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Purple Wine + Spirits is moving to Petaluma

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Key to a reconfiguration of Purple Wine + Spirits into a producer of higher-end beverages includes a planned shift early next year of its headquarters and dozens of employees from a rural farming community to Sonoma County’s second-largest city.

The company behind hit wine brands Blackstone and Mark West, each sold for hundreds of millions of dollars, now produces millions of cases annually for other vintners and is building a portfolio of its own upscale wine and spirits brands. To contain costs and recruit top talent, the 26-year-old company has leased offices on the Petaluma River waterfront that can accommodate about 80 employees, according to co-founder and proprietor Derek Benham.

“I’ve been commuting from Piedmont to Graton for 20 years, and I’m so over it,” Benham said. “The commute is not like it used to be.”

The goal is to move into 13,000 square feet at the Foundry Wharf commercial complex in Petaluma by mid-2019, he said. The location is closer to a deeper talent pool for sales and marketing expertise, and it is more centrally located to Purple’s production facilities in the Graton community west of Sebastopol, in Russian River Valley and in southern Napa Valley.

“We need to be closer to urban centers and airports,” Benham said.

The move is similar to those taken by other growing North Bay companies have taken in the past few years as the companies have grown in size. Key examples are the headquarters shifts of Amy’s Kitchen to Petaluma and Traditional Medicinals to Rohnert Park.

Partly behind the sale of the Mark West pinot noir brand to Constellation Brands in 2012 for $163 million was a chance to retool the organization, Benham said. A problem was the company had seven facilities with 180 employees involved with contract winemaking services in a labor- and capital-intensive fashion, he said.

“My history and the success I’ve had and the joy I get is ideation, creation and materialization of brands and monetizing them,” Benham said. “Fiddling with bottling lines and production was a huge distraction.”

In the five years after the sale of Mark West, he pared down the business, trimming employees and facilities. The American Canyon winery has the layout and equipment to work for much of the 4 million to 5 million cases that are bottled and moved to market annually for clients. The former DeLoach Winery on Olivet Road near Santa Rosa works for crushing and fermenting the 15,000 tons of grapes brought in annually.

The Graton winery was a converted apple plant before Benham and his brother purchased it to start Codera Wine Company in 1992. But the nearly 300,000-square-foot facility works better for spirits distillation and aging, as bourbon and rye whiskey largely is left in barrels to sit for years.

Behind the investment in sales and marketing is the big change that came after Mark West left the portfolio. At 650,000 cases at the time of the sale, it represented half the production of the company brands and most of the distribution clout, Benham said.

While the Avalon brand was among those that remained, it was in the $10- $12-a-bottle range that Blackstone and Mark West had excelled in but had become in an increasingly competitive space with slowing sales growth.

New brands Raeburn, Calisto and Scattered Peak have pushed bottle prices into the $18-plus range, with $45 for cabernet sauvignon. He launched Graton Distilling Company in 2015 and now has D. George Benham and Redwood Empire labels in the $35-$70 range.