Dear friends and shareholders,

In this special newsletter I provide a few updates on the collection’s recent and forthcoming activity this quarter, and on the fund’s performance, as well as some market news.

We have received our 2016 year end valuation from a leading global auction house and completed our year end NAV. In correlation with a troubled art market in 2016 (auction turnover was down 22% globally), our full year results point to a performance of -3.72% for the year, after all fees and expenses. The negative return is due to the very conservative external valuation provided by a leading international auction house, that reduced the total value of the collection by approximately 10% verses our book value on Dec 31, 2016.

Our actual realizations during the year paint a very different picture. There were 14 realizations during the year generating some $650'000 in proceeds, almost double our original cost for these works. The works netted us circa 17% above our book value (if one adds the 25% auction house premiums, that means the works actually changed hands for circa 40% more than our book value). The IRR on the capital deployed in these artworks was a very respectable +19.83%. Read the full performance analysis of the 2016 artwork portfolio here.

As we enter our holding and consolidation period this quarter, our focus has shifted from buying and raising capital to consolidating and promoting the important parts of our collection. Hence our PR activity has stepped up and in addition to the regular Museum loans we do on an ongoing basis, we had a few other opportunities to show works, discuss our activity and raise the collection’s profile:  

• We had an innovative collaboration with Valentino’s Haute Couture Spring/Summer 2017 show on January 25^th in Paris. Numerous artworks were on loan from the Tiroche DeLeon Collection, providing us with valuable social media exposure and press coverage.
• We are in process of organizing an exhibition of video works from our Israeli collection at the Modern Art institute in Kiev, Ukraine, opening on March 14^th, where I will also be giving a couple of talks and interviews.
• Immediately after Ukraine, I head to Beijing for the first Art Gallery Weekend and from there to Hong Kong for Art Basel where I will also give another talk at the Art World Forum.

I have just returned from an amazing impromptu trip to Accra in Ghana where a vibrant scene is emerging. I highly recommend visiting, see some beautiful colors on my Instagram @sergetiroche.

Thank you for your readership. Appreciate your thoughts and feedback and hope to see many of you somewhere on the art track in the coming months.

Best wishes,
Serge Tiroche, co-founder