Los Gatos Weekly-Times

Los Gatos Weekly-Times File Photograph

Portal of Paul Masson Mountain Winery, Saratoga

City of Saratoga negotiates to buy the Mountain Winery

By Sarah Lombardo

After playing their cards close to the vest for some time, the Saratoga City Council seems poised to buy the Paul Masson Mountain Winery, once the home of the popular summer concert series.

After a quiet summer with no concerts and only a few concerts last fall, city officials have been negotiating with the owners of the winery, Mountain Winery Company Ltd., in the hopes of purchasing the property and bringing back the concert series. And with it, bringing back revenue for Saratoga businesses, said City Manager Harry Peacock.

"The restaurants have reported to us that since the summer series has ended, they've lost quite a bit of business," Peacock said.

Bill Cooper, owner of Bella Saratoga, said that when comparing the financial records of the restaurant's previous owner with his from the past two years, the restaurant has lost between $50,000 to $100,000.

"[The lack of a summer series] had a terrific impact on our business," Cooper said. "Any time you can fill seats, that's good. That was happening with the summer series. It provided visual exposure to Saratoga. You can't replace that with any kind of advertising."

Peacock said the city is interested in buying all but the lower 75 of the winery's 579 acres and would like to see the property preserved as open space. The lower 75 acres of the property lie within Saratoga city limits and are zoned for residential development.

"We're not looking to change the nature of the property," Saratoga Mayor Paul Jacobs said. "We would like to see that areas are open to the public for picnicking and hiking. That's certainly one of our goals.

"If we're able to accomplish this, this would be the largest acquisition of open space and park facilities in the history of Saratoga," Jacobs said. "It would benefit not only Saratoga, but the entire Santa Clara Valley."

How close the city is to purchasing the property is hard to say. Peacock cautioned nothing is concrete.

"We're still talking," said Peacock. He said negotiations have been ongoing with the property's primary owner, Ravi Kumrah, for some time.

Kumrah and his associates paid $6.5 million for the property, but Peacock said he doesn't expect it to be that valuable now.

"It's pretty hard to figure out how much it costs," Peacock said.

"We have now reached a point at which an offer has been delivered to us," Jacobs said. But he refused to discuss the price.

Bob Cullen, who represents Mountain Winery Company Ltd., said he wanted to stress that the city of Saratoga approached Kumrah with the idea of purchasing the winery, and that to his knowledge, no numbers had been discussed with his client yet.

"We haven't really sat down at the table," he said. "When you own a piece of property such as the winery, you're going to get lots of offers. It is my understanding that the city is in the process of doing what they have to do. ... We're waiting for a proposal."

The summer concert series began in 1957, seven years after wine production ended on the site. The series continued successfully for 30 years, bringing well-known musicians to the hillside's 1,750-seat outdoor arena.

The property was sold in 1989 to developer Ray Collishaw for $5.3 million. Collishaw changed the winery's name from the Paul Masson Mountain Winery to The Mountain Winery, filed for bankruptcy in 1993 and put the property up for sale again.

Kumrah and associates bought the winery in 1995, and except for a few concerts last fall, the concert series has been silent ever since.

Peacock said the city has not talked with any promoters about managing such a series should the venue be purchased by the city, but it would not manage such a series itself.

"Without some sort of agreement about purchasing the property, we don't think anyone would seriously negotiate a contract," he said. "We're just exploring the possibilities right now."

One of those possibilities could be how to pay for the winery.

Although Saratoga faces a possible $1.4 million revenue loss if the utility-users tax fails in the November election, Peacock said officials are not worried about how to pay for the winery.

"We've worked out how much we think we'll need," Peacock said. "We've got a number in mind and we can get long-term financing. That's not a problem."

"We are not looking to fund this from tax revenue or general tax funds," Jacobs said.

"We don't have the cash in the bank to buy [the winery] outright, but I can tell you that the genesis of the city's position is that we believe if we can negotiate the right price, the concert venue and the ticket sales can generate enough revenue to pay for the cost of the purchase. Of course, to do that, the price has to be right."

Whatever proposals are being sent back and forth, Jacobs said he did not wish to get anyone's hopes up.

"This is a very very complex process," he said. "There's a lot of work to be done here and a lot of talking still to be done."