London City Bond, whose working stocks for the trade are held in Barking, east London.
Their big rivals are Octavian, whose ex-munitions dump near Corsham, Wiltshire, is so far underground that a rack-and-pinion railway is needed to transport cases of wine in and out. Not that that much wine moves here. Many a wooden case changes hands every few years — perhaps between customers of the same UK merchant, or a Singaporean may put the wine into auction in London and sell it to an American — but the case itself sits undisturbed beneath the turf and simply has a new identifying label stuck to it.
Temperature is critical. The warmer the storage conditions, the faster a wine is likely to age
For the private customer to retain ownership it is vital that each lot of wine is specifically identified with the individual who owns it, as was demonstrated when a couple of UK wine merchants went belly up in the late 20th century. This is important in view of the many UK wine merchants who encourage clients to store wine with them (in most cases with a third-party specialist warehouse, in fact) and who then go on to encourage them to trade wine among themselves. As LCB’s Jeremy Pearson puts it, for them, “today’s en primeur sales are tomorrow’s broking sales”.
One of the few British wine merchants to operate their own bonded warehouse is Seckford, in Suffolk, whose rates are thus very competitive. The same is true of The Wine Society, although their modern premises on the outskirts of Stevenage, Hertfordshire, are now so full that they will store only wine bought from them.
Another merchant going the extra mile, though storing with Octavian, is Private Reserves, run by Laura Goedhuis, the wife of wine merchant Johnny Goedhuis, who notes that recently a number of former OW Loeb clients have moved their cellars into Private Reserves. To celebrate their 30th anniversary, Private Reserves are offering an amnesty on landing fees and storage charges for anyone switching to them before April 1 this year. From April their storage rates will be a VAT-inclusive £13.50 a year for a case of 12 bottles and a six-bottle case rate of £6.75. LCB charge by the single bottle.
When we at jancisrobinson.com tried to compile a guide to wine storage, we found more than 100 schemes in 13 countries, 28 of them different offers from various UK merchants and logistics companies, shared between a handful of facilities. Schemes vary according to how easily and cheaply wine can be extracted and delivered. You could go crazy comparing the deals. I have cited here some prominent storage facilities.
Many offers include insurance (Octavian’s is up to £500m per individual), but when LCB looked into insurance policies, they concluded that the only failsafe option is to have policies in individual clients’ names. They now offer a reduction in case rates plus insurance policies for different total valuations (£100 a year covers wine worth £50,000, for example).
UK storage schemes increasingly offer valuations by fine-wine trading platform Liv-ex, as well as online access to individual accounts and collections. Alas, crooks are just half a step behind, so it’s worth asking about security systems before choosing your storage.
Some notable wine-storage facilities
- LCB Vinothèque
- Locke-King Vaults
- The Wine Society
- Berry Bros & Rudd
It is common for serious American collectors to build their own cellars.
- Domaine Wine Storage, DC
- Western Carriers, NJ
- Bordeaux City Bond
- Crown Wine Cellars
- Wine Ark
Many more at jancisrobinson.com/learn/where-to-store
Recent developments in fine-wine storage (as reported by Octavian)
- A substantial increase in private customers buying for investment.
- Many more requests for detailed information and on-site visits.
- Since 2012, requests for photographs of bottles (to see condition, fill level etc) have increased from 500 to 7,500 monthly.
- Pack sizes have diversified. In 2012 more than 80 per cent of wine stored was in 12-bottle cases but that proportion is now about 50 per cent.
- Security identifiers on cases of valuable wines are more common and require more time and effort to check — a case for the introduction of an industry standard?
- At least one loan of $50m has been negotiated with a US bank by a private customer using part of a wine collection held at Octavian as collateral.
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