Hong Kong investors see wine as good bet for capital growth

The price for a bottle of 2005 Domain de la Romanee Conti, for example, jumped from about US$2,000 in 2005 to US$8,200 early this year, according to market data.

Hong Kong's wine market has become a major beneficiary of that trend, thanks in part to a government move to scrap a 40 percent tax on the tipple last year and its geographic proximity to mainland China.

Auction house giants Sotheby's and Christie's both said this month that the southern Chinese city has overtaken New York and London as the world's largest market for rare vintages.

Sotheby's raised US$14.3 million from just two auctions in Hong Kong this year, almost double the figure of London, which has had a total of eight wine sales so far in 2009.

At Sotheby's latest wine sale in October, mainland Chinese buyers accounted for as much as 35 percent of the total number of buyers, compared to 10 percent in its April sale here -- the first one held by the auction house in the region.

A Sotheby's spokeswoman said the October sale fetched 30 percent more than its estimate, with an anonymous Chinese bidder splashing out a record US$93,077 for a bottle of 1982 Chateau Petrus Imperial.

Rival Christie's said its Hong Kong wine auctions had the highest average lot values among its global sales, at US$150,000 per lot.

For some, there is another dimension to the investment potential of wine.

Investment planner Samuel Young, who bought more than 10 boxes of rare vintages from the Sotheby's October auction, said he would sell the wine to his key clients.

“My business clients, including those from the mainland, would sometimes ask if they can buy a few bottles off me,” he said.

“I will sell the wine to those I want to build a good relationship with and I won't try to make any money out of it,” he said.

“It's like doing a favor to them. To me, it's another kind of investment.”

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