In a statement to the Lusa news agency, Luís Encarnação explained that the decision follows the end of the lease agreement for the current space, owned by a private investor, and the "need to guarantee the continuity" of this winemaking infrastructure in the municipality.

"We are working on a solution that will allow the winery to remain in the municipality, preserving its economic and cultural importance," said the mayor.

Founded in 1954, Adega de Lagoa, one of the oldest in the country, has played a central role in the region's wine production, operating from its own property near National Road 125, at the entrance to the city of Lagoa, in the Faro district.

After facing financial difficulties, it merged with the Lagos winery in 2008, creating ÚNICA – Adega Cooperativa do Algarve (Cooperative Winery of the Algarve). It is the only cooperative winery still active in the Algarve, receiving grapes from throughout the region and producing wines with traditional varieties.

Given the economic situation, the cooperative sold the property to a German businessman, a transaction that helped pay off debts and maintain its operations, while remaining in the building under a lease agreement.

The building is for sale, and the company that owns it sent a letter announcing the termination of the lease, giving the cooperative until the end of October to vacate the space.

The mayor of Lagoa ruled out the possibility of the city acquiring the property "due to the high price requested by the owner," suggesting as a solution "the construction of a new building to house the cooperative."

"There is ongoing monitoring, and we are working closely with the winery's management to ensure its temporary transfer, which will be to the municipality of Silves, and its subsequent return to a new property in Lagoa," he noted.

Luís Encarnação indicated that a Prior Information Request (PIP) is "already underway" to "confirm the path forward with the planning department and the Municipal Master Plan (PDM)."