Investing in cars: fuel for thought
Although cars have taken a knock and been outperformed in investment terms by wine in the last year, there are still opportunities for a handsome return if you know where to look.
22 June 2017
The Isle of Man has long been focused on pursuing niche market segments, having now worked for a decade on aircraft registry which was followed by an equally successful yachting registry and online gaming businesses coming to the island.
The drive to attract online gaming has been a marked success, with this industry now accounting for roughly thirty percent of the islands economic income. The government has invested in high speed telecoms and power infrastructure which, when combined with grant assistance and their low tax regime, has led to a cluster of businesses opening.
On the back of this uptick, the Channel Islands Securities Exchange (CISE) announced in February 2017 that it would open an office in the Isle of Man and rebrand as The International Stock Exchange (TISE), allowing tech firms on the island access to a new source of capital.
Ella Pinnock is a director at Estera, the fiduciary services provider, and says these initiatives have proved rich sources of work: “Estera has seen many aircraft ownership structures for international corporations and HNWi’s and is on target to sign up its 1000th aircraft during 2017.”
She adds, “We have a mix of shipping and commercial clients locally and a number of relatively young, entrepreneurial, and successful enterprises in the e-business space.”
Dermot Hamill is head of wealth management in the Isle of Man at Canaccord Genuity Wealth Management. He says many of his clients are still generating wealth: “Our typical private client will be forty plus, and is often creating as well as building wealth.”
As well as this the Isle of Man boasts the world’s oldest continuous parliament, and its unique position as one of the Crown Dependencies that is also part of the European Customs Union creates VAT structuring opportunities for those wishing to place assets on the island.
Middle Eastern clients are also showing interest in using the Isle of Man which shows the scope of the client base is increasingly international, says Michael Shimmin, group chairman of Fedelta, one of the largest privately-owned trust companies on the island. “We are seeing a lot of work coming in for Middle Eastern clients, and much of that is property-driven. Clients have witnessed considerable insecurity around the world and a lot of wealthy individuals are saying they want to put their assets in a jurisdiction where they believe the rule of law will protect them. The UK is very good for that.” He says India, China and Brazil are also growing sources of business as HNWi’s from those markets seek to invest in the UK with Isle of Man advisers.
Katherine Ellis is group director of business development at Boston Group, a multi-family office. She agrees with a shift to larger, international clients: “In the last five years, we have seen a huge shift away from clients seeking one-off transactional services and structures, towards them looking for a much broader range of services. That’s partially driven by clients wanting to consolidate and have more of their services provided through a smaller number of relationships, but it’s also because things today are much less product-driven, and much more about service delivery and relationships.”
There has been consolidation in the wealth management industry, with Canaccord recently acquiring the client portfolios of Duncan Lawrie Private Bank in the Isle of Man, for example. But most predict a swell of business on the back of aviation, shipping, commercial property and online gaming, as well as the arrival of the TISE.
Pinnock at Estera finishes by saying: “The island has seen consolidation but has emerged as a leaner jurisdiction.”