The setting for Sylvie's wine auctions is remarkable to say the least: an old sailor's church, a stone's throw from the Antwerp MAS. The same block of buildings once housed a brothel for the same sailors. Now about six times a year thousands of bottles of top wine go under the hammer. A floor below is the wet dream of every wine lover: a cellar with an impressive stock of around 13,000 bottles. From a Nuits Saint Georges from 2011 to a Château Pétrus from 1971 to more and more Italian toppers and a number of bottles of vintage port Quinta de Roriz.
The auction itself, on the other hand, is very much 2022: there are fewer and fewer physical bidders, but the auctioneer - neatly flanked by a bailiff - chases through one lot after the other at a breakneck pace. Under the all-seeing eye of the camera, because there is bidding from all over the world. About half of the Antwerp auction house's customer base comes from Asia, 30 percent comes from Europe, the rest offers from the US and a handful of other countries.
The auction house saw the light of day forty years ago, but only settled in Antwerp in 2010. “We receive so much wine these days that we have to spread our auctions over three days,” says Timmy Reynders. He is one of the two cellar masters that Sylvie's permanently employs. “Such an auction is good for about 3,500 lots, consisting of one to twelve bottles. We are one of the largest providers worldwide, especially when it comes to wine auctions that can be followed both physically and online. With us, people can really compete against each other, online or otherwise. After each auction, we therefore largely physically empty our showroom and cellar in the run-up to the next auction.”
High-end market
The supply has been increasing for years. Older wine enthusiasts wanted to empty their wine cellar completely or not, so they approached an auction house such as Sylvie's. But times have changed: wines are not only produced to be drunk younger, and the houses with a real storage cellar are becoming increasingly scarce. Sylvie's is now more often visited by people who see wine at least partly as an investment object. “Often these are enthusiasts who have bought a grand cru to enjoy it for themselves. Until they realize that their case of twelve bottles has increased fivefold in value. Then they think it's a shame to just drink that fortune themselves and miss out on that huge return on investment,” explains Reynders.
“It sounds simpler than it is,” continues Reynders. “Of the millions of bottles of wine that are thrown onto the market every year, barely one percent is also eligible for auction afterwards. This is mainly driven by demand from the international market. When we are contacted by such a wine lover, we go on site and that international demand is our very first criterion. In addition, of course, the intrinsic quality of the wine and the condition of the bottles also play a major role. Because we mainly aim at the highest market segment, we only accept bottles from a sales value of 25 euros, excluding commission. But the average bottle price of the range we now have here is a lot higher at 154 euros.”
Small-scale production
If a bottle or lot gets the green light, they are transferred to Sylvie's cellar where they are checked and described for inclusion in the catalogue. From the filling level of the bottles over the condition of the cork to the appearance of the bottle. Even a slightly stained label can significantly reduce the potential retail price. The minimum price is set by the auction house, although the seller is of course free to refuse that offer.
Reynders: “Potential buyers can usually go through the auction catalog two weeks in advance and then start bidding. This can be done with an app, but of course also during the auction itself.” It is difficult to determine what those buyers do with their wine afterwards, but Reynders does see some remarkable trends. “Certainly in Asia, wine enthusiasts see no problem at all in almost immediately uncorking a top bottle that they bought for roughly 10,000 euros. A top wine like this is much more of a status symbol towards friends or business associates.”
“In Europe, buyers are much more aware of the investment value, and such bottles disappear much more often in the cellar,” says Reynders. “Anyone who follows the wine world and the auctions a bit, quickly learns which wines have sufficient investment potential. Take a region such as Burgundy, but actually also Champagne: the total production there is so small that it is almost a feat to really buy bottles from the most reputable domains. Those who manage to do so often consider such bottles as an interesting investment.”
"A good storage wine offers absolutely no guarantee in terms of financial return. conversely, it is of course completely pointless to invest in bottles that have no storage potential." Aart Schutten, owner of Sylvie's
Market development
Aart Schutten, an ex-banker who has been at the helm of Sylvie's together with his wife since 2017, has seen an increasing interest in wine as an investment for several years now. “The low interest rates have made people with some savings think. Not only wine benefits from this, art, old-timers or crypto coins also benefit from this. We are aiming for the top segment, and we see that, especially in Europe and the US, more and more people are buying to invest. In the Asian market, on the other hand, the share of consumption is even larger.”
The key question is, of course, whether a certain bottle will still be 'drinkable' in ten or twenty years' time. And how can I be sure that that one grand cru is really worth its list price and will retain it in the longer term? “We cannot check the contents of a bottle, that is really a buyer's risk,” admits cellar master Reynders. “On the other hand: anyone who buys wine to invest will in principle never open the bottle. I firmly believe that some top bottles are bought and resold several times, but are never opened. Buyers initially rely on the production year and the theoretical value. This is more guaranteed by the reputation of the winemaker, but just as much by his high-quality production process, which he uses top corks, for example.”
“What an owner thinks of a particular wine is not really interesting,” adds Schutten. “Tastes just differ. Whoever considers purchasing wine as an investment, first and foremost wants a guarantee that the wine is technically correct: this includes the condition of the cork, the filling and the label. Two bottles may have their vintage and domain in common, and even come from the same box, yet be priced very differently by the look of the label. Those who invest in wine often rely less on taste than on the scores that a specific bottle has received from internationally renowned wine critics. In addition, fashion also determines the price, just like in art: Bordeaux is still popular, but the entry prices for the real toppers there are already so high that it is much longer to wait for a solid return.”
Schutten: “Burgundies, on the other hand, are doing very well today. Partly because those wines are much scarcer, that's right, but also because the flavors have changed. Moreover, the production methods in the region have also improved enormously, so that they now have more storage potential. Anyone who bought a crate thirty years ago from a producer who now has a good reputation in the Burgundy region can look forward to a fabulous return. Some bottles of La Tâche from Romanée-Conti for which you paid 300 euros at the time, now go for 5000 euros. As an auction house, we are also somewhat the thermometer of the market: we are the first to see new trends emerge.”
Insight
There are also certainties for wine as an investment. French wine remains undisputedly the most coveted. In the international market, Bordeaux has an impressive 36 percent market share, Burgundy accounts for 27 percent and Champagne also scores particularly well with 14 percent. Some Italian classics are doing better and better, and Spain also seems to be on the rise.
“If you want to invest in wine, it is best to keep a few golden rules in mind,” emphasizes Aart Schutten. “A good wine for storage offers absolutely no guarantee whatsoever in terms of financial return. After all, there is a lot of good wine on the market, so only the absolute top has a solid investment value. Conversely, it is of course completely pointless to invest in bottles that have no storage potential."
Schutten emphasizes that investors must follow the market closely. “You have to read up, possibly get to know the producers better and visit them. But you also need to keep an eye out for broader signals and trends. In that sense, wine is no different from other non-financial investment instruments, such as cars or art, for which you also need to have a good nose. As a former banker, I think the risk with wine is much lower than with equities. Those markets can suddenly collapse completely, which hardly ever happens with well-known wine estates. And as far as the potential is concerned: the real top wines will score considerably higher in ten years' time than today. But then, of course, it mainly comes down to being able to put your finger on those top wines now. And that insight is not for everyone.”