Carlyle starts art lending joint venture

Carlyle and Pictet Group launched the secured specialty fine art lender with $280m in equity capital.

Athena Art Finance Corp., a specialty lender focused on providing secured loans for the acquisition of fine artworks, has been set up by The Carlyle Group and Geneva-based asset manager Pictet Group. The new joint venture was established with $280 million in equity capital.

Athena will lend to collectors against collections or individual artworks they already own to finance further purchases. The firm will finance up to 50 percent of the value of a conservative estimate for the collateral provided that the artwork has a deep and liquid resale market. Loans will be a minimum of $1 million with tenors of between six-months and seven-years.

The firm distinguishes itself from the private banks and boutique lenders that already finance art purchases by offering non-recourse facilities and longer tenors than the typical double digit interest rate short-term finance available, Carlyle said in a statement. The firm did not disclose how much it will charge for loans.

Athena will be led by Andrea Danese who has more than 20 years of experience in structured finance. 

Carlyle invested in the vehicle from the Carlyle Global Financial Services Partners II, a $1 billion fund that closed in 2014. Pictet invested from its private equity unit and brings a high-net-worth client network to the table. 

Managing director and head of the Global Financial Services Group, Olivier Sarkozy, said: “The $3 trillion-plus global art market is one of the least developed and least financially sophisticated markets of substantial size in the world. Athena’s substantial resources and relevant expertise bring a professionalized financial services approach to this underserved market.” 

Athena will not aim to sell or take an ownership interest in any of the works backing its loans, said the statement by Carlyle. 

“For too long serious art collectors and other market participants have been faced with limited choices when they want to borrow against art,” said Danese. “We aim to be an independent, trustworthy and flexible source of financing for the art market.”

Athena is headquartered in New York and was launched in March.

The Carlyle Group had $193 billion in assets under management across 128 funds and 159 fund-of-funds vehicles as of 30 June.

Independent wealth and asset manager Pictet Group is based in Geneva and had $449 million in assets under management or custody as of 30 June. It is owned by seven partners and has a presence in 25 cities worldwide.