Mount Veeder vineyard hit with foreclosure notice
A Mount Veeder vineyard belonging to Alpha Omega Winery may be on the market again, a move triggered after a foreclosure notice recently sent to the winery.
The winery and the former owners have decided to collaborate to the hillside property, even at a loss, to avoid foreclosure proceedings.
Alpha Omega bought the Mount Veeder Road vineyard in 2020 from Larry and Collette Stricker for $8.8 million. The Strickers were paid $6 million cash and carried a $2.8 million note under a seller financing arrangement secured by the nearly 40-acre property, according to Robin Baggett, owner and founder of Alpha Omega, as well as public records.
The property, which also includes a residence designed by Stricker, an architect, also carried a note at F&M Bank with an outstanding balance of about $4.2 million. Baggett said he has continued making $32,000 monthly payments on that note.
Late January, the Strickers signed a Notice of Default after Alpha Omega failed to make payments on their loan. It now has an outstanding balance of about $2.3 million, according to public records and Baggett.
The Strickers filed the Notice of Default on Feb. 2 with the Napa County recorder and county clerk, triggering foreclosure proceedings.
Baggett recently said he stopped making payments on the Strickers’ note three to four months ago, saying Alpha Omega could not “continue to throw good money after bad.”
Real estate agents have estimated the sale cost of the vineyard would be below $6 million, Baggett said, adding that the total debt secured against the property is $ 6.558 million.
Basically, the issue is the devaluation of the vineyard, Baggett said. “It used to be worth a lot. It’s not worth a lot now…It’s a sign of the times.”
The vineyard has to be replanted, he said; the aging vines were pulled a few years ago at a cost of $316,000.
Alpha Omega tried to sell the property for more than six months without success; however, Baggett and Larry Stricker said in separate interviews that they would collaborate to try to once again sell the property.
Baggett said selling the vineyard is the best option; under the arrangement, the F&M Bank debt would be paid off, and the Strickers would collect the rest of the sale price.
The Strickers would have been responsible to pay $4.2 million to F&M Bank had Alpha Omega just turned the deed of the Mount Veeder property over to them, Baggett said.
So far, the Strickers have received $7.3 million from Alpha Omega for the property over the years, including the $6 million cash payment and consulting fees, according to Alpha Omega.
Baggett said the bottom line is that Alpha Omega is trying to do the “right thing here even though we had nothing to do with the downturn of vineyard valuations and the wine economy.”
Alpha Omega, which produces 20,000 cases of wine a year, buys most of its fruit. “We’re doing fine,” Baggett said, of Alpha Omega.
Larry Stricker, who purchased the Mount Veeder Road property in 1986, is out of the wine business. He sold his last cases of wine in 2020. “I’m glad I’m not in the wine business any longer,” he said.
