Joel Goldberg

For over 40 years, Ann Arbor wine retailer Village Corner was a fixture on South University, near the University of Michigan’s Central Campus, until it closed last November to make way for a student high-rise at 601 S. Forest.

Dick Scheer, an iconic figure in Michigan wine circles, owned the store that entire time. When it closed, Scheer stashed his inventory in temporary quarters, took his Terminator turn – “I’ll be back!” – and pledged to reopen shortly in a venue with better parking, as he told Sandra Silfven of the Detroit News.

Then, nothing. Scheer went to ground, keeping his own counsel as he sought a new location, to the not-infrequent exasperation of long-time customers and members of the media alike.

Until last week, when the website of Michigan’s Liquor Control Commission (LCC) spilled the beans: on March 17, Village Corner applied to relocate its beverage licenses to another campus-adjacent address.

North Campus, that is.

The new location, at 1747 Plymouth Road in The Courtyard Shops, sits between No Thai! restaurant and Jet’s Pizza, in a storefront formerly occupied by Tanfastic tanning salon.

At 1200 square feet, the store would give Village Corner significantly more display space for wine than the constantly-cramped South University location. And, yes, there’s parking just outside the front door.

Village Corner, formerly located on South University, has leased space in The Courtyard Shops between No Thai! and Jet's Pizza.

But Scheer still won’t discuss specifics, except to confirm that he has leased the space. He says that discussion of an opening date, hours and staffing would be “presumptuous” and “premature” at this point, because everything depends on LCC approval of the license transfers to the new location.

“We don’t want to be another Costco or Walmart,” he said, a reference to the lengthy and highly-publicized travails of both national retailers to obtain the necessary government approvals for local stores.

His reticence is understandable, because LCC approval may not be a gimme. In addition to its easily-mobile beer and wine license, Scheer also wants to transfer Village Corner’s license to sell higher-alcohol distilled liquor.

That’s where the kerfuffle may arise. Michigan beverage regulations prohibit multiple liquor licensees within a half-mile radius – and Northside Liquor sits just across Plymouth Road from the Courtyard Shops.

Scheer says the Courtyard Shops location qualifies for an exemption, because Plymouth Road is a four-lane road. But while the state’s regs do allow the LCC to waive distance regulations for a businesses on “a major thoroughfare of not less than 4 lanes of traffic,” nothing obligates the commission to grant an exception in any individual case.

Northside Liquor might also formally oppose the transfer, which could throw a monkey wrench into the approval process. Reached on Thursday, Northside owner Janan Zaitouna said he hadn’t received official notification of Village Corner’s application from the LCC. But he indicated that he wouldn’t be favorably disposed to see another liquor store hang out its shingle right across the street.

For his part, Scheer indicated that he would likely exercise a provision to opt out of the lease unless Village Corner can transfer its license to sell liquor, along with wine and beer.

Barring unexpected delays, the normal LCC license transfer process can take as long as two months, allowing time for paper shuffling, an on-site inspection, and sign-off by the local police department. If approved, Scheer says he would need at least four to six weeks to fixture and stock the new space before Village Corner could reopen.

But all he’s done to date is install an LCC-required burglar alarm in the still-empty space. Until the license details fall into place, he says he’s not planning further down the road.

About the author: Joel Goldberg, an Ann Arbor area resident, edits the MichWine website and tweets @MichWine. His Arbor Vinous column for The Chronicle is published on the first Saturday of the month.

Village Corner Wine Catalog, circa 1977 (image links to higher resolution file)

Two charter members of the Vinous Posse dropped by the other day, carrying a treasure from their cellar.

It wasn’t a bottle of wine. They were carefully coddling a copy of the Holiday Wine Catalog from Ann Arbor’s Village Corner – circa 1977.

A quick flip through its pages elicited a classic “AHA!” moment: the eye-opening realization that my 401(k) might be riding significantly higher in the water if its early-on stock acquisitions consisted of Château Lafite and Château Latour, instead of GM and Citigroup.

Of course, that assumes my forbearance from indulging in too many celebratory pours out of the profits.

Like many long-term collectors of less-than-opulent means, I frequently joke that I can’t afford to drink the older wines in my cellar, let alone replace them at today’s prices. The price run-up among first-tier wines over the last 20 years has been little short of breathtaking.

But it wasn’t until I saw Village Corner’s price tag on a 1967 Château Mouton Rothschild – $21.95 – and compared it to the $600 tab on the soon-to-be-released 2006 vintage that it struck me how many years I may have been making wrong-headed investments.

A quick check-in at the wine pricing website Wine Searcher tells the story: even the two so-so vintages in the 1977 catalog, both currently well past their peak for both drinkability and price, showed price gains that handily beat the stock market during the intervening 32 years.

Investments in wines versus other instruments (image links to larger resolution file)

But if you take the trouble to store wine for 25 years, you may want to shoot for even higher returns. So I phoned Dick Scheer, Village Corner proprietor since 1970 and writer of the catalog I was browsing, for some tips about wine investing. Needless to say, he confirmed there’s more than meets the eye.

“Only a limited number of wines make a difference as investment grade,” Scheer told me.

Which ones? Primarily First Growths and a few other top Bordeaux, such as Petrus, Cheval Blanc, and La Mission Haut Brion.

My hypothetical 1967 and 1974 purchases pass the test. Both Latour and Mouton Rothschild are First Growth Bordeaux.

What about all those expensive wines on the shelves from elsewhere? They don’t make the cut for investment, according to Scheer. “Burgundy hasn’t mattered much. Neither has vintage Port. Nothing white, other than Château d’Yquem,” he advised.

The same goes for the tiny production, so-called “trophy” wines, coveted in recent years by high-end collectors. “Producers have learned that if you limit the release enough, you can sell it at almost any price. That’s the concept of the trophy wine, as distinct from investment. It’s meant to be shown off and poured. It shows my ability to buy,” Scheer said.

Vintages matter just as much as a wine’s origin. Not surprisingly, high quality, long-lived years make much better investments.

That’s where both the 1967 and 1974 Bordeaux earned failing grades; both years were mediocre at best, and entered into their terminal declines years ago. By comparison, the current price for a bottle of 1982 Mouton Rothschild – considered a top-tier vintage, still drinking wonderfully – ranges from $750 to over $1,000, several times those of adjacent lesser years.

What about the 1982 Château Latour? Figure on $1,500 and skyward for a single bottle. Not a bad return on your initial $40 investment.

So are you licking your chops, ready to grab the next top vintage that comes along and sit on it for 25 years? Not so fast, cautions Dick Scheer.

If you’d like to eventually sell the wine for top dollar, you’ll have significant overhead expenses – primarily storage and insurance. Many serious wine investors lease commercial temperature and humidity-controlled storage facilities in big cities.

Too much humidity can decay – “fox” – the labels. The wines are still perfectly good, but you’ll lose money for less-than-stellar esthetics. Too little humidity is much worse; the cork may dry out and shrink slightly, letting some wine evaporate and dropping the wine’s level in the bottle – a costly flaw in the resale market. And if you can’t document optimal storage conditions throughout the wine’s entire lifespan, it may also be worth less to some future buyer.

Want to taste just one bottle from a case and resell the rest? That’ll cost you big-time; whenever a wooden case is opened, it loses a lot of value. Or, as Dick Scheer quotes Ann Arbor collector Ron Weiser, “Never buy an eleven bottle case.”

Should people still buy wine today for investment, in hopes of 1982-style eye-popping returns?

Dick Scheer is bearish. “Investors need to know when to get in and hold back. Now is a time to hold back.”

Why? The main reason is the lack of excellent upcoming Bordeaux vintages – even 2006, with its $600 bottles of Mouton Rothschild, is merely an average-plus year. In addition, several market features have changed since the days when a small coterie of British “claret” drinkers dominated the market, buying two cases of First Growths in top vintages: one to drink and one to sell. Among the recent changes:

• The worldwide wealth explosion. “Now along come the Russians and Chinese and nouveau riche from all over the world. Latour to drink with sushi. They’re all in there bidding the prices up,” explains Dick Scheer.
• Much of the investor profits in previous decades actually came thanks to currency declines in the U.S. dollar versus the French franc. Now that Bordeaux prices are denominated in euros, that’s unlikely to continue.
• Investors formerly bought highly discounted “futures” on upcoming Bordeaux vintages, for nearly guaranteed instant profits when the wines were released. Nowadays, futures are marked up to the point where there’s little to be gained by pre-purchasing top wines.

“It’s a gamble,” concedes Dick Scheer.

So, I asked him, why invest in wine at all, compared to alternate investment opportunities?

“You can’t drink a piece of property or a bank account. The beauty is it’s a liquid asset; it’s a winning proposition because you can always drink it.”

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One final note: The front cover of Village Corner’s 1977 catalog listed the names of the store’s four wine salespeople. Dick Scheer owned the store then, as he does today. Rod Johnson worked there until last year, when he left to run the wine department at Plum Market. Ric Cerrini still sells wine at Village Corner. Only Steve Eliot departed Ann Arbor wine retail – for California, where he’s now Associate Editor of the Connoisseurs’ Guide to California Wine.

That’s a pretty amazing bunch of long-time wine professionals under a single roof – one that I doubt many local retailers, in any field, come close to matching.

About the author: Joel Goldberg, an Ann Arbor area resident, is editor of the MichWine website. His Arbor Vinous column for The Chronicle is published on the first Saturday of the month.