Whisky tops Knight Frank Luxury Investment Index in debut

06 March 2019

Nairobi, Kenya – Rare whisky, featured for the first time in the Knight Frank Luxury Investment Index (KFLII), was the best performing collectable in 2018 with values surging by 40%, according to The Wealth Report 2019.

Coins (12%) and art and wine (9%), followed rare whisky’s performance in the year, according to data compiled by Rare Whisky 101 for the Knight Frank Rare Whisky 100 Index.

Over a 10-year period, rare whisky outperformed all other investments of passion, with the value increasing by 582%. Classic cars (258%), coins (193%), stamps (189%) and art (158%) made the top five best performers over the decade.

Each of the collectables set records in 2018: David Hockney’s ‘Portrait of an Artist’ became the most expensive work by a living artist having sold for US$90 million, while a 60-year-old bottle of The Macallan 1926 became the most expensive bottle of whisky ever sold at US$1.5 million.

Andrew Shirley, Editor of The Wealth Report, said: “The records set in 2018 show that wealthy collectors are still prepared to pay top prices for the rarest and most desirable objects of desire, and whisky is no exception.

“Rare whisky collectors are not only tracking down individual bottles but also seeking their own casks and are prepared to pay six- or seven-figure sums to get them.”

To offer its most passionate customers the opportunity to share a stake in some of its most iconic brands, Diageo, which owns 28 single malt whisky distilleries in Scotland, runs a formal programme called Casks of Distinction. The programme is open only to selected private clients and involves a very limited number of casks, according to James Mackay, Diageo’s Head of Rare & Collectable Spirits.

Locally, East African Breweries Limited (EABL) runs mini-mentorship programmes for its reserve brands with a view to wooing the growing class of collectors.

Tod Bradbury, Head of Rare and Collectable Whiskies at Diageo, said: “We are noticing a big increase in people educating themselves around the whisky category and some are building collections. There has been increased interest in closed (ghost distilleries) as well as our coveted classics like Talisker, Lagavulin and Mortlach.”

The Wealth Report’s Attitudes Survey showed Kenyan high-net-worth individuals (HNWIs) – those with a net worth of US$1 million excluding their primary residence – in 2018 allocated 3% of their asset portfolios to luxury investments such as art, investment-grade wine and classic cars, among other collectables.

Respondents to the survey said 14% of their clients increased their luxury investment allocations in 2018, with a further 18% expected to do so in 2019. More of Kenya’s wealthy are taking up luxury investments, even though nearly a third (32%) had yet to start investing in collectables in 2018. The percentage of non-collectors is projected to drop to 27% in 2019.

Of Kenya’s super-rich who own investments of passion, nearly a fifth (19%) are active collectors while an additional 40% are looking to start active collection. The majority collect cars (50%), jewellery (45%), art (35%), watches (25%), furniture and wine (20%), whisky (15%) and Chinese ceramics (5%).

The dollar millionaire population increased by 306 individuals to reach 9,482 in 2018 from 9,176 in the previous year, according to data compiled by GlobalData WealthInsight exclusively for The Wealth Report 2019. The number is projected to increase by 22% to 11,584 individuals over the next five years to 2023.

 

The Knight Frank Luxury Investment Index (KFLII)

Luxury asset

Price Growth

12-month

10-year

Rare Whisky

40%

582%

Coins

12%

193%

Wine

9%

147%

Art

9%

158%

Watches

5%

73%

Cars

2%

258%

Furniture

1%

-32%

Coloured diamonds

0%

122%

Stamps

0%

189%

Jewellery

-5%

112%

KFLII

9%

161%

All data to Q4 2018 except stamps (Q4 2017) and watches (Q2 2018). Reflecting demand Chinese Ceramics have been replaced with Rare Whisky. Following the decision of Stanley Gibbons to cease its coin and stamp indices this data is now provided by Art Market Research. Art is now based on the Art Market Research All Art Index, which tracks around 10,000 painters

Compiled by Knight Frank research using data from Art Market Research.com (art, jewellery, watches, stamps, coins, furniture) Fancy Color Research Foundation (coloured diamonds) HAGI (classic cars) Rare Whisky 101 (whisky) Wine Owners (wine)

 

The Knight Frank Wealth Report is available for download in full here: http://www.knightfrank.com/wealthreport

For additional information, please contact:

James Waithaka, PR & Communications Officer, on email: james.waithaka@ke.knightfrank.com Mobile: 0725 423 991

Notes to Editors

Knight Frank LLP is the leading independent global property consultancy. Headquartered in London, Knight Frank has more than 18,000 people operating from 523 offices across 60 territories. The Group advises clients ranging from individual owners and buyers to major developers, investors and corporate tenants. For further information about the Company, please visit www.knightfrank.com or www.knightfrank.co.ke