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Stop Press: We are once more at Chelsea Flower Show.
Art and Investment
Investment has traditionally been confined to financial instruments – stocks, bonds, commodities – where there is a ready, transparent and established market for buying and selling. To succeed in the art market, in common with the property market, because of its diversity and the unique nature of each item, one needs specialist knowledge. Legislation, compliance and restrictions on investment funds have additionally restrained interest from investors in these markets, and consequently there are few investment vehicles available. The withdrawal of approval for art and property in Personal Pension funds left a gap for those investors who want to participation in those fields. Recent financial turmoil presents investors with an additional problem of where to invest when cash yields are low, stock and property markets are volatile and there is no apparent safe haven. Sovereign debt default would take these uncertainties to a new level. The attraction of investment in objects d’art are that they have :-
Tangibility – you can see, feel and admire sculpture, paintings and art of your choice. Who could not been inspired by Wilfred Pritchard’s “Dance Macabre”, evoking time and again sentiments which cannot be gained from a digital stock certificate. Art has ambience and provenance and lifts the soul and that is the intangible side – something you cannot touch, something that is priceless.
Portability – ever shown your mother in law your contract note showing a killing in July coffee futures – or maybe she would be more interested Isaac Kahn’s Harmony? The centrepiece at your dinner party is a nice flower arrangement or possibly a work from Frank Edmunds making a point on who you are. Your grandson remembers you long after you are dead for the beautiful amethyst chimney you gave him for his 12th birthday which led him to become a passionate geologist. Art transcends the generations and is one of the threads that carries us from generation to generation.
A store of value Quality Art transcends national boundaries, currencies and the erosion of inflation and is a protection against the increasing intrusions of bureaucracy in our lives. Oscar Wilde quipped, the cynic knows the price of everything and the value of nothing. The Ferrari body will rust and decay with time, but Lenkiewicz’s hand on Patti will be appreciated by those who appreciate a truly beautiful chassis.
Art for Investment Limited is a small, growing and ambitious company specialising in 20th Century, Modern and Contemporary art and sculpture. One of its assets, well placed near Farnham in Surrey, The Sculpture Park is the most atmospheric in Britain, with 150 renowned sculptors exhibiting. We are looking to expand our operations, taking on partners and or investors to participate in setting up and the promotion of an Art Fund. A specialist with the right contacts, qualifications and drive will be able to create a fund and use it to bring art investment to the general public. We envisage a partnership with either an individual or institution, wishing to broaden their scope of products and requiring expertise and knowledge of the contemporary art market to achieve those aims. The structure of the funds could include
Art Loan Scheme
An investor would place a lump sum to be invested on a fixed term basis in discretionary art purchases. The sum would be secured against specific items with an interest return at a premium rate. The investor would have the option to exchange any part of the loan or interest for works of art held by the company. This could suit people who are new to the market, are not sure of exactly what they want to invest in, and can use the flexibility built within the system to acquire works on a conditional basis.
Participating Art Loan Scheme
Similar to the above except that by prior agreement the investor would be assigned specific works - of his choice if that what was wanted - and would be in partnership with the company on any profits accruing.
Discretionary Art Fund
The pool of investment monies would be placed into a segregated fund and the fund operated much like a Unit Trust, with clients able to buy or sell units.
The list is not exhaustive and we are totally flexible in promoting the benefits of investing in Art. There are no minimum amounts for investment, although in order for any scheme to work, an investor will appreciate that administration on amounts less than £5,000 will most probably not be viable
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