Due Diligence on Old Wagon Road

One of the many spectacular views

After our trip to view the lots, we decided to put in an offer on the Old Wagon Road lot.  You probably guessed by now that we ended up buying it, but it was not clear to us that we should when we first put in the offer.

Our trip up there to see the lot raised a few concerns.  First, there was no water on the property.  It would be very hard to finance the lot without a well.  Second, the access to the lot was by way of an easement on a section of the neighbors property which she was using as a horse pen.  Third, the existing home was worthless and we would need a permit to replace it.  Finally, the land appeared to be viable for grapes, but the exact soil types were unknown.

With these concerns in mind, we put in the offer with a 30-day due diligence period.  We could use this time to do more research on the property and if there were still concerns we could back out of the deal with no penalties.  Chris made another trip to Oregon to further investigate the property.

The first concern was water.  On our initial visit, the neighbor told us that another potential buyer had tried to drill a well on the property and failed at 2 test sites.  In order to avoid a similar failure, Chris researched land characteristics that often pointed to water.  We also hired a geologist to help select a site to drill.  Between the two of them, they agreed on a location on the north west side of the lot.

The drillers made their way out to the lot and setup on the spot.  After only 30 feet or so, the team hit water.  They continued to drill to see if there was more water lower down.  The well ended up being around 150 feet deep with around 10 gallons per minute.  It was critical to find water on the lot and they had done it on the first try!

Drilling rig

The second issue was the access.  The road to the lot goes through the neighbors 3 acre horse pen.  She has it fenced off with gates at each end of the road.  We talked to her about it while we were doing our initial visit and she was open to the idea of trading the land.  This is an on-going negotiation, but we were satisfied that a workable solution could be reached, so we did not let it deter us from buying the land.

A larger issue was the existing home.  Yamhill County has very restrictive rules around building homes on properties.  If no home exists, you must show an agricultural income for some period of time before you can build a residence.  That process would take years.

Luckily for us, there was an existing home on the property.  The home was in terrible shape and would not be fit for someone to live in it.  We had the county out to the lot to tell us if we could get a replacement permit.  They were not concerned with the current state of the house and provided us a replacement permit that gives us 4 years to start building.

The most important concern, the unknown soil types, required soil samples from various locations on the lot.  We hired a soil expert to meet Chris and Peter (our real estate agent) at the lot to dig around.  We had found an old soil types listing compiled by Oregon in the 70s that gave us high hopes for the land.  As it turns out, the old map was not very accurate on the types.  After around 12 holes and a days worth of digging, the soil expert gave us a more accurate and detailed picture of the soils...it was good news for us as most of the land tested was suitable for grapes.

A chunk of the soil

One of the many holes dug on the lot

All of our major concerns were addressed and we proceeded with the purchase.  Our next trip to Oregon was as land owners!

The search for the perfect lot

After the trip to see the Willamette Valley, we decided to research properties.  There are many factors that make land viable for growing grapes: soil types, elevation, slope, slope facing direction, and weather patterns.  The land in the Willamette Valley is generally suitable, but the particulars of each property must be reviewed.  Since the land is good for vineyards, the land values in the heart of wine country are very high.

Our research started by simply checking out vacant land listings on Zillow.com and other real estate websites.  Chris spent many hours reviewing listings for the characteristics that make good vineyards.  He found resources online to analyze the elevation, slope, slope facing direction, and even soil types.  We learned later that the soil types map done in the 1970s was not all that accurate, but it still helped with our research.


We planned a trip up to Oregon to meet with our real estate agent, Peter.  He specializes in vineyard properties in the area.  He has a wealth of knowledge and many good contacts.

We selected 3 properties to visit:

1. Old Wagon Road - Our first stop was a 62 acre lot at the end of Old Wagon Road.  It is located west of Carlton in Yamhill County.  At first, Peter was hesitant about this property because of its location in the foothills.  When we got out there and looked around, he was slightly more encouraged.  The lot was used for timberland and was covered with trees of varying ages.  It had been logged not too long ago, so there were piles of the left-overs scattered around.  The terrain was mostly rolling hills with spectacular views - check out the pictures below. 

We already knew that the lot topography was suitable for vines.  While we were there, we looked more at the soil and it appeared to be high quality.  This lot was on the top of our list to pursue further (ok, so it was the first we saw and at that point, the only one on our list to pursue!).

2. NW Moores Valley Rd - Our second stop was a 20 acre lot on NW Moores Valley Rd.  We spent just a short time at this lot.  The road on to the lot was very steep and this seemed to continue on other parts of the lot.  We decided it was less desirable for our purposes.

3. Ford Road (I think) - Our last stop was a 75 acre lot on Ford Road.  This lot was completely covered in trees.  It was difficult to tell the actual topography due to the dense coverage.  We eliminated this lot from our list.

After viewing the 3 lots, we decided to move forward with the Old Wagon Road Lot.  We had high expectations for this lot, but we wanted to be sure.  We put in an offer and included 30 days for buyer due diligence.  During this time, we could go back to the lot to verify the viability.

The first thoughts of creating a vineyard

First, the back story:
Chris has had a life long dream of operating a vineyard and producing a world class wine.  His target area was the Willamette Valley in Oregon.  This area is known for its Pinot Noir, as well as Pinot Gris and a few other grape varieties.  Vineyards and wineries are tourist destinations in the quaint small towns of Oregon.

We took our first trip up there to see the wineries in April 2011. We  stayed at a small bed and breakfast near Newberg, OR. The Abbey Road  B&B is part of an old farm that has been transformed into a unique  experience for travelers.  The old silos had been converted into guest  rooms that overlook the farm and the the various animals.

While we were in the area, we stopped by several vineyards. The picture below is from Archery Summit.  We took a tour of the vineyard and winery.  It was amazing.  There are acres and acres of vines, a beautiful tasting room, and a modern winery. There is even a labyrinth of caves used for barrel storage.

We managed to see a few non-wine related sites as well on the trip.  We made a loop and hit Multnomah Falls, the Bridge of the Gods, The Resort at Skamania Coves, and Mt. Hood. All are great locations to take out-of-towners!

Lower part of one of the falls

Beth and Chris

The Resort at Skamania Coves

Mt. Hood - notice the snow...it was April :-)