Monday 28 June 2021 3:00 pm

Whisky casks the new alternative asset class getting investors excited

Wine, art, now even non-fungible tokens – the list of alternative asset classes is as varied as it is long.

But whisky casks are making their arrival at the heart of the market, with the Knight Frank Luxury Index suggesting their values had shot up 534 per cent over a ten-year period.

And firms are getting wise.

Read more: City Spirits: Irish whiskey might be the star, but gin hits the spot too

London-HQed Elite Wine & Whisky are one such firm. After just shy of ten years trading wine, they saw the pandemic as an opportunity to expand their reach.

Founder Steve Bishop tells City A.M. that they’d looked at the idea of brokering whisky casks years ago. Along with his Executive Director Nick Green, they purchased some casks – but regulatory hurdles meant their efforts were pushed elsewhere.

Instead they focussed on building up their wine operation, which went very well indeed.

But at the start of the pandemic, “we revisited the whisky side just to have a look at the casks that we had purchased a few years ago and see what had happened. And to our delight, they’d done really well.

“We went back to some of our clients and said look, some of these have made 30, 40, 50 per cent over a few-years period, offered the casks out and made the client good money.

“So we then just started pushing on the whisky side. The wines took a total backseat.”

The firm has begun building up relationships right across the whisky industry, developing relationships allowing them to get hold of high-end, high-value casks.

“Alternative assets,” says Nick, “have always been very popular.

“It was always a chance for people to step outside that remit of traditional investments where you’re going to get a lower return but you get a lot more protection.

“But not everybody’s like that. Some people do look for a higher return, they’re willing to take a little bit more risk.”

But Nick does agree when City A.M. says there is something a little special about whisky.

“It comes with heritage,” he says.

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