- Client: US national relocating to Europe
- Art Collection Value: Circa £50 million
Enness was approached by a US entrepreneur who was looking to relocate to Europe with their family. The client owned a significant art collection valued at approximately £50 million and wanted to explore financing against the collection to help fund the purchase of a luxury home.
The main challenge was the client's preference to retain part of the collection at their existing US residence. Several of the artworks held significant personal and sentimental value, meaning the client did not want to move them into a specialist storage facility. This presented a challenge because lenders providing art finance will typically require valuable artwork to be held in secure, specialist facilities during the loan term.
Enness explored the specialist lending market to identify a lender that could accommodate the client's requirements while maintaining appropriate security over the artwork. We successfully connected the client with a lender that was comfortable with the artworks remaining at the US residence, subject to the required legal protections and security arrangements.
Under the agreed structure, the lender's security interest in the artworks could be formally registered under the applicable US jurisdiction. The arrangement also incorporated appropriate insurance requirements and ongoing monitoring of the artworks' condition, providing the lender with additional protection while allowing the client to retain the collection at their home.
This bespoke approach enabled the client to leverage a substantial alternative asset without being required to relocate the artwork into specialist storage. It also demonstrated the importance of understanding both the underlying asset and the client's wider objectives when arranging luxury asset finance.
Art can represent a significant source of wealth for high-net-worth individuals, but its specialist nature means that conventional lending solutions are not always appropriate. Factors including valuation, provenance, liquidity, insurance, custody and the jurisdiction in which the artwork is held can all influence the structure and availability of financing.
Enness specialises in arranging bespoke financing against high-value assets, including art collections, for high-net-worth and ultra-high-net-worth clients. Our experience across specialist asset classes allows us to identify lenders with the appropriate appetite for complex and non-standard financing requirements.
If you are considering raising liquidity against an art collection or another high-value asset, speak to a Luxury Asset Finance Specialist to discuss your requirements.
Disclaimer:
This case study is for information and illustrative purposes only and does not constitute financial, tax, legal, investment or valuation advice. Art valuations can fluctuate and may be affected by market conditions, provenance, liquidity and other factors. Financing is subject to lender criteria, valuation, due diligence and the specific security arrangements agreed for the transaction.
Information contained in our case studies is for market and illustrative purposes only. In some cases, these may be made up of multiple cases and are for illustrative purposes only.
Some case studies are made up of enquiries that have come into the business, not all business completes, and the posting of a case study does not represent a completed piece of business.
Property values can fall as well as rise, and you may not get back the amount originally invested. Property investments can be illiquid and may take time to sell. Where borrowing is used, your property may be repossessed if you do not keep up repayments on a mortgage or other loan secured against it.
