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Rethinking Illiquid Wealth

  • Writer: George Fortin
    George Fortin
  • Jun 10
  • 3 min read

Updated: Jun 11

From Private Equity to Picasso, liquidity concerns are reshaping how the ultra-wealthy manage their portfolios.


A wave of portfolio rebalancing is rippling through the asset management world. In times of uncertainty, predictability becomes the most valuable asset—and today’s political instability and macroeconomic crosswinds are pushing allocators to favor liquidity above all. From public U.S. equities to domestic government bonds, capital is flowing back to the familiar and the tradable.


With nearly two decades in the investment world, I’ve seen this pattern before: when volatility spikes, liquidity becomes the strategy. But here’s the dilemma—what if a significant portion of your wealth is tied up in high-quality assets that can’t be liquidated without a steep discount?


How do you create liquidity from assets you’d never want to sell?

 

"If auctions and sales of art are understood to be driven by the three ‘D’s (debt, divorce, and death), there would appear to be three ‘L’s driving today’s world of art finance: liquidity, litheness, and long-term planning. How all these components fit together is a dynamic worth watching closely." -Riah Pryor, ArtBasel-


 

Institutional Investors Lead the Liquidity Rush

When Yale University announced it was exploring the sale of $6 billion in private equity holdings, the market took notice. This wasn’t a repudiation of alternatives—it was a liquidity play. Even the world’s most sophisticated institutional investors are not immune to the pressure of immovable capital.

Family offices face the same problem. With substantial allocations to private equity, real estate, and personal property, many are sitting on portfolios that are rich in value but constrained in optionality.

The Liquidity Crunch Is Real

According to the UBS Global Family Office Report 2025, the top three risks cited by family offices are:

  • Global trade war

  • Geopolitical instability

  • Persistent inflation and delayed interest rate cuts


These conditions are leading to a pivot toward liquid, transparent, and actively managed investments.


Meanwhile, the RBC/Campden 2024 Report shows that family offices still hold 30% of their portfolios in private markets, where delayed exits and longer fund cycles are locking up capital just when families want more control.

Hidden in Plain Sight: Art and Collectibles

Amid these liquidity concerns, one category is largely overlooked: art and collectibles.

These assets—artworks, classic cars, jewelry, and memorabilia—often represent a sizeable portion of their investable assets for high-net-worth individuals. Yet they’re rarely included in liquidity planning, mainly because they are perceived as illiquid and their collateral value is unknown by financial advisors.


According to Art Basel’s 2024 report, the global market for art-secured lending surpassed $30 billion in 2023, with continued growth expected as private banks and specialty lenders re-enter the space.


In a time of market uncertainty, unlocking this new asset pool, which has an estimated $3 trillion value globally, can provide a stronger collateral base for family offices and HNWIs. The infrastructure now exists to treat art and collectibles as bankable collateral.

Asset-Based Lending for Collections

For family offices managing illiquid wealth, asset-based lending (ABL) unlocks capital without disruption.


By using personal property as collateral, families can:

  • Bridge capital calls or seize new investment opportunities

  • Avoid tax events tied to the sale of appreciated assets

  • Preserve generational holdings while accessing working capital


Some lenders have a dedicated team for this subset of ABL, called collection-based lending (CBL). Just like ABL, these loans are usually structured as a line of credit with a maximum capacity that you can draw from.


A key consideration is that the unique nature of the collateral results in more negotiation than a standard ABL.

What It Takes: Operational Readiness

Liquidity through art lending requires preparation. That means:

  1. Inventory Control

    Maintain up-to-date records of every work, including images, provenance, and ownership history.

  2. Recognized Valuations

    Lending value appraisals from certified professionals, usually annually.

  3. Digital Documentation

    Provide condition reports, invoices, and certificates to support the lender's due diligence exercise.

The Bigger Picture

Your collection is not just a passion. It's capital.


In today’s environment, liquidity equals leverage. If the most sophisticated endowments are restructuring to regain flexibility, family offices should do the same—with tools that allow them to unlock capital from their most underutilized asset class.

Want to unlock the value in your collection?

Title empowers collection owners to transform art and collectibles into working capital—securely and strategically.


👉 Contact us to see how we can help you leverage collections to unlock liquidity info@titlecollections.com


 

 

 
 
 

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