Majestic, magnificent and mythical. A wine so loved that Ernest Hemmingway named his daughter after it. One of the original fab four voted the best wine in Bordeaux in 2015, James Suckling described it as “the best ever made”… Yes, you’ve guessed it, it’s Chateau Margaux. “There cannot be a better bottle of Bordeaux than a bottle of Margaux,” Thomas Jefferson famously said, and to a certain degree, he was right.
More about Château Margaux
Chateau Margaux is one of the rare cases where the hype does not do enough justice to the product. Not only does the Left Bank big player belong to the original group of first growths, but it has also been consistent in making great, great wine for over 40 years. Which very easily translates into great, great returns on your investment.
We all know the name is synonymous with excellence, but despite Margaux’s first growth status, the wine has surprisingly not always enjoyed the stellar reputation it has today. In fact, in 1984, it was ranked at only 441 of France’s 500 best wines, a figure that had risen to 4 by 1997. Today, it ranks at number 7 on Liv-Ex Power 100 scale – a modern classification scale that lists the most powerful fine wines in the world, according to data that calculates their marketplace real-time value (other scales list the most influential wines in France, in Bordeaux, in Italy, the most powerful red wines etc.) But with wine as famous as Margaux, borderline, it doesn’t matter where it ranks – it is, quite simply, one of the best wines in the world. Whether you prefer to keep it in your portfolio as an asset or on your table for drinking is up to you, you won’t be disappointed either way.
In order to understand how Margaux turned its fortunes around, we must thank André Mentzelopoulos, a Greek businessman who bought the Haut-Médoc estate in 1977. The estate had been producing subpar wine since the mid-1950s, brought on no doubt by poor management, lack of funds and post-war austerity. Mentzelopoulos invested heavily in replanting new equipment and staff, bringing in noted wine consultant Emile Peynaud. Sadly Mentzelopoulos died before he could see the (literal) fruits of his labour, but the clever handling of the estate by his daughter Corinne saw Chateau Margaux on the way to becoming what we know it as today – a superlative Bordeaux wine, capable of reaching astronomic prices, as well as being one of the most coveted (and counterfeited) wines today.
Chateau Margaux’s stellar ascent continued in 1983, when lead winemaker Paul Pontallier made even more changes, including new vats, a gravity-fed reception area, a second round of hand-sorting to select only the best grapes, plot-by-plot vinification to more precisely blend the final grand vin, new state-of-the-art cellars and additional red wine labels (including a second and third wine). Under Pontallier’s steerage, the chateau now produces four wines:
Château Margaux: The estates grand vin, and the famous first growth that gives Margaux the stellar reputation it enjoys today. Production is 12,000 cases per year. The flagship wine is made from approx. 85% Cabernet Sauvignon, 20% Merlot, 3% Petit Verdot and 2% Cabernet Franc Expect a rich, full-bodied wine full of complex flavours with unbeatable (up to 50+ years in some cases) ageing ability.
Pavillon Rouge du Château Margaux is the estate’s second wine – but that does not mean second best. The breakdown is more or less the same as for the grand vin but it is made from secondary grapes, and the quality has become very close to that of the flagship wine. The estate produces 16,000 cases per year. It’s not as complex or age-worthy as the grand vin, but it is still a powerful wine.
Pavillon Blanc du Château Margaux (1,600 cases per year): A white Bordeaux made from 100 per cent Sauvignon Blanc. Although high in quality, it isn’t officially classified under the Margaux appellation because Sauvignon Blanc doesn’t fall under AOC regulations. Currently trading at almost €400 / bottle.
Margaux du Château Margaux (varies from year to year): A third red wine blend that is less complex than the grand vin and Pavillon Rouge. It’s not as complex or age-worthy as the grand vin or Pavillion Rouge, but it is still a powerful wine. It’s the newest addition to the Margaux family.
Is it worth investing in wine from Château Margaux?
There is no denying that from an investor’s point of view, you will make money on Margaux. Since Mentzelopoulos’ original investment, Margaux has restored it’s status as one of the most outstanding wines in France, and the fact that it remains under single (and private) ownership signifies good things for the estate.
It should not go unnoticed that Chateau Margaux has had an office in Hong Kong since 2010. This effort to tap into the Asian market will no doubt cause a certain amount of consternation for European wine investors – after all, the fine wine investment market in Asia is currently the world’s fifth and investors have the perfect storm of lots of capital, high social expectations and increasing consumer demand. Château Margaux’s efforts to tap into the growing China wine market have grown steadily in recent years as Premier Cru peers like Lafite Rothschild, Latour, Haut-Brion and Mouton Rothschild have also become auction favorites for mainland Chinese bidders in Hong Kong.
The fact that China is Chateau Margaux’s second market in terms of volume and may soon become the first and the Hong Kong office shows that the company is enthusiastic about the Asian market. Chateau Margaux’s managing director Paul Pontallier appointed his son Thibault to head the Chinese wing of the company, and it looks like he is doing a stellar job, notably with the estate’s second wine, Pavilion Rouge. For example, the 2014 vintage of this second wine had a CAGR (Compound Annual Growth Rate) of 17%, the second highest of the year.
Investors that are interested in Margaux should note that specific circumstances can also drive prices up. Most recently, the vintage extraordinaire from an investment point of view was the 2015. The good, but not great, vintage has skyrocketed in price since its release in the UK, perhaps due to it being the year estate director Paul Pontallier died (2019 prices are close to €15,103 a case). Clearly, the vintage is a spectacular wine, but the real gold lies outside the bottle. The vintage is of particular value as the label was redesigned for the occasion, with the phrase Hommage a Paul Pontallier in small letters on the bottom. Investors should note that average points for the 2015 are high, but not perfect, with an aggregated score of 97/100. However, the 2015 still commands a higher market value than 100-pointers such as the 1990 or the 1996. Wherever you land with Margaux, it is rare that you’ll be disappointed.
Chateau Margaux and En Primeur
Margaux’s brand positioning as an “exclusive, outstanding, best of the best quality wine sold only to top luxury buyers” has got them far. The estate focuses on quality and makes wines from the best grapes available, which has given them the unbeatable reputation they now enjoy. This reputation has allowed them to trade “foolproof” in the En Primeur or Futures market.
If you are unfamiliar with the En Primeur (EP) market, then the way it works is as follows:
Unlike buying a pair of shoes or your weekly shopping, buying EP means that you don’t actually walk away with your purchase. Called Futures in English, the practice carries its name well; you are literally buying the future.
En Primeur wines are tasted by professionals who deliver their verdict in early May, 12-18 months prior to the wine’s bottle release date. The idea is that the chateaux sell the previous year’s harvest after it has fermented and been transferred to its ageing barrels but has not yet completed its initial maturation. The chateaux take an educated guess on their wine; working on the weather conditions, the skill of the winemaking team and the chateau’s history, they release the wine “en primeur”.
This type of investment is win-win; investors get a head start on the vintage, accepting a gamble on the ageing ability based on statics and data rather than the actual wine. The chateau gets an early injection of cash which permits them to continue to run the estate.
Margaux has a long and successful history of selling EP, so if you are thinking of investing in the wine, EP could be a good place to start.
As with all things investment-related and notably fine wine related, it is worth doing your homework. For example, the 2017 release price was significantly lower than 2016 (by 17%) 2017 at €407 per bottle was already up nearly 30% less than 24 months later.
The current (2021) EP wine is selling for €247 a bottle on Vindome.net’s Live Market. If that still doesn’t wound like a good opportunity, then note that Château Margaux released its 2020 futures on 22 June 2021 for €432 per bottle, ex-négociant, which was an increase of 30 per cent on the 2019’s opening price. The wine is not yet available on the secondary market, but with almost perfect scores of 100/100 from James Suckling, 99/100 from Robert Palmer, 99/100 from Decanter and 98/100 from Jeb Dimmuck, we have no illusions that the bottle price will retail at least 25% higher than the initial investment.
Which vintages are best for investment?
Chateau Margaux’s long, storied history, plus its superb quality means that good, great and excellent vintages are par for the norm. What’s more, perfect 100-pointers are commonplace. With so much on offer, it is rare that you would be disappointed, whatever the vintage. In a nutshell, investing in this wine means investing in an incredibly valuable wine, which regularly tops the leaderboard and can command prices of over €15,000 a case.
Because Chateau Margaux’s quality is so high, some vintages can be hard to come by (please always contact email@example.com if you cannot find a specific vintage, and we will source it for you).
Recent legendary vintages include:
- 2019: A perfect trinity of 100 points from Wine Enthusiast Jeb Dimmuck and Robert Parker’s Wine Advocate. This vintage is almost impossible to find on the secondary market, so please contact us if you’re looking to add it to your portfolio.
- 2018: Another beauty from the stable of Margaux. Scored 100 points by the holy trinity of Wine Enthusiast, Jeb Dimmuck and Robert Parker’s Wine Advocate. A must-have for any serious wine collector.
- 2015: A simply superb wine with an outstanding score: 100/100 from Wine Enthusiast, 100/100 from James Suckling, 100/100 from Decanter.com, 99/100 from Robert Parker’s Wine Advocate and 99/100 from Wine Spectator. Not bad!
- 2010: A great vintage from the barrel to the bottle. Beautiful texture and spellbinding aromas make it one of the most drinkable Chateau Margaux’s available on the market today. Get if for your portfolio now and sell in a few years as it will only get better and better. Points: 100/100 from Wine Enthusiast, 100/100 from James Suckling, 98/100 from Robert Parker’s Wine Advocate and 98/100 from Wine Spectator.
- 2009: A very, very good wine that entered its drinking window in the past couple of years. It is beautifully deep garnet in colour and features wonderfully fragrant secondary and tertiary aromas such as minted cassis, lilacs and black forest gateau. Scored very well, as expected: 100/100 from Decanter.com, 99/100 from James Suckling, 98/100 from Wine Enthusiast, 98/100 from Robert Parker’s Wine Advocate and 97/100 from Wine Spectator.
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