Founding Patz & Hall winemaker repurchases Sonoma Valley winery

James Hall, one of the founders of Patz & Hall, known for its vineyard-designate chardonnay and pinot noir wines, has bought back the Sonoma Valley winery after its sale eight years ago.

Hall and two unnamed partners purchased the brand from Washington-based Ste. Michelle Wine Estates Monday for an undisclosed price. The deal included the brand, inventory, equipment and lease of the Sonoma House tasting room and winery at 21200 Eighth St. E. just outside the city limits. Hall himself is part of the ownership of the winery real estate.

Hall had been winemaker since Donald Patz, Anne Moses, Heather Patz and he started the business in 1988 and continued on in the role after the winery sold to Ste. Michelle in 2016.

Hall said that other than some input on case-production targets Ste. Michelle gave him latitude in aesthetics of the wine and how it was produced.

But last year as he was planning succession, Hall brought in as senior winemaker James McCeney, who had been assistant winemaker in 2012 and 2013.

“Last year, I turned 65, and I wanted to move away from the day-to-day winery operations — more into a winemaker emeritus role, working with vineyard relations, blends, barrel selections, things like that,“ Hall said.

He also has hired a management, marketing and sales executive team, but he’s keeping specifics to himself until all agreements post-sale are finalized.

Ste. Michelle has been scaling back certain assets and expenses since private-equity firm Sycamore Partners purchased Ste. Michelle from tobacco giant Alturia in October 2021 for $1.2 billion, also picking up California brands Stag’s Leap Wine Cellars and Conn Creek.

In June of last year, Italian wine producer Marchesi Antinori expanded its long-held minority stake in Stag’s Leap Wine Cellars to acquire it. Then that August, Ste. Michelle told Washington state grape growers it would buy 40% less fruit over the next five years as part of cost-cutting measures, according to Decanter.

Then eight months ago the opportunity to purchase Patz & Hall emerged, and Hall said the partnership put in a bid.

Ste. Michelle will remain involved with Patz & Hall distribution for at least the next several months.

Annual production currently is 40,000 cases from the 2022 vintage, with a bit more anticipated from the large 2023 harvest. Suggested retail for chardonnay is $45–$70 a bottle.

A primary focus for brand sales is wine by the glass at restaurants and other on-premises-consumption venues, Hall said. But the pandemic has resulted in a different marketplace, with a number of venues closing and significant changes in pricing and business concepts, he said.

And there’s added on-premise competition now from spirits brands, particularly for craft cocktails. But Hall said in his four decades in the business, there have been other threats, such as imported wines or recessions’ impact on spending.

“In the wine business, there is always ebb and flow,” Hall said. “By the nature of it, there is always a risk and also an opportunity. A lot of small wineries are doing extremely well.”

Going forward, Patz & Hall will lean into Sonoma Coast chardonnay, sales for which have been performing “very well.”

“We believe there has been a lot of consolidation in premium coastal chardonnay in California, and taking the winery private will give us an edge with independent restaurants and shops,” he said.

Jeff Quackenbush covers wine, construction and real estate. Reach him at jquackenbush@busjrnl.com or 707-521-4256.