Whisky Business: Are Investors Setting Their Sights On Rare Whiskies?
“Whisky is an aspirational drink and that’s how it’s been marketed throughout the years”, says Joshua Tate, Asia director of spirits for US wine merchant Acker. But as the number of people developing a taste for a dram has risen, so too has its price tag. According to a Knight Frank Wealth Report, the value of rare whisky rose 564 per cent between 2009 and 2019, making it one of the fastest-growing luxury commodities on the market.
“At Bonhams Hong Kong in 2010, there were between 10 and 20 lots of whisky every season,” says Aaron Chan, a whisky enthusiast and owner of Hong Kong whisky bar Club Qing. “Nowadays, there are usually 500 lots for a single auction. More bottles switching hands means more transparent prices, and more opportunity for anyone to buy and sell. These are the two primary factors for an asset being investible.” Chan has been building his collection, which now numbers in the thousands, since 2008. He displays many of his rare and coveted bottles at his Lan Kwai Fong bar.
A jewel in this collection was the ultra-rare Hanyu Ichiro Full Card Series—he completed the 54-bottle set in 2013. “This collection was on display at Club Qing since the first day we opened, and over the years it helped us attract a lot of customers. In 2019, Bonhams Hong Kong auctioned a Full Card series for HK$7.1 million. I began to realise it would become unrealistic for me to open the bottles and serve them by the glass, so we set up a sale for my set.” It became the most expensive Japanese whisky set ever auctioned, fetching over HK$11 million at auction.
The news came as little surprise to Tate, who is expanding Acker’s presence in the whisky world in Asia. Tate cites Chan’s recent sale as one of many that highlight whisky’s growing potential. Another—a Yamazaki 55-year old with personalised engravings on the bottle—sold originally for US$31,000, before selling at auction later that year for HK$6.2 million. Further proof comes from Hong Kong-based collector Kam Daswani, who purchased a Macallan Edition 1 for HK$650 when it launched back in 2015; today, he tells us, they are being bought at auction for HK$18,000.
Interest is growing, says Tate. “With many new distilleries opening, it’s a much wider market.” But, rather than a downturn after the current boom, he predicts sustainable market growth, due in no small part to the burgeoning Asian market. “Whisky is much more of a global drink; it’s being produced—and drunk—all over the world."
While there’s clear potential here for investors, Chan warns that it’s not without its limitations, and that a passion for the product is non-negotiable. “Whisky is made to be drunk. The only way to know which bottles to buy and which to avoid is to try as many different expressions as possible.” This, he says, is the only way “to choose a bottle that will widely appeal to the whisky community in the future.”
This sentiment is echoed strongly by Daswani, collector and owner of high-end whisky retailer Dram Good Stuff. "My personal collection is based solely on what I enjoy drinking", says Daswani. "Everything is cyclical and, if for any reason, the whisky market should fall out of favour, I want to be able to enjoy drinking it all!"
“Taking timepieces as an example, there are collectors for Patek Philippe, Rolex and independents. The same applies here," he continues. "There is a certain focus that many investors zero into, and that lends to the collectibility of that category. Given the vast range of interest, everyone has a pet favourite which makes it a collectible to them. The sum of the parts makes the whole whisky world a Disneyland of sorts making the whole gamut ‘collectible’”.
Also, adds Tate, “consider things like availability and provenance. Choose a reliable distillery with a good reputation and strong auction sales records. Ask yourself: is it a limited-edition bottle? How easy is it to get hold of? How often does it come up on auction?” Ultimately, as with any commodity, he adds, “it comes down to rarity. Whisky is a finite resource, and you know you have something that can never be replaced.”