Going Up in a Down Market

LAKEPORT, CALIF. —  When you think of California wine dynasties, the name Kendall-Jackson doesn’t immediately come to mind. But very soon this Lake County producer will join Gallo, Mondavi, Beringer and Glen Ellen as a wine powerhouse.

By “wine dynasties” I mean companies that own a number of wineries, each with its own winemaker, and that make millions of cases of wine a year. Kendall-Jackson doesn’t yet have the volume of cases, but it will. It’s the fastest-moving wine operation in California; last year its sales were about $45 million, actually rising in a down market.

Jon Fredrickson, president of the San Francisco wine consulting firm Gomberg, Fredrickson & Associates, selected Kendall-Jackson as his choice for the super-premium winery of 1990. Fredrickson says Kendall-Jackson sold 626,000 cases of wine last year, up from 405,000 in 1989--a gain of 54% at a time when wine sales and consumption were in a slump.

“They are obviously one of the hottest wineries around,” says Fredrickson. “There is nobody even near their performance, and they are selling (their wines) at high prices. It’s truly unprecedented. No entity has ever come along this fast in this price range.”

But you haven’t seen anything yet. Within the next year, Kendall-Jackson will release a number of new and exceptional wines under new brand names. Company officials decline to give numbers, but even though the winery is not yet at 1 million cases of production, one wine industry analyst said officials are already talking about 2 million cases within the next three years.

The brainchild of Jess Jackson, a San Francisco trial lawyer, Kendall-Jackson started life as Chateau du Lac Winery with modest wines from the 1982 vintage. Things changed radically when Jackson hired Jed Steele to be winemaker in 1984.

Steele, formerly at Edmeades in Mendocino County, is a brilliant stylist who has done dramatic things with every grape he’s touched. To illustrate: At the 1988 Farmer’s Fair of Riverside, where the sweepstakes award went to 1985 Kendall-Jackson Cabernet, the runner-up was 1987 Kendall-Jackson Muscat Canelli and third place went to ’87 Kendall-Jackson Sauvignon Blanc.

Kendall-Jackson has become a force in the market principally with its Chardonnay. Steele’s version of the wine was packed with flavor. The real secret, though, was sugar--no one has ever gone broke underestimating the public’s sweet tooth, even with Chardonnay, and Steele exploited that weakness brilliantly.

He started with excellent fruit and handled it carefully, fermenting some in barrel and aging all of it in French oak casks. The wine had a noticeable trace of residual sugar--less than 1%, but enough to make the wine soft and approachable for people who really didn’t like dry wine.

The story of Kendall-Jackson is more than just one wine brand, however. Jackson has assembled a winemaking team and a series of properties that rival Beringer and Mondavi for diversity and quality. Among the holdings:

The Lakeport facility, which is already at production capacity (500,000 cases). It is headed by John Hawley, a worthy successor to Steele, who left to make wine under his own label.

Cambria, a 500,000-case production facility in Santa Barbara County headed by Signe Zoller. Initial releases of Chardonnay and Pinot Noir have been styled rather like Steele’s and are winning high praise. Jackson owns or leases some 1,500 acres of vineyard land nearby. Most of the production here goes to Kendall-Jackson.

J. Stonestreet, the former Stephen Zellerbach Winery that Jackson named for his father. At its head is Steve Test, former winemaker at Laurier and one of the best in the business. The first Stonestreet wines will be out next spring. The winery has 100 acres of its own vineyard land and also buys grapes from all over Sonoma County.

An as-yet-unnamed winery in the Anderson Valley of Mendocino County that will make premium sparkling wine. The project is headed by Harold Osborne, one of the best makers of sparkling wine in the country. The property, formerly home of Edmeades, has 80 acres of vines.

An as-yet-unbuilt and unnamed winery in Monterey County where winemaker Randy Weaver will make wine from more than 2,000 acres of vineyards either owned or leased by Jackson. A winery will be built there within the next two years. Until then, Weaver will make wine at leased facilities for the K-J brand.

In addition to all that, Jackson has plans to build a major winemaking facility in Santa Rosa in the heart of Sonoma County.

Jackson beefed up his staff by hiring the talented Hawley away from Clos du Bois just days before the 1989 harvest. The move infuriated officials from Clos du Bois, who accused Jackson of playing dirty pool.

But Jackson, who owns or leases some 5,000 acres of vineyard land in California, is considered by some analysts as a smart businessman who has a knack of finding the right people for the right jobs.

An example is Tom Selfridge, vice president of production. For 18 years a winemaker at Beaulieu Vineyard in the Napa Valley, Selfridge is a key to K-J, say industry leaders, because he knows wine.

“This guy is no corporate bean counter,” said one source. “He speaks wine.”

“John (Hawley) and I can talk to each other and we understand each other,” said Selfridge. “We use the same language. When he talks about barrels, I know what he means.” Selfridge also has a finance background, so he can speak with the effective K-J sales force from a base of knowledge.

“Tom has never compromised on fruit or on barrels,” said Hawley. “Quality is everything to him, and that’s what makes Kendall-Jackson what it is.”

Hawley has already made an impact on the Kendall-Jackson wines. The 1989 Vintners Reserve Chardonnay ($13 but usually discounted below $10) is slightly less sweet than past efforts, a beautifully balanced wine.

This year, Kendall-Jackson will crush grapes to make well over 400,000 cases of Chardonnay, and although company officials decline to give any figures on total production, Kendall-Jackson could well make more than 800,000 cases of wine this year.

Included are some superb wines from other varieties. Current releases include:

The 1990 Lakewood ($15), a proprietary name for a wonderful Semillon. The wine has spicy fig, pear and melon aromas and a marvelous creamy texture.

The 1989 Chardonnay Proprietor’s Grand Reserve ($22.50). Pricey, but a buttery, rich, unctuous wine that tastes almost sweet. The creamy texture and honeyed taste make it good with richer foods, including Chinese food.

The 1988 Vintner’s Merlot ($14). Aromas of tea, olives and cherries, with a lean, crisp finish; better in another year or two.

The 1988 Syrah, Durrell Vineyard ($22). One of the best Syrahs in the state, with classic Rhone-type notes of tar, chocolate, violets and cloves. A wine for Rhone connoisseurs.

The 1987 Cabernet Sauvignon, Proprietor’s Grand Reserve ($22.50). Marvelous wine with fresh cherry, anise and a light toastiness from oak aging. The wine’s structure is rich enough to age, but luscious enough to drink now.

The 1987 Cardinale ($45). A classic blended Cabernet with intense black cherry, minty and spice notes, a toastiness from the oak, and big, rich finish. The 1986 Cardinale was priced at $65, but winery officials admit that was simply too high. The ’87 may be a better wine and cheaper, though still pretty expensive.

K-J also makes exceptional Zinfandels, a delightful Gamay, good Pinot Noir and superb dessert wines.

Facility Planned for J. Stonestreet

Although the growing Kendall-Jackson empire has the J. Stonestreet winery in Sonoma County, plans have already been drawn for a major new winemaking facility to be built on an 84-acre site northwest of the city of Santa Rosa.

The Stonestreet winery has a capacity of about 120,000 cases. The new Sonoma facility, if it gets approval from local agencies, would be three times that capacity in two large buildings surrounded by 40 acres of vineyards. It would be Kendall-Jackson’s main facility for crushing the 6,000 tons of Sonoma County grapes it uses.

Mild opposition has popped up from neighbors of the proposed winery, but winery officials say they expect approval soon.

The winery also said it will open a tasting room on the Healdsburg square on Aug. 8, where all its wines will be poured for visitors.

Wine of the Week

1989 Seghesio Strata Red ($5.50)-- In the days before varietal wines became important in California, some of the best wines were blends of Old-World varieties. Some of these varieties are not well respected today. But blends such as this one can be delightful. Here, a combination of Petite Sirah, Pinot St. George and Napa Gamay give an aroma that is spicy and rich. The body is full, but quite dry, with complexity from aging in French and American oak barrels.

A companion wine, 1990 Strata White, also $5.50, is a blend of Pinot Blanc, Muscat and Chenin Blanc. Half was barrel-fermented, and the wine has a lovely spicy aroma balance and richness on the palate. The wines should be found at less than $5 in most shops--superb values.