A San Diego–based investment group has taken a stake in New Zealand–grown hops. La Jolla's FS Investors bought a New Zealand hops farm last year for $9.8 million, more than $32,000 per acre for the 300-acre farm that grows 13 kinds of hops, including such high-demand varieties as Motueka, Southern Cross, and Nelson Sauvin.
FS Investors has made a name for itself of late for leading the charge to establish a Major League Soccer team in San Diego (which reportedly would not bear the name Footy McFooty Face). It also holds stakes in Uber, Spotify, Fender Instruments, and the Sacramento Kings.
FS Investors bought the Sunrise Hops farm from the Eggars family, which has been farming in the region over a century. The Eggars put it on the market two years ago for a reported $10 million asking price
"Before we purchased this farm, I don't think a farm had been sold here in the past 15 years," says FS partner David Dunbar, noting FS Investors is the first outside group to buy a hops farm in the fertile region. "It's not cheap," he acknowledges, "but this is an area with amazing terroir. So we're competing with grapes, apples, stone fruit…we thought it was a reasonable price. I think time will tell."
Dunbar says the investment group had been looking to invest in New Zealand in some fashion, and credits Stone Brewing cofounder Greg Koch for planting the seed to move into hops agriculture, telling the group how highly valued — and hard to get — the hops are to local brewers.
Upon closer look, FS found the hops farm for sale and noticed the upward trend in hops prices in recent years. But the clincher, according to Dunbar, was the taste. "From years of drinking amazing San Diego beer," he notes, "there's something really interesting and differentiated about the hops coming from New Zealand; they have a flavor profile that doesn't happen anywhere else."
Dunbar has been living in New Zealand to manage top-level upgrades, including new equipment and plantings. The farm sits on the nation's south island, in the Upper Moutere region, between the towns of Motueka and Nelson, on the Tasman Bay.
Despite being on the other side of the world, the farm has been a destination of brewers near and far the past month, as this year’s hops have come to harvest.
"We get a pretty healthy stream of brewers coming through," says Dunbar. While a third party leased the rights to this year's harvest — which came in roughly 15 percent below average due to cold, wet weather — the 2018 harvest will belong to the FS group. About two dozen craft brewery reps have been visiting to review the farm and discuss future contracts. That includes brewers from as far away as Japan, Northern Europe, and, of course, San Diego.
Dunbar declined to disclose which San Diego brewers have already contracted a portion of next year's hops, nor whether brewers from his home town will find an easier time acquiring New Zealand hops from the property FS Investors have renamed Freestyle Farms.
However, he did say, "Generally, our philosophy is that we want to grow exceptional hops for the best brewers in the world…. We've gone out in pursuit of those folks, and — lucky for us — we don't have to go too far to find them. Definitely a healthy portion of our hops will wind up in San Diego."