Clouds loom over Canoe Ridge Vineyard

The pioneering winery's owner, beverage giant Diageo, will shut down the local tasting room, but more changes could be in the works.

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The tasting room doors at one of Walla Walla's pioneer wineries will close late next month in a cost-cutting move by its London-based parent company.

Canoe Ridge Vineyard, a winery rooted by local investors more than 20 years ago, will close the public tasting room at its 1905 Cherry St. Engine House on July 25, an employee confirmed. No further details could be disclosed. A call to California-based Director of Communications Maire Griffin was not returned for comment.

The tasting room is reportedly one of several from Washington to California facing closure by corporate parent company Diageo Plc, the international drinks giant that owns Smirnoff, Johnnie Walker, Guinness, Captain Morgan and Jos Cuervo, among many others. Diageo announced last month plans to restructure its U.S. wine business, Diageo Chateau & Estate wines. Sales of the company's U.S. wines were reportedly socked by the recession and have been slow to recover.

What that will mean for the future of Canoe Ridge's wine production, created under winemaker Ned Morris, is unclear. A Diageo spokeswoman told "Wine Spectator" the company wants to focus on its core wine brands: Beaulieu, Sterling, Chalone, Acacia, Rosenblum and Provenance.

Spokeswoman Zsoka McDonald told the magazine the company is "looking at all options to get the most out of our non-core assets, including selling them."

But with Canoe Ridge -- as well as Diageo's Sagelands Vineyard in the Yakima Valley -- not included in that list of core wine brands, speculation has run rampant. Since tasting room operations are typically less capital-intensive than production, some suspect the tasting room closure is just the beginning of changes, and that the winery could be sold or closed down.

The company has declined to comment on specific brands or facilities that might be for sale.

A May story in Bloomberg Businessweek said about 90 jobs throughout Diageo's wine division are expected to be cut. That number represents about 14 percent of the 650 sales, marketing and production jobs in the division, McDonald told the publication.

The number of jobs that would be lost at Canoe Ridge's tasting room was not disclosed.

The closure brings an end to the public face of a brand built by local investors into one of the first large-scale wineries at the front of Walla Walla's wine town boom.

"Canoe Ridge's tasting room has been a long-standing presence in our community, and we're sorry that it's closing," said Elizabeth Martin-Calder, executive director of the Walla Walla Valley Wine Alliance.

Not initially intended as a winery, Canoe Ridge started as a vineyard planted in 1989 on land of the same name overlooking the Umatilla National Wildlife Refuge.

The winery was born in 1994 after local investors partnered with California wine company Chalone Wine Group of Napa. The partnership reportedly represented the first investment by a California fine wine firm in Washington state.

Chalone Wine was majority owner, while the large pool of investors was represented by Norm McKibben, Jim Abajian, Gary Bergevin and Terry Tucker ¬?-- all of whom continue as thriving players in the wine industry at Pepper Bridge Winery and Amavi Cellars, Forgeron Cellars, Bergevin Lane Vineyards and Reininger Winery, respectively.

The winery was a must-visit place among oenophiles in the days when many now-veterans of the industry were building their experience.

Anne Hull, now tasting room manager for Forgeron Cellars, got her first job in the wine industry managing Canoe Ridge's tasting room in the 1990s.

"It was one of the places to go," she said Wednesday. "Back then there were 10 wineries. Those of us that worked there back in the '90s, we were a family."

Though still considered new on a global scale, the wine industry in Walla Walla was still a shadow of what it is today. Hull and a group of friends were interested in wine and would learn about it through blind tastings before the days when Walla Walla offered an academic degree in winemaking and more than 100 wineries dotted the landscape.

She also learned more through Canoe Ridge's then-winemaker John Abbott and then-marketing manager Molly Galt. Both have since moved on as two of the four partners in Abeja.

"In the mid-'90s the industry was still so new," Hull recalled. "To be able to work and learn at the same time was great."

The location was also part of the excitement of the winery, she said. When Canoe Ridge opened, the refurbished engine house was the site for both production and tasting.

"It had this incredible history. We were all proud to share it," she said.

The facility was originally constructed as a garage and maintenance facility for a streetcar and inter-urban train system that traveled between Walla Walla and Milton-Freewater. The passenger service continued until 1931. In the early 1950s, according to history from the Canoe Ridge Web site, the building was converted to diesel and used just for transporting agricultural products. The line was retired in 1985.

Word of the closure was sad news to Hull. "I have so many fond memories of being there," she said.

It was also shocking to former shareholder Abajian.

"I have to admit I was taken back when I heard they were going to close," he said. "It is disappointing."

Abajian described the Canoe Ridge brand Wednesday as "the diamond" of the Chalone portfolio when it started. In early 2001 the Chalone Wine Group announced the buyout of the winery and its vineyards from the minority partners for about $4 million, plus the assumption of about $2 million debt. An expansion already under way at that time added the freestanding 19,000-square-foot building for offices and wine production.

In addition to hosting numerous visitors over the years, the winery employed an array of talented employees who moved on to start or work for other wineries, including Chris Dowsett of Dowsett Family Winery, Tim Sampson, co-founder of Yellow Hawk Cellar; and Rob Chowanietz, who went on as Washington winemaker for Corus Estates & Vineyards.

Though many of the Walla Walla investors also went on to other winery and vineyard ventures, Canoe Ridge was never the same, Abajian said. He said sales of the wine had dropped under the sole proprietorship.

In the consequent sale to Diageo, the economy has apparently taken its toll on the business where so many local wine industry professionals had a role.

"I think it's just a matter of economics," Abajian said.

Vicki Hillhouse can be reached at vickihillhouse@wwub.com or 526-8321.

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