Saint-Émilion Re-Classification Rocks the Right Bank

by Westgarth Wines September 12, 2012

After eighteen months of work supervised by the Institut National des Appellations d’Origine, or INAO, the re-classification of the Bordeaux wine region Saint-Émilion has been approved. For wine investors, the most interesting change is the promotion of Château Pavie and Château Angélus to the highest possible rank. According to an INAO statement, the upgrade was granted in recognition of “their consistency in quality and their quest for excellence.” The Saint-Émilion appellation previously only held two Premier grand cru classé A wines: Château Ausone and Château Cheval Blanc. The addition of two more wines to the highest Saint-Émilion grading is surely the result of improvements in viticulture , which have led to an increase in the frequency of great vintages in recent years.

Gerald Perse, the owner of Château Pavie, has had a significant impact on the success of the estate. He purchased Pavie in 1998 for $30.8 million, a figure dwarfed by last year’s valuation by the London International Vintner’s Exchange, which put it on a par with Château Angélus at just over $200 million. Perse’s efforts have been particularly noted by influential wine critic Robert Parker, Jr., who rated ten of the last twelve physical vintages at above 95 points, and described the Pavie 2000 as, “unquestionably one of the most monumental wines Bordeaux has ever produced.”

Fine wine investors will be aware that last year the case prices of Saint-Émilion’s Cheval Blanc and Ausone averaged $8,500 and $17,500 respectively, while Pavie and Angélus were valued at only $2,700 and $2,880 per case. The reclassification announcement on September 6th has already begun to change things, as the quality and consistency of Pavie and Angélus is officially recognized to be on a par with the other two appellation leaders. The two labels are sure to become more highly sought-after at their current, relatively undervalued price. Collectors and investors both know that now is the time to buy Pavie and Angélus. And for you, the resulting supply and demand imbalance means fantastic potential in terms of capital growth.