Mercer Estates

In 1978, Mike became interested in the wine industry and was able to learn first hand from Dr. Walter Clore, the man considered the father of Washington wine (Walt and his brother Don planted the first grapes on Horse Heaven Hills in 1972). Mike went on to plant vines in the Yakima and Columbia Valleys that would become the birth of The Hogue Cellars.

Bud's family lived right in Prosser, but he basically grew up in Horse Heaven Hills. His grandfather, Willis, built the Mercer Block building in downtown Prosser in 1906. The estate sold the building in 1948 to the Olney family. They owned it until one of Bud's daughters purchased it in 1993. Bud's second daughter, Julie, is now the owner of the Mercer Block buildings and is planning a 16-room boutique hotel upstairs. Julie also remodeled the Princess Theatre, Prosser's movie theatre (where Mike saw his first Elvis Presley movie) which she has converted into a live theatre and event space. When the remodel ran into some snags, Bud stepped in as lead carpenter and Mike worked on the project as assistant contractor for three weeks.

Bud and his wife Patsy owned carrot packaging plants in El Centro, California, and Eastern Washington until recently. "Up until about two years ago, we owned two large downtown buildings," says Bud. His dad, Milt, brought irrigation to Horse Heaven Hills in 1968. "It was the first irrigated water from the Columbia," explains Bud. "My dad was a pioneer. He was irrigating the land for cattle grazing. Forty years later, there are about 120,000 acres of irrigated land."

The Mercers planted their first vines in the early 1970s in Horse Heaven Hills. In 1978, they developed their first major planting, later selling the land to Paul Champoux. The Champoux Vineyard sells to premium wineries and is known for producing award-winning wines. Mercer land wraps around Champoux Vineyard.

In 2001, Mike sold The Hogue Cellars to Vincor. "At Hogue, we wanted to go beyond being a 500,000 case winery," explains Mike. "That meant we had to attract capital. It's the only way to do it. After I gathered advice, we went ahead and negotiated a fair price. Although the culture has changed, the core of Hogue, the winemaking, hasn't. My brother Gary is still there. Hogue Ranches is still the largest supplier of grapes to The Hogue Cellars—about 35 percent." Mike honored the five-year non-compete agreement he made as part of the sale. Vincor has since sold The Hogue Cellars to Constellation Brands. In 2004, Bud sold his carrot packaging plants.

After the sale of their businesses, Mike and Bud "were just doing the farms and scaling back." Then the kids got involved. "We wouldn't be doing this if it weren't for our kids," says Mike. "It's an exacting, demanding business. You don't go into it without covering the bases and hiring the right people. You have to focus on the business side and the quality of wine. Our parents taught us this about business—it's not a hobby."

Mike's daughter Barbara and her husband Ron Harle run Hogue Ranches. Mike and his wife Dora also have a 15 year old son, Riley. Bud and Patsy's son Rob runs Mercer Canyons. Rob and his wife Brenda have three children. Between all of their children, Bud and Patsy have 14 grandchildren.

Photo above: Ron and Barb Harle

"Ron, Barbara and Rob are really the people behind Mercer Estates," says Mike. "They wanted to do it. I see this as passing what we've done on to the next generation, just like our parents did for us. The kids like to give us credit for the winery, but they're the ones who brought this to us. They're very close. Rob, a Marine, volunteered for Iraq. He and Ron spoke every day while he was there. They're both very astute businessmen with different backgrounds. Rob is a farmer with an MBA and Ron is a CPA. It's been interesting to see how they come at the same business from different perspectives."

Photo above: Rob and Brenda Mercer

Ron is the CFO and managing partner of Mercer Estates. Rob's focus is on current vineyards and developing future vineyard sites from Mercer family land. Barb's contribution is on the creative side: imagery, tasting room design and promoting the brand.

So how are Mike and Bud involved? "I see myself as a consultant," says Mike. "And I see Bud as a rock star. He was a big hit in New York." Bud enjoys their role: "We just do the winemaker dinners, lunches and have fun."

Although they love to downplay their part in all this, they are very involved. "Our first phase was to get the winery to the point where we could handle production," says Bud. "The second phase is to get the barrel room and tasting room ready." The barrel room was finished in August. The tasting room should be completed in early spring 2009.

"Our master plan is to offer premium wine for a mid-range price," Bud continues. "So far, we've done that. Our philosophy is that it's great to have international visitors, but our bread and butter is the I-5 corridor—people from Kirkland, Redmond, Seattle. They're our audience."

"We love to tell stories and have fun, but bottom line, it's all about the wine," says Mike. "We want to further Washington State's reputation for high quality wine."

* David Forsyth moved to Zirkle Wine Company in 2012.
** Bud Mercer died in August 2010.
*** Wayne Hogue died in July 2010.

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Next month: we'll continue the Mercer Estates story with a look at the team they've put together and how Prosser is changing with the wine industry engine pulling it forward.

Click here to read Part 2

Click here to read Part 3

Connie Adams/September 2008

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