Countdown to Kluge auction continues

Naturally, it didn’t take long for Patricia Kluge’s news to spread, like red wine on a white linen tablecloth. More than two weeks ago, C-VILLE broke the story that Farm Credit of Virginias have foreclosed on Kluge Estate Winery and Vineyard, Albemarle’s largest winery, which is owned by Kluge and her husband Bill Moses. Kluge and Moses owe the bank nearly $35 million on the property that includes 164 acres under vine. The bank filed a civil suit, too, alleging fraudulent transfer of property into a trust for her son (Kluge and Moses’ attorney calls that charge “ridiculous”).

“Certainly, bringing a winery that is in trouble to someone’s attention would be part of our job in promoting the Virginia wine industry,” State Secretary of Agriculture Todd Haymore says, “but I’m not sure there is anything else the Governor’s office or I can do for an individual winery.” Kluge has 164 acres planted with grapes. The auction of the land, buildings and equipment is scheduled for December 8.

And the news got worse and worse over the past two weeks. NBC29 first reported that Kluge heads the class of property tax delinquents in Albemarle County with an unpaid tab of $86,000. Then, C’ville Bubble Blog reported that Kluge and Moses had dropped the sale price on Albemarle House, their 45-room mansion on Blenheim Road, to $24 million (Bank of America holds a lien for $22.8 million on that property). When they first put it on the market about a year ago, the asking price was an incredible $100 million, which came down within months to $48 million, though it still attracted no buyers at that price. 

By the time Wine Spectator picked up the Kluge news, there seemed to be a glimmer of hope. “Virginia Gov. Bob McDonnell, an avid wine enthusiast, is reportedly attempting to interest the Altria Group, which owns both Chateau Ste. Michelle in Washington and Philip Morris tobacco, in a deal with Kluge,” the magazine reported in an unbylined online story on November 4. Not exactly, says Virginia Secretary of Agriculture Todd Haymore. 

“We are reaching out to a number of companies both domestically and internationally to ask them to look at the Virginia wine industry,” says Haymore, “to look at the land that is producing these grapes that are producing these wines.” He confirms that Altria is among those companies. But, he adds, “We have had no specific conversation about any winery. It’s been a very broad discussion about the Virginia wine industry.”

Haymore confirms that Kluge and Moses reached out to the McDonnell administration, adding, “it’s unfortunate what’s going on with Bill and Patricia and we hope for the best.”

“Certainly, bringing a winery that is going out of business or is in trouble to someone’s attention would be part of our job in promoting the Virginia wine industry,” Haymore says, “but I’m not sure there is anything else the Governor’s office or I can do for an individual winery.”

Meanwhile, Haymore says, Moses has resigned from the Virginia Wine Board, though at press time Moses’ name was still listed among the 10 members on the state’s official wine website,

Kluge Estate Winery and Vineyard is scheduled for auction on December 8 at the property. A separate auction of some 15,000 cases of Kluge wines is scheduled for December 11 at The Warehouse in Madison County. That stock includes vintages dating to 2004 and is restricted to businesses with an ABC license, such as restaurants and wine shops.

While Kluge may still be searching for a white knight, Sweely Estate Winery, which was also facing foreclosure a couple of weeks ago, has reached an agreement with its lender, Sun Trust Bank, and the auction of that Madison County property, which includes a capacious event building and 295 acres (40 of those planted with grapes) has been canceled. There will be “no change in operations,” says owner Jess Sweely.


Previously: Foreclosures hit two big local wineries

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