Press Article

London property boom


First the Russians were credited with fuelling the London property boom. Then their wealth flooded into sectors from art to sports cars. Now the rush of roubles into Britain is credited with funding another rising market - champagne.

Along with wealthy Indians, the estimated 300,000 Russian émigrés in Britain have been credited with spearheading a sharp increase in sales of rosé and vintage bubbly.

As connoisseurs, buyers and makers gathered around spittoons for the industry's annual tasting in London's Whitehall, the largest in the world and featuring some 10,000 bottles of champagne, the industry was toasting a 5 per cent growth in the value of the British market last year to more than £340m, or 37 million bottles.

Sales of champagne, from the expensive labels of Dom Pérignon and Cristal to the supermarkets and their own-label brands, have increased in the United Kingdom for 11 years running.

Organisers said a modest 1 per cent rise in the volume of sales in the UK, the biggest champagne market outside France, was offset by "increasingly discerning" Britons buying more expensive types of fizz.

Sales of rosé champagne increased by 14 per cent, with a similar rise in single vintage and cuvée prestige or blended vintage champagnes. Such is the level of demand for rosé that some houses have already sold their 2007 allocation.

Françoise Peretti, the director of the Champagne Information Bureau, which organises the event in the Banqueting House on Whitehall, said demand was being underpinned by wealthy ex-pat communities in London.

She said: "In recent years, the area of London and the M25 has become truly cosmopolitan, in particular with the arrival of large numbers of Russians and Indian millionaires.

"Champagne was popular in Russia before 1917 and the taste for it remains. The rise in vintage and cuvée prestige is due in no small part to the Russians in and around London.

"But the British palate is also becoming increasingly discerning. The restaurant and food revolution in the UK has instilled demand for vintage champagnes."

Champagne-makers gathered at Banqueting House confirmed that production in the region will peak at about 380 million bottles at some point in the next decade, making sales of more expensive fizz the only avenue for growth.

Members of the Russian émigré community said it would be doing its bit to bolster trade. Aliona Muchinskaya, a former Russian journalist turned party organiser and public relations consultant, said: "As a Russian, you cannot have an event and not offer champagne. It is a prestige thing. Russians love champagne and the more expensive brands in particular."

Champagne accounts for about 40 per cent of the UK sparkling wine market, worth £830m. Mme Peretti insisted that the status of champagne as a "luxury brand" means its real competition is so-called super-premium spirits rather than other sparkling wines.

Indeed, with about 200 different champagnes representing 70 houses from the giants of Moët et Chandon and Laurent-Perrier to small co-operatives, the talk at yesterday's event was more about how to keep up with demand.

As recently as five years ago, rosé champagne was considered a niche market in Britain. Now it is the area of strongest sales growth, forcing growers to crank up production of what is increasingly called "the English champagne".

Peter Reeves, the head of Cattier champagne in Britain, said: "The growth in rosé has been extraordinary. There is a two-year time lag in champagne production - the wine made this year will not be available until 2009. So the rosé we have to sell this year was made in 2005, before the trend became clear. We are having to tell new customers we don't have any rosé available and can only sell to our existing clients."

In Banqueting House, the deals were being struck to secure supplies to Michelin-starred restaurants and to supermarkets, which account for nearly two-thirds of UK sales.

As one buyer put it: "People buy champagne to feel good about themselves. There are cheaper wines out there that are every bit as good. But champagne has cornered the market in allure and we fall for it every time."

Our love affair with fizz

According to legend, champagne was introduced to England in the early 1660s by an aristocrat who fled France after falling out with Louis XIV. Charles de Saint-Evremond, who is buried in Westminster Abbey, had a fondness for vin gris, a new wine from the Champagne region which he imported to England, where it found instant popularity.

Some say it was the English who went on to 'invent' champagne by adding sugar to the casks of vin gris to make it fizzy and supplied glass bottles to contain the air bubbles.

Another version is that a Benedictine monk, Dom Perignon, created the wine while trying to remove bubbles caused by secondary fermentation.

Whatever the truth, Britain has been a key market ever since. However, the market dominance of the traditional champagne houses is under threat from supermarkets, whose own-label champagnes have been declared by the food critic Egon Ronay to be as good or better than the more famous brands