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$230,000 Bottles Means Boom for H.K. Wine Vaults

Frederik Balfour Bloomberg.com 07/21/2011 20:07
$230,000 Bottles Means Boom for H.K. Wine Vaults - Hong Kong - lifestyle - food

Fergus Fung swipes his card across a sensor and waits as his face is scanned by a computer to match his profile. A steel door opens and the Hong Kong entrepreneur enters a vault that holds his treasure of Bordeaux and Burgundy.

This is the Hong Kong Wine Vault, one of more than 15 repositories that have been set up in the past three years in the Chinese city as it overtook London and New York as the world’s biggest auction market for top wine labels like Chateau Lafite, Domaine Romanée-Conti and Krug. The temperature is a constant 13 Celsius and humidity is 75 percent, protected by 4 inches of insulation on the walls, ceiling and floors.

“The facial recognition thing is a bit gimmicky,” said 35-year-old Fung, founder of the WOM guide to Hong Kong restaurants. “But with any wine cellar, security is a key issue.”

After Hong Kong axed wine duties in February 2008, imports surged to $858 million last year, from $185 million in 2007. Auction house Sotheby’s (BID) hasn’t had an unsold bottle in the city in its last 15 auctions and broke the world record in October with three bottles of 1869 Chateau Lafite that fetched HK$1.8 million ($230,930) each.

“It’s exploded, and you need logistics to support that,” said Robert Sleigh, who runs Sotheby’s Asia wine business. “Now there are world-class wine storage facilities in Hong Kong.”

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