Alternative assets
players EXPERIENCE DRIVE While these traditional passion assets and investment classes continue to offer strong yields, a number of other trends are emerging around where the wealthy are putting their money and the way they are purchasing assets. Paul Welch is founder and CEO of Largemortgageloans.com, a business that initially helped investors to raise funds for purchasing high-value real estate but has since made a move towards jets, yachts, cars and other assets. One shift we are seeing at present, he says, is around the way high-net-worth individuals are making purchases. “It might seem strange that a billionaire wants to come to a business like ours to raise money to buy an asset, when they could clearly buy it outright. But if you can raise credit fixed at around 2% for five years, make a 10%–20% return and hold on to your money in the process, there’s little risk and plenty of opportunity,” he says. “So we are certainly seeing a trend there, whether that’s in yachts, art, cars or jets.” Another emerging trend identified by Welch is the shift from biggest and best towards experiences. “It’s nothing new for people to want the largest yacht in the harbour, the rarest cars in their
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Instead of just wanting the biggest yachts, investors now want them to be able to go to places they previously couldn’t
garage, or the finest art on their walls,” he says. “But, increasingly, there’s a move towards the experience. And I think that will continue as we see more millennials – who are renowned for being focused on experience – coming into the market. “Yachts are a great example. Instead of just wanting the biggest yachts, investors now want them to be able to go to places they previously couldn’t – which might require the hull being reinforced to allow you to go to Antarctica, for example. One client has had a boat built to enable his family to go to see the Titanic.” Bruce Maltwood, Director of Sarnia Yachts, echoes that view.
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for the wealthy to invest their money. Since 2005, Mumbai has been the stand-out star, with properties worth more than £10m rising in value by almost 200%. There are other assets attracting growing interest, too. Rare musical instruments provided a 16% return in the 2016 index, which also tracked fine art, rugs, carpets and coins.