New investment fund in Luxembourg

   |  5 May 2011  |  AMA  |  Tweet  |  LinkedIn

Luxembourg, 5 May 2011, Art Media Agency (AMA).

An investment fund specializing in art has been created in Luxembourg.  The fund focuses mostly on contemporary and modern art, but also on an aspect that investors consider risky– tribal art.

“Art Collection Fund” is headed by the duo Stanislas Gokelaere, financier and collector and the former head of Christie’s Europe, Bernard Steyaert.  The duration of the fund is six years and two additional years could possibly be added.  The two associates are hoping for a return to the order of 12%.  To reach this goal, they are hoping to raise more than 20 M€ before the end of the year and eventually, more than 50 M€.  It is an ambitious project and for this reason, the entry fee is approximately €500,000.

Since the end of the financial crisis, investment funds have been proliferating.  There were about forty in 2009 and only 25 survived the crisis, but this figure has increased since the start of the year.  Art funds are back in fashion which signals that investors are looking to diversify their portfolios.

“Art Collection Fund” aims for 35% of its investments to go into tribal art.  The sector is often considered unsafe, since there a number of forgeries on the market.  To reassure their investors, Stanislas Gokelaere and Bernard Steyaert will be working with no less than four experts, who are also art dealers or gallery owners.

About 10% of the fund will be dedicated to young artists.  This is a daring step that could prove to be profitable.  To minimize the risks involved, it has been decided to diversify the investments as much as possible.  They have resolved to acquire works with a minimum value of at least €100,000, never to spend more than 20% of their budget on one artist and not to invest in a work that represents more than 10% of the total fund.  The acquisition policy has been carefully planned and a loan system for investors has also been set up.  The art works can be borrowed to a client for a maximum duration of one year.

This attractive offer could attract collectors who do not wish to invest in pieces of which they will not be the sole owners.

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