A short drive south of Sacramento, in the Delta town of Clarksburg, stands the Old Sugar Mill.
Founded in 1934 as a sugar beet factory and refinery, the Old Sugar Mill was converted 20 years ago into a wine destination with more than a dozen tasting rooms highlighting local varietals from across Northern California.
The facility has also become a popular tourist destination and played host to events, parties, picnics and weddings.
Last week the Sacramento Business Journal first reported the Yolo County venue faced possible foreclosure after the death of the property’s owner, with millions of dollars owed in loan payments.
In response, a group of tenants that operate out of the Old Sugar Mill joined together to keep it open as foreclosure proceedings continue.
David Ogilvie leads the Old Sugar Mill Tenants Group, and is the owner and winemaker of Silt Wine Company. A fourth-generation farmer in Clarksburg, his family has deep connections to the local agricultural community and the Old Sugar Mill itself.
Ogilvie spoke with Insight host Vicki Gonzalez about how the tenants are working to keep the historic building running, and why foreclosure does not necessarily spell the end for the Old Sugar Mill.
This interview has been edited for length and clarity.
Interview highlights
What's your connection to the Old Sugar Mill, and the foundation of the tenant’s group?
We grow wine grapes now, but my great-grandfather who started our farm in 1921 started with growing beans, and eventually started growing sugar beets. [He] eventually came to know the owner of Amalgamated Sugar, and he worked with them to bring the sugar beet factory to Clarksburg in 1934-35.
The sugar beet factory closed down in 1993 and another investment group bought it and turned it into pretty much what it is today. Opened up in 2005 as a customer crush facility that houses 12 or more tasting rooms. When we're in a region that has this facility… it made us able to take our grapes that we were growing and turn them into wine. Evidently what I found out recently is we became one of their largest customers.
With the unfortunate passing of the previous owner, we quickly decided we needed to do something about this. I've worked with the other tenants and we formed this Old Sugar Mill Tenants Group to help pay the bills, landscaping, electricity, wastewater removal, those sort of things that you don’t think about as the day-to-day operations. But in order to stay open during this transition time, we needed to band together and do that.
For people who haven’t visited Clarksburg, what’s so special about this Delta Community?
It's hard to pinpoint one thing that makes us special. Really, the proximity to Sacramento. It's just a short drive down I-5. You cross the Freeport Bridge and you're in a different world. You leave the hustle and bustle of the city behind, and you come across the river to winding levee roads that are covered in oak trees and farmland. It hearkens back to yesteryear and a good quality way of life that we all enjoy, and we want to share.
Agritourism has become more and more a part of Clarksburg. When my great-grandfather started farming, [it] wasn't really the thing… and then when the Sugar Mill opened that really helped facilitate this agritourism. Now, we're really embracing agrotourism and the shining jewel in this region is the Old Sugar Mill, so it's very important to keep it going.
How does the Old Sugar Mill operate as a business?
It's one big property. The previous owner had his own business running out of there. It was called Clarksburg Wine Company [which] was a custom crush operation as well… I can bring my own grapes and have their team make the wine for me. That was one revenue stream.
It also had an event business where they're holding events for the tenants as well as wedding events and business events. And then there's all the old bays that stored sacks of sugar. Those bays have all turned into separate winery tasting rooms… each of them are paying rent.
We as a group have hired some counsel and they recommended that we continue to pay our rents. Whether or not that check gets cashed, we still must pay our rent in order to stay in good standing.
Once we have a new owner, we can renegotiate or not renegotiate… but setting that money aside really said, "OK, that money was being used by the previous owner to pay for all the things that we are now having to pay for." So there's hope that maybe in the future we'll be able to get reimbursed for some of the expenses we're putting out there to keep the place running. We want to just shout from the mountaintop that we are open, business as usual.
How did you find out about the Sugar Mill being at risk of foreclosure, and about the owner’s untimely passing?
We knew what was going on pretty quickly after the owner passed away on June 13. That following week is when I was notified by the general manager of the winery. There was a previous manager there as well, on the business side, that was trying to see where the chips [were] going to fall, how things were going to run.
Eventually he had to step aside as well and that's when on July 3 I sent an email to all the tenants and said, “hey, I think it's time for us to meet and start this group to work together.” We all met on July 7 and after that meeting everyone was on the same page. We shared all the information we had and said, “let’s move forward, let’s figure it out.”
The first thing we had to do is figure out who the lender was, and we were able to figure that out and they have been very cooperative. You know, this whole idea of foreclosure… carries such a negative term, but it’s actually a positive thing.
How so?
Because the lender has to do that in order for them to take ownership of the building and then put it up for auction. This foreclosure process is a way for us to have a new owner of the Sugar Mill. That is what is needed now… that new owner to come in and work with all the tenants to keep the place running.
This sounds like it could be a new chapter for the business. What is your confidence that there will be a new owner for the Old Sugar Mill?
Oh, I'm very confident. It's such a great business. It's really unfortunate the previous owner passed away, but just because of his passing doesn't mean that the business isn't sound and isn't a great opportunity.
We are in that proximity to Sacramento that really is becoming more used as a playground for people who want to get away and and enjoy wine, and not drive all the way over to Napa. There's a lot of opportunities [here.]
How are the tenants doing?
The businesses are doing well. We meet pretty much weekly. Sometimes it's a little pep talk and a lot of information sharing. I'm working with a lot of our vendors and making sure payments are done correctly. I'm giving all of the tenants the information they need to keep running and be confident in how we're moving forward. I'm not trying to do anything on my own.
We have these events, and everyone's just working together and making those happen without a hitch. We even had a lot of these tenants’ families volunteer[ing], to keep the weddings going with an unpaid staff. It’s great to see.
One tenant, after our first meeting, came up to me and said, “this is just great. I love being with this whole group of people. We're all in this together. We've been here for 19 years and I've never been in a meeting where everyone showed up.” That just shows a testament of the group that we've created and how we've banded together to move forward.
So if you were planning to go to the Sugar Mill this weekend or have events planned, is it business as usual?
I should say we're not actively going out and seeking more events, but we’re going to honor the events that have been scheduled, and work with those parties.
One thing that happened with going into foreclosure is that this timeline actually provides more stability to what we're doing. We want to know that we're not doing this forever. The foreclosure start date was July 24, so there's 90 days from there before you can do what the lender is going to do, which is a note of sale. That is notifying the county that [they’re] going to put this up for auction. That would happen no earlier than 21 days.
We're expecting that hopefully by the end of November we should have a new owner, and then that owner would be able to honor all those events as well.
