Donald Trump Invests in Wine Country
By May 4, 2011 0 797•
Vineyards conjure images of grandeur: rolling hills of grape vines, lavish dinner parties at million dollar homes, a sort of bohemian wealth and influence. Sometimes though, it can come to a roaring halt when those same vineyards that supply the grandeur fail in a way Mother Nature could have predicted.
Patricia Kluge, famed socialite who married rich, divorced nine years later and settled for the Charlottesville Mansion and nearly $1 million a year and then remarried, is again under fire after her $3 million house foreclosed this month.
In February, Albermarle, a 200-acre and 45-room estate built by her late husband, John W. Kluge, was repossessed by creditor Bank of America for $15.3 million.
It all started when Kluge established Kluge Estate Winery and Vineyard on 960 acres in Charlottesville. She took out $65 million in loans to expand wine production and to build luxury homes on half the land. Then the bottom dropped out and she found that she could only sell half of what they anticipated. She defaulted on $35 million in loans. Over the past three years, Kluge lost Albermarle (originally valued at $100 million, now on the market for $16 million), $15.1 million worth of jewelry, and plenty of art and furniture to pay her debt and then the winery.
On April 7 billionaire Donald Trump bought half of the land, including the winery, for $6.21 million, the other half going to Loudoun developer Sal Cangiano for $1.2 million. Trump told the Washington Post he sees the purchase as a great real estate deal, but not as an opportunity to continue the great wine making of Kluge. “I’m really interested in good real estate, not so much in wine,” he said.
Trump is also interested in Albermarle, for which they hold the First Right of Refusal, though general counsel for the Trump Organization Jason D. Greenblatt told Forbes, “Ultimately we’d like to buy the home, but the bank has an unrealistic expectation for the purchase price.”
Whatever the outcome of the land, Trump’s made it clear that he wants Kluge to stay on in some capacity at the vineyards, though there’s been speculation about a possible golf course. Kluge will no longer own her 960 acres of land, two homes or a reputation as a wine maker.