Build it and they will come. That, at least, is the hope of entrepreneur Jim Thompson who has just converted four Second World War ammunition bunkers in Hong Kong into wine storage warehouses.
Crown Wines opened the facility a couple of months ago, and Thompson says it has the capacity to store around 200,000 bottles of wine - and do so in state of the art conditions (even the sodium light bulbs prevent damage to the wine). The bunkers are located just off Deep Water Bay Drive and proved the ideal architectural spaces to convert into cellars and bonded warehouses.
So how did the idea come about? "As a transport, storage and warehouse guy I always wanted to store wine," says Thompson.
"Then I was on a delegation to South Africa with Donald Tsang, and Donald said Hong Kong should be a wine centre. And when he came back he had one of his staff organize meetings on the subject. Greg De'eb [who is running the venture for Thompson] was then the deputy consul general for South Africa and he went to the meeting. They talked about the bunkers on that occasion. Greg and I met and he suggested this to me. I asked him to organize for us to see them."
The whole place was overgrown when they turned up to inspect the site. "When we saw them we both thought it could work, although it required a little imagination," he comments.
Thompson has transformed the site. A glass house has been erected at the front where members (ie those who store their wine there) can eat cheese and drink their wine. Likewise, there is a library which can cater for gourmet dinners.
Apart from filling the cellars, Thompson hopes the location will catch on as a place where companies (such as private banks) will hold special wine-tasting events for their favoured clients.
He says the reaction to the facility has been positive so far and the timing is good. "Traditionally people in Asia liked rice wines then brandy and now the trend is towards wines. So there's no reason why Hong Kong should not be a centre, a focal point, for that whole trend."
The reason for making some of the warehouses "bonded" is for tax purposes.
"The biggest problem with wine in Hong Kong is the duty and we are working hard to get that reduced. A lot of people, both Chinese and expats have big wine collections in England because that's the centre of wine trading. Those people are frustrated about having their wine there but living here. No one wanted to pay the duty to bring it here. But we can now move it from London to here, and put it straight into bond so there is no duty. It is then in their backyard, so if they have a party or want to drink some wine, they can call us and we can take it out - indeed literally a bottle at a time if they like. They then pay the duty on what they consume."
Hong Kong's wine duty is 80%, which (among cosmopolitan cities) is the highest in its peer group. In contrast, the duty in Macau is 14% and even China has the goal of reducing the duty from 34% to 15% by 2005. Singapore has a flat duty, which encourages people to import more expensive wines, and thus promotes a more sophisticated viticulture.
"Hong Kong's wine duty doesn't make any sense, especially given China's stated intent to reduce the duty," says Thompson. "It doesn't serve the purpose of raising revenue, it has just inhibited the import of good wines."
Indeed, Hong Kong has the lowest per capita consumption of wine of any developed city in the world. The average person drinks 1.8 litres per year versus France's 56 litres and South Africa's 14 litres per person.
Thompson knows the more the duty comes down the better his bunkers will do.
"I truly believe that in the next year or two the duty on wine will be reduced," he says.
