Wine and tourism meet investment
A new West Australian winery investment scheme is hoping to create an adult theme park to benefit from the growing tourism push in the Margaret River area south of Perth.
A new West Australian winery investment scheme is hoping to create an adult theme park to benefit from the growing tourism push in the Margaret River area south of Perth.
The Settlement 22 project is offering both a managed investment scheme and the opportunity to take shares in the management company — Settlement 22 Estate.
The investment scheme offers investors 0.05 hectare blocks which are leased from the management company for 16 years with a total investment of $12,650 payable over three years. There is a tax deduction of 59 per cent on the investment and this gives an internal rate of return of 13.17 per cent.
The share opportunity in the estate will give investors ownership of the land, buildings and brand names for the vineyard. The minimum number of shares an investor can buy is 2035 at a price of $1.80 per share. The internal rate of return will be 17.58 per cent based on cash flows and projected brand and land values at the end of the investment scheme in 2016.
Settlement 22 chief executive Cedric Williamson says the wines will be aimed at the premium end of the market, with both reds and whites becoming available in years to come.
Williamson says the winery is looking to obtain a reputation for fine wines such as that achieved by nearby Moss Wood. Its wines can now sell for up to $300 a bottle and is regarded as one of Australia’s best winemakers.
“It is our intention to put a lot of money into the export market and winemakers like Moss Wood achieve a quality we can aspire to,” Williamson says.
To leverage off the boom in tourism to the Margaret River area, the company is planning to show people how wine is made at the vineyard.
“We will also teach people how to taste wine with cellar door sales,” Williamson says. “It is a unique concept — an adult theme park where the theme is wine.”
This part of the scheme is aimed at baby-boomers who are learning to appreciate better-quality wines as they grow older, Williamson says.
“Wine has become a lifestyle product and the baby-boomers are growing the premium end of the market, creating upward pressures on price in this segment.”
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