North Bay Business Journal

Monday, December 31, 2012, 6:45 am

Top stories of 2012: Happier times for wine

Also: New players in health care; Marin loses Grady Ranch

By Eric Gneckow, Jeff Quackenbush and Dan Verel, Business Journal Staff Reporters

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    Befitting one of the world’s leading wine regions, wine played prominently in the Top 10 Stories of 2012 selected by the Business Journal editorial staff.

    Two of this year’s top stories came out of the wine industry: The near-perfect 2012 harvest and, secondly, a flurry of acquisitions.

    But there were plenty of other big stories of 2012 in the North Bay, among them the stunning withdrawal of of Lucasfilm’s Grady Ranch studio project; the return of Basin Street Properties’ dominance in the commercial real estate market, and the entrance into the market of new health care insurance options for the first time in many years.

    There were big stories in addition to the Top 10, such as the November acquisition of Novato’s Circle Bank by Portland-based Umpqua. We even made news late this year when the Journal, Press Democrat and Petaluma Argus-Courier were acquired by locally-owned Sonoma Media Investments LLC. 

    We look forward to more big stories in 2013. For now, here are the Top 10 Stories of 2012:

    1. Wine grape harvest biggest in years

    The North Coast winegrape season was not too hot, too cold or too wet. Combined with steady demand for grapes and wine following two short crops, the industry found itself in a situation rare in recent years: The harvest was possibly the largest since 2005 and a number of wineries were eager to find room to buy as much as they could.

    Trefethen Vine;yards workers harvest chardonnay grapes before dawn.

    The first official tally of tonnage and grape pricing won’t be known until the state releases preliminary figures in early February.

    In Napa County, the expectation for 2012 tonnage was 30 percent above growers’ multiyear averages until grapes for sparkling wine started coming off vines a month and a half ago, and now the typical outlook is between a grower’s average and plus 10 percent, according to trade group Napa Valley Grapegrowers. Average yield from feedback the association has received is about four tons an acre, ranging from 2.5 an acre on hillsides to as many as seven tons an acre in a few places by the Napa River.

    If the average yield estimate bears fruit, it would amount to about 174,000 tons, based on nearly 43,600 bearing acres of vines reported to the Napa County Agricultural Commissioner last year. That would put it between the sizable 2006 crop of nearly 153,000 tons, yielding 3.6 tons per acre, and the huge 2005 crop of 181,000 tons, yielding 4.3 tons an acre, according to the county crop report.

    By comparison, the cool season and rainy finish of the past two years significantly reduced Napa County crops. Last year’s harvest of almost 122,000 tons had a yield of nearly 2.8 tons per acre, and the 2010 crop weighed in at almost 139,000 tons, or 3.2 tons an acre.

    Like the the post-harvest forecast for the 2012 crop in Napa County, the outlook for Sonoma County tonnage also is in the 2005–2006 tonnage range, according to Sonoma County Winegrape Commission. In 2006, 216,000 tons were harvested, and in 2005, 230,000 tons, corresponding to yields of 3.9 and 4.2 tons per acre.

    The outlook for the 2012 crop is at least 220,000 tons, or an average of around 4 tons for each of the county’s nearly 60,000 bearing acres. The last two weather-hampered seasons in Sonoma County resulted in crop sizes of almost 167,000 tons last year, or 2.9 tons an acre, and 192,000 tons in 2010, or 3.4 tons an acre.

    Based on grape purchase pricing earlier in the 2012 season for a number of varieties and greater tonnage, Sonoma County growers could have $100 million more in grape revenue than last year, the commission estimated. 

    Jeff Quackenbush

    2. Lucas pulls plug on Grady Ranch, plans residential development

    Plans to construct affordable housing on a portion of George Lucas’s Grady Ranch property northwest of San Rafael have entered a new phase in 2012, with planners now looking for a developer after the filmmaker withdrew former plans to build a  state-of-the-art digital movie studio at the site.

    Lucasfilm Grady Ranch

    Filmmaker and Marin resident George Lucas wants to build this 123,000-square-foot office building and digital movie studio on his Grady Ranch property off Lucas Valley Road near San Rafael. (click to enlarge)

    Mr. Lucas and his real estate company, Skywalker Properties, withdrew their long-awaited plan in April, citing continued opposition from neighborhood groups as a major driver of the decision. The two-year construction phase of the 270,000-square-foot studio was expected to pump $268 million into the local economy, create 690 construction jobs and generate $5 million in combined state and local sales tax revenue. Further benefits were expected from long-term jobs created through the studio.

    The company released a public letter that recommended the site instead be slated for affordable development, a gesture that many interpreted as a tongue-in-cheek affront to opponents of the studio project.

    Yet the company moved forward with those plans, asking the Marin Community Foundation to spearhead the effort and providing the foundation with land and engineering studies that could help jump start construction for a future developer. Early discussions with county planners have indicated that between 200 and 300 affordable units could be constructed at the site, and a request for developer qualifications is due in mid-January 2013.

    Eric Gneckow

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