Classic Car Collection Finance
United Kingdom
£4.2M asset-backed facility secured against collection of 12 classic cars including Ferrari and Aston Martin. Tax-efficient structure preserving liquidity for client's property investments.
The Challenge
High net worth individual owned £7.5M collection of classic cars (including Ferrari 250 GTO continuation, Aston Martin DB5, Jaguar E-Type) held for 15+ years. Client required £4.2M liquidity for time-sensitive commercial property acquisition but wanted to avoid triggering capital gains tax event by selling collection. Traditional lenders uncomfortable with specialist asset valuation and custody arrangements.
Our Solution
Introduced to specialist fine art and collectibles lender. Structured £4.2M facility (56% LTV) secured by first legal charge over collection. Independent valuations provided by two Bonhams-approved specialist valuers. Cars remained in client's climate-controlled facility with agreed insurance requirements (agreed value policies, £50K excess) and movement restrictions. 12-month interest-only term with option to extend or refinance. Rate of 8.5% annually significantly below tax cost of forced sale.
The Result
Facility completed in 3 weeks enabling property acquisition. Client purchased £6.8M commercial building with £4.2M debt facility providing 62% of purchase price. Commercial property generated 7.2% net yield immediately covering loan cost and providing surplus cash flow. Client refinanced to commercial mortgage after 10 months and repaid asset-backed facility. Collection retained and subsequently appreciated 18% over 2-year hold period, avoiding £600K+ CGT liability.
Key Takeaways
- Specialized lender expertise in asset-backed loan was critical to success
- Completed in 3 weeks from initial consultation to funding
- Total facility size of £4.2M structured to meet client needs
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