The Lebanese wine industry continues on its growth trajectory, and it seems that every year we hear of new wine labels entering the market. Executive profiles a selection of the newest wine labels to make their mark on Lebanese palettes, outlining their story and their business strategy.
Rather than being the products of proprietary wineries, the four wine labels profiled in this article currently rent sections of established wineries instead. The owner of each tells Executive the reason for renting, which is becoming more common in Lebanese viniculture.
Muse is the brainchild of Nadim Khoury, an agricultural engineer who owns Khoury Agriland, a business that cultivates and sells table grapes in the Bekaa Valley. Khoury’s passion for wine pushed him to apply his agricultural background to growing grapes for wine production. Khoury chose the name Muse for his label because his mother is named Calliope, after one of the muses in Greek mythology, and because he sees wine as an inspirational product.
Khoury believes that as an agriculturalist, his role is to provide the winemaker with the best quality grapes, thus enabling him or her to make good wine. Since he wanted to position Muse as a high-end wine, he spared no expense and hired the renowned Michel Rolland as a consultant and winemaker, ultimately choosing Ainata, Bsharri, as the vineyard’s location. “When you work with a consultant, he typically has in mind what kind of wine he wants to produce, and this will dictate the kind of grapes you need, and therefore which area they would best grow in,” Khoury says. “Through our experience with Roland, we finally decided to plant our vineyards in Ainata, close to the Cedars of God, at an elevation of 1,800 meters.”
Through a BOT (build-operate-transfer) contract, Khoury rented a 600,000 meter squared piece of land in Ainata for 25 years, and began planting it with grapes in 2016. To date, Khoury has planted 200,000 mother plants and plans to rent additional land in Ainata to reach 1 million square meters. “In 2019, we will plant another 50,000 mother plants, and in 2020, another 50,000, and then we will reach the 1 million square meter of planted wine grapes,” he says, explaining that they began their production by using the land’s already established grapes, which were over 20 years old, but was soon limited by the amount of existing grapes, which is what led to their expansion. Khoury says they are currently producing 30,000 bottles, but his eventual target is to produce 200,000 bottles once his vineyards have expanded and matured.
Muse’s vineyards are the highest by elevation planted in Lebanon, and the highest in the Mediterranean in terms of the grape varieties being used—but this does not come without challenges. “When you are planting at that elevation, there are many risks involved,” Khoury says. “The [cold] weather is one of them, and the mother plant will not bear enough grapes to make [a high] enough quantity; the same mother plant in the Bekaa Valley will bear three times the kilos of grapes at a high elevation. But the advantage is that the grapes benefit from pristine environment, and this was the vision of Rolland—it comes with the personality of the wine he is making. The outcome was good because the taste of the wine is good.”
Planting in such an elevated and remote area is also expensive. “Everything is costly with Muse, starting with the wine consultant; the elevation, which creates a low yield; the mother grapes, which were all imported from France; and transportation from Ainata to the winery,” says Khoury. To date, he has invested $1.5 million in Muse. The initial funds were mainly for the rent, the preparation of the land and planting, and the cost of the mother trees. But to Khoury, Muse signifies quality, and as such, no expense can be spared. “There is a target out of any commercial project you make: My target is to hopefully break even in 10 years if I can. I will be very happy then, because this is my passion,” he says.
Khoury believes Muse’s positioning as a high-end wine is signalled through the etched labeling, the bottle design, and the quality of the wine itself. As such, the price is medium to high range, starting from $12 for a bottle of white wine and reaching up to $20 for the red.
To Khoury, the essence of a wine is its vineyard not its winery, which he says is essentially dormant save for a month or two of the year. To get Muse started, he rented space in an established winery in Lebanon and brought in his own equipment. “There are many wineries in Lebanon who may have difficulties or extra premises they don’t need, so for us to cut on time, we rented a part of a winery ,and we are producing according to our personality under the instructions of Rolland, using their premises. We bottle everything there and take it to our warehouses,” Khoury says.
Still, Khoury plans to construct a small vineyard in Ainata starting in 2020, complete with a small guesthouse and boutique restaurant. “The restaurant and guesthouse are mainly for the brand image. If you welcome people into your winery, and they make this trip all the way to Ainata, they need a place to eat, and a place to stay,” Khoury says. “The profits will go to cover the expenses of the location for the two summer months, during which it will welcome visitors.”
While Khoury is not against winery premises being used as a wedding venue, he says the Ainata location is not suited to this. Instead, he is planning to develop a relais (guesthouse) by 2023, somewhere in Mount Lebanon. This facility will take over part of the wine production, most likely the aging or bottling phase, and will also serve as an events venue and restaurant location.
Distribution of Muse is handled in-house. To date, the label can be found at 18 points of sale, including both on trade and off trade businesses. Khoury believes this restricted POS presence is reflective of Muse’s exclusivity and scarcity, making it a sought after product.
Vin Du Marje
Carole Tayyar Khoury had always enjoyed a glass of wine, but she never imagined that she would one day be in the winemaking business. Her story with wine begins in 2010, when she and her family returned to Lebanon after having lived in Dubai, for 20 years. During her absence, the south of Lebanon had been liberated from Israeli occupation and Khoury could finally consider investing in a five dunams (5,000 meter squared) plot of land she owned in Jdeidet Marjeyoun, a town on the southern border of Lebanon, where both she and her husband hail from. She wanted a project that would both contribute to the revitalization of the economy in her beloved hometown, by generating jobs and attracting local tourism, and be a viable business that her children could be involved in that would tie them to Lebanon and the land.
She studied the businesses in the area and realized that there were no wineries in the region, which opened her eyes to the possibility of developing one in Marjeyoun. The first thing she did was hire experts to test the viability of her land as a vineyard, in terms of soil quality and climate. She was told that her plot was suitable.
Having no background in agriculture or viticulture, Khoury knew she needed to recruit external support to realize her winemaking project. The days passed, and although the idea of starting her own winery never left her mind, Khoury did not take steps in that direction, having planted the land with olive, pine, and pomegranate trees instead. At the time, she recalls, she found this an easier and safer investment, given that olives are a very popular crop in the area, and many knew how to tend to them. Since olive trees are often planted alongside vineyards, she was reassured that this move would have no negative implications for her long-term goal, when she chose to achieve it.
Then, in 2016, Khoury was introduced to Vigna Verde—the owning company of Château Barka and also a wine consultancy—through work contacts of hers, learning that the family business helps interested investors cultivate their vines, equip their wineries, and produce wines of all varieties. This encounter empowered her to embark on her winemaking project. She decided to call her wine label Vin Du Marje, in homage to Marjeyoun.
Khoury began working with Vigna Verde in 2016, asking their winemaker, Hisham Geagea (a co-owner of the company, along with his brothers), to visit her land in Marjeyoun to determine which grape varieties should be planted. Syrah, Cabernet Sauvignon, Viognier, and Chardonnay were selected.
Since Khoury’s vineyards will take three years to mature, she has rented an established vineyard in the south in the meantime. In addition to these grapes, she has entered into a damanet, a contractual agreement under which she guarnatees she will purchase all the grapes produced from that plot of land for a set period of time. Under the conditions of the damanet, she will be cultivating grapes from Vigna Verde’s vineyards in Barqa, Baalbek in order to produce the first varieties of Vin Du Marje. Khoury believes this move will help her start promoting the label, while she waits for her grapes to mature. The exact same grape varieties and blends will be used when she is finally able to make wine from her own vineyards.
In the second phase of Vin Du Marje, Khoury plans to increase her land dimensions in Marjeyoun and thus raise production. She is currently producing 5,000 bottles and has a target of 20,000 bottles.
To cut down on costs, she is currently using Château Barka’s facilities (as part of her contract with Vigna Verde), but she plans to launch a small winery complete with a bistro restaurant on her land in Marjeyoun as the final phase of Vin Du Marje, in three to five years’ time.
Khoury plans to manage her own distribution, counting on the support of Marjeyounis both locally and abroad. “All Marjeyounis I know are excited about this project: People who live in Canada, USA, Brazil, and many other countries are asking me when the wine will be out. I am counting on their passion for Marjeyoun and the land to make the wine successful, especially because there is nothing similar to it in the area,” says Khoury.
Vin Du Marje will enter the local market first in December 2018. Khoury projects that 50 percent of the production will be exported at a later stage. Vin Du Marje be available in restaurants and supermarkets in Marjeyoun, as as well as in delicatessens and select restaurants in Beirut.
Reserve Ammiq wine was created from the Skaff family’s love of the land in Ammiq, West Bekaa, and its significance as a winemaking area. “Reserve Ammiq’s logo is the elm tree, which represents the region of Ammiq, not only the wine,” says Aida Skaff, marketing director of Reserve Ammiq. “Also, we insisted on having the name of the terroir as part of the brand name because it’s not only the vineyard that we want to highlight, but the area itself.” Skaff says that their goal is to revive Ammiq and highlight its role in Lebanon’s winemaking industry (read more on that in Executive’s December issue).
Aida and Peter Skaff, the current winemaker at Reserve Ammiq, are the third generation of the Skaff family business, which deals with agriculture, through both olive tree cultivation, and viticulture, through the growing and selling of wine grapes to nearby wineries. The family business dedicates 90 hectares of land in Ammiq to wine grapes.
For almost 60 years, the Skaff family had an exclusive contract with Château Musar for their grapes. When that contract ended in 2008, it was not renewed, as Château Musar had by that time become self-sufficient and planted its own vineyards. This is when Naji Skaff, the father of Peter and Aida, seized the opportunity to indulge his passion for winemaking by using 1 to 2 percent of the family’s 90 hectares of vines to develop his own wine label as a hobby, for limited distribution among friends and family, the rest of the grapes were sold to wineries in the region.
Peter Skaff, who was still a university student at that time, in 2008, accompanied his father to Ammiq on a wine-related visit and quickly fell in love with the beauty of the nature there, having rarely visited while growing up. “I was amazed by what I saw that day, and felt that I belonged here in Ammiq more than I do in Beirut, as I’m more of a nature person,” Peter tells Executive. “I decided to travel to France, which is the basis of all winemaking, to study oenology and viticulture.” After completing his studies, he travelled to New Zealand and the USA for internships and wine consultancy work. During that time, Naji Skaff continued to produce small quantities of wine as a hobby. When Peter was in Lebanon, he would share his newly acquired knowledge with his father on an informal basis.
In mid 2016, Peter returned to Lebanon to gradually take over the production of Reserve Ammiq. Aida also returned from London, where she had been working in luxury marketing, to aid her brother in the marketing of Reserve Ammiq. Together, the siblings intend to make a productive commercial enterprise out of the label.
Peter recounts that his father had been producing roughly 5,000 bottles in a rented portion of an already established winery in Mount Lebanon. “It was not a business for him and he was not making money out of it,” he says. “Since it was a hobby, he didn’t want to invest in a winery before he tested the product and the market.”
Peter and Aida, however, are planning to establish a boutique winery on their land in Ammiq within the next three years. Right now, explains Peter, they are in the transition phase of turning a hobby into a business, so they want to wait a little to solidify the brand and make some profit before they build the winery, which they both see as important. “The good thing about having a winery is that people can see where the wine is coming from, which makes them want to try it more,” Peter says. “I get calls asking if we have a winery in Ammiq or not, so there is demand for that.”
Describing what the winery would look like, Aida says, “It will reflect our image and will be cozy with nice architecture, which will be done by our architect brother. It will be small and will have a view of the vineyard. It will of course be open to the public to provide people with the wine experience and will have a small restaurant on its roof.” She explains that when people visit the winery, they will be able to enjoy activities on the land as well, such as biking and hiking, so they could easily spend the day there.
The 2017 vintage of Reserve Ammiq is the first “purely Peter” production, says the young winemaker. They are currently producing 7,000 bottles and aim to produce not more than 60,000 at peak production, in order to remain a boutique winery—although Peter says they have the capacity to produce a million bottles, if they so choose. For now, they have kept their fathers’ labels on all bottles, and also his price range—ranging from $7 for the cuvee to $20 for the chateau. However, as his father’s vintages are phased out, Peter says he is planning to increase the price “in a realistic manner” for his vintages, to suit Reserve Ammiq’s new positioning as medium to high-end wine.
So far, the Skaffs’ investment in Reserve Ammiq is minimal, Peter says. “The advantage we have in this business is that we own our vineyards—we already have the grapes, which is the heaviest investment for any winery. The main investment right now is in renting the winery. We also invested in the bottles and materials, and later on we will invest in building the winery in Ammiq.” The money for all of this comes from family funds, he notes.
Aida explains that she will be responsible for distribution and, in terms of the local market, is targeting high end delicatessens and exclusive supermarkets where there is a focus on the wine selection. Reserve Ammiq is also available on 209 Lebanese Wine’s platform. For now, Reserve Ammiq is only available locally, but Peter plans to export as soon as they hit 50,000 bottles. “I will export 60 percent of my production, which is the standard if you want your business to work, since in Lebanon the market is very small, and there is a lot of competition,” he explains.
Joe Saade hails from a communications and marketing background and was the cofounder of advertising agency Grey Middle East (GME). He had always enjoyed wine but developed a deeper appreciation for it in the 1990s, when GME was operating out of London. The company was handling the communications of the state of Kuwait during and following its invasion in 1990, and there was a wine bar beneath its office building. “We were there every day drinking wine, and this is when I started buying books about wine, reading more, becoming more critical about the wines I drink and trying to understand more,” recalls Saade.
In 2002, Saade sold his shares of GME, which was then operating out of Dubai, and continued working in the UAE independently for a while. In Dubai, Saade was neighbors with George Naim, now the owner and founder of Château Qanafar, with whom he would go on daily walks. It was during one of those walks, in 2007, that Naim told Saade about a couple of vineyards he had in Qanafar, which he was using to produce small amounts of wine as hobby. Both being fond of wine, the two men would discuss this project at length, and whenever Saade was in Lebanon, he would taste Naim’s wines.
Not too long afterwards, the two men discussed the possibility of starting a winery project together in Lebanon. Ultimately, however, they decided to work closely together but produce two separate labels, using separate vineyards in Qanafar, so as to be able to leave the business to their families in a smooth manner. Naim, who already had his vineyards, started immediately producing Château Qanafar. Saade, however, still had to buy and plant the land.
In 2008, Saade brought his first piece of virgin land in Qanafar and planted it; he continued to choose only virgin lands for his vineyards (with one exception). “If you want to have a high-quality product, you have to control the main ingredient, which are the grapes in this case,” Saade says, to explain this choice.
Saade decided to call his wine Terre Joie, or TJ, for several reasons, the first being that the name would be a tribute to his son, Tarek Joe (whom they always called TJ), who passed away in a diving accident before his father’s project was realized. Saade feels that Lebanon is a land of joy (the english translation of terre joie) so the name works that way as well, and, finally, the arak Saade produces (but has not yet sold, prefering to age it further) is called Ard el-Saade—which is Arabic for terre joie and includes the family name.
Saade had to wait three years for his grapes to mature before he could start production, so he produced his first noncommercial red wine in 2011. In the beginning, both Naim and Saade were producing their wines from a garage in a building that Naim owned in Qanafar. Shortly afterwards, Naim decided to build a 3,000 meter squared winery, stretching over three floors and with a wide terrace. Naim convinced Saade to rent a section of that winery instead of building his own, and Saade agreed. Rather than investing in his own winery, Saade built a Terre Joie tasting room and gathering space on his land in Qanafar instead.
After producing his first vintage, Saadeh decided he wanted formal training in wine, so that he would not have to rely completely on the advice of others in his production. While completing a residential course on wine at the University of California-Davis, he met members of the International Organization of Vine and Wine, who told him about their masters program in wine management. He signed up to start the next semester. “I wanted to do [wine] on the basis of knowledge and not just hearsay,” Saade says. He works with a French winemaker, David Siry, who visits Terre Joie five times a year and accommodates Saade’s style in winemaking, which is a more elegant and less classical wine than the typical Lebanese style.
Experimental vintages were also produced in 2011 and 2012, in small quantities, Saade says, making the 2013 red his first commercial quantity wine. The 2013 vintage entered the market in late 2017, after aging in bottles for four and a half years, to a positive response. The 2014 red vintage was introduced at this year’s Vinifest, in October, and the 2015, 2016, and 2017 vintages of red are still being aged.
Saade also recently began producing a Cinsault wine, the 2016 vintage of which was released at this year’s Vinifest as well. “The Cinsault is the oldest imported grape of Lebanon and is the one the Jesuits filled the country with in the 19th century, before most of it got uprooted and replaced with other grape varieties,” Saade says. Having found a 30-year-old Cinsault vineyard at an altitude of 1,400 meters, he says, he rented it for 18 years—the only vineyard he rented instead of cultivating himself.
Saade also produces a rosé that is made of 100 percent Grenache grapes, and has planted grapes at an altitude of 1,400 meters in order to produce white wine in the hopes of launching it in 2021. Saade believes that, taking into consideration Lebanon’s hot climate, it is best to plant wine grapes at an altitude of at least 1,000 meters. With the exception of the first plot of land he bought, all of his vineyards are above this threshold.
Saade’s vineyards today stretch over 100,000 meters squared—75,000 of which are cultivated—and he currently produces 15,000 bottles. By 2021, he aims to increase that number to 25,000. “There is the possibility of renting land where I can control the planting, if I want to expand [further],” Saade says. “I have a land in Keserwan which I can also use, so I have no problem expanding.”
Benefiting from his extensive experience in marketing, Saade is handling his own distribution and his wine is currently available in seven local boutique restaurants and shops, on 209 Lebanese Wine’s online platform, and—unusual for a new winery—in Beirut’s international airport’s Duty Free area. “It took hard work and big sacrifices because they take big margins. But the exposure I get being in such a prestigious location is cheaper than if I am to buy advertising space,” explains Saade.
He is also in negotiations with Spinneys and Carrefour, and says that once he is available in these two supermarket chains, he will not stress over other off-trade points of sale in Lebanon, since these are the two main locations his potential customers shop in.
Saade has so far invested $1.8 million in Terre Joie, between the purchasing of the land, the renting of the winery and the buying of the equipment—all of which came from his personal funds. Saade says he will continue to invest for another year, but expects his investment to reach $2 million before the venture starts generating revenue or at least covering its own cost, although he says he isn’t worried about the return. “I don’t care about the return simply because the land I bought has gained value, and if I sell it today I can double or triple what I put into it,” he says. “I’m not doing it for the cash right now but for the long term, because my real estate investment will cover more than my cost. And at the same time, I want to make the best wine possible, sell it in the best way possible, because I want to build brand equity, because whoever will take the business after me will benefit from a well-established brand.”