- All the rhetoric over trade wars and tariffs could take a toll on a California wine region that’s already seeing a slowdown in investor activity.California’s Temecula Valley wine region has been a popular place for Chinese investors, but lately there’s been a pullback in those dollars and some projects have “stalled.”
The Temecula area, located about 85 miles southeast of Los Angeles, has about 40 wineries and attracts nearly 3 million visitors annually. The Riverside County area is not as famous as California’s Napa wine region but is still a hotspot for tourism and boasts award-winning wines.
It has also attracted wealthy Chinese investors over the past decade through the U.S. government’s EB-5 program, or the so-called golden visa.
The EB-5 program allows Chinese individuals to invest as little as $500,000 in a business to get a green card. However, an escalating trade dispute between the U.S. and China could make it tougher to attract such investment.
“All that turmoil doesn’t help,” said Dan Stephenson, founder and chairman of the Rancon Group, a Murrieta, California-based real estate development firm.
Indeed, the Chinese earlier this month slapped a new tariff on U.S. wine exports. And Beijing could spur an anti-U.S. backlash that discourages Chinese citizens from investing in American businesses.
Regardless, there has already been a pullback of Chinese investors that’s not tied to the current trade spat. Beijing imposed policies a few years ago that curbed money outflows.
“It’s become much more difficult to get money out of China than it was two years ago,” said Stephenson.