Storage & Investment

Storage

When I think about my ideal storage, I imagine living in a vast castle perched atop the deepest dungeons where the atmosphere is kept perpetually damp and cool through its proximity to the surrounding waters of the castle's moat and from where a resilient cat banishes mice that would otherwise be nibbling at the corks of my 1964 Krug.

Not everyone is this fortunate, however. Still, what is important is that one has the facility to enjoy, not just the fruit of one's collecting, but the collection itself. Also, that the conditions in which one's wine is stored be as close to perfect as possible. 

Bowes Wine outsources its company and client storage to Octavian, the biggest and best wine storage facility in the UK by some margin. Octavian used to be a mine. In fact, it was the mine from which was dug the stone employed in the building of the City of Bath. So all this wine is kept 100 feet below ground, enclosed by millions of tons of limestone and maintained in a cool, dark, vibration-free environment.

Clients have a choice of three accounts in which they can store their wine in Octavian (although there is no obligation to use this facility; wine bought from Bowes Wine can be redistributed to the client’s preferred location and for a nominal fee – see our Terms & Conditions for delivery charges).

1.  Bowes Wine Client Trust Account

The contents of this account are ring-fenced, so as not to make up any part of the assets of Bowes Wine. Its contents are scrupulously recorded by Octavian and Bowes Wine, with individual client records logged by Bowes Wine; records that are backed up remotely on a daily basis. This is the cheapest option for client storage - £9.70 per case (12x75cl or 9 litre equivalent) / £7.15 per half-case (6x75cl or 4.5 litre equivalent) per annum including VAT and insurance at full replacement value.

2.  Bowes Wine Multi-Owner Account

Individual ownership is acknowledged and recorded by Octavian and each case held in the account displays the owner’s name and that ownership is recorded on Octavian's database. However, Bowes Wine is held responsible by Octavian for all charges relating to this account, storage charges being paid by direct debit from the Bowes Wine company bank account. Octavian will only take instructions relating to transfers and withdrawals for wines in this account from Bowes Wine. Therefore, clients have to sign a contract  with Bowes Wine authorising the company to act on their behalf. Administration fees for this type of account are greater, therefore storage charges are higher for the multi-owner account - £11.25 per case (12x75cl or 9 litre equivalent) / £7.70 per half-case (6x75cl or 4.5 litre equivalent) per annum including VAT and insurance at full replacement value.

(Wines in magnums & larger formats will be charged at the 9 litre rate.)

3.  Own account at Octavian

Bowes Wine can introduce clients to Octavian, for them to open their own private accounts. This is the most expensive way to store wine, but some clients like the peace of mind that this affords.

To help our clients enjoy their collecting more, those storing wine with the company are provided with a portfolio - in effect a certificate of ownership - that displays all details of the wines, including wine name and origin, original purchase price, when the wine should be consumed (expressed as a span of years i.e. 2008-20), as well as Octavian's rotation number, which describes the exact location of that wine in their labyrinthine cellars.

Investment

Like it or not, wine, at the topmost levels, is an art form. Not created by some human genius (or, as seems to be an increasingly frequent phenomenon these days, by someone with no evident talent whatsoever), it is rather the expression of some complex subtlety underlying the soil, situation and micro-climate of a specific vineyard.

Again, like it or not, art is a highly tradeable commodity and much as it pains me, as a wine merchant, to see the finest products of the rarest vineyards passed around like so many pork bellies, it is a fact of life.

The reasons for wine's suitability as an investment instrument are pretty obvious. Here are some of them:

·          The number of people in the world for whom wine is an aspirational, luxury product is growing; demand is rising, whilst supply, at least of the top wines, is regulated and controlled by law.

·          Wine is deemed by the Treasury to be a wasting chattel and, as such, is not liable to capital gains tax in the UK.

·          Because investment grade wine is, uniquely, a pleasure for which one has to wait, as soon as it attains its optimum condition, many of those who own that particular wine will start to drink it. Thus the global supply will shrink. It is at this stage that, given favourable conditions in the global economy as a whole, wine starts to appreciate in value.

Anyone interested in purchasing wine as an investment, please do contact Caspar.