Luxestreet offering will be backed by a diversified portfolio of luxury timepiece repurchase contracts, which will be held in a separate (SPV), LS Income 1 LLC. We structure each transaction as a true sale, rather than a loan, and purchase timepiece at an average LTV of 65% to asset liquidation value. Our strong underwriting team conducts a diligent multi level valuation and appraisal of each luxury timepiece. We retain legal title and physical custody of each timepieces. Storing them in an insured, bonded warehouse. Dealers remit a monthly custodian fee of 1.5% for the option to buy back the timepiece at par before the end of the 12-month term. We have an established network of more than 100 dealers.
Investment Type | Secured Promissory Note |
---|---|
Term | 3 year |
Issuer | LS Income 1, LLC |
Early redemption | 1-year min, redemption after 90-day notice |
Offering amount | Upto $10 Million |
Minimum | $10K |
Interest Rate | 12% Annually; Paid Monthly |
Investor Qualification | Accredited Investors only |
Use of Proceeds | Provide capital to commercial Dealers |
Risk Provisions |
|
Issuer D&O Insurance | Offering insured by TigerMark (AXA XL) |
(1) Source: Statistia
(2) Knight Frank. (2020, March). The Wealth Report - The Global Perspective On Prime Property & Investment
LuxeStreet offers investors exposure to investment-grade luxury timepieces, which as most alternative asset classes, have historically retained their value during economic downturns and are uncorrelated to traditional asset classes. Luxury timepiece have also had a very low annualized volatility of 3.1% since 2005, compared to 16.5% annual volatility of the S&P 500 over the same period.
Correlation Matrix | Luxury timepiece | S&P 500 | Barclays AGG Bond Index | S&P GSCI Index | Annualized Volatility*** |
---|---|---|---|---|---|
Luxury timepieces** | 1.000 | -0.048 | -0.252 | -0.032 | 3.1% |
S&P 500 | -0.048 | 1.000 | -0.054 | 0.062 | 16.5% |
Barclays AGG | -0.252 | -0.054 | 1.000 | 0.686 | 2.9% |
S&P GSCI | -0.032 | 0.062 | 0.686 | 1.000 | 15.3% |
Luxury timepieces have provided stable returns over time, having appreciated an average of 5.0% per year since 2005.
Annual Returns by Asset Class
Upon agreement, funding of 65% of asset’s value is released to Dealer
LuxeStreet assesses a monthly 1.5% custodial fee for maintenance of the asset and a pre-arranged buyback provision.
Client exercises buyback option
Client exchanges the asset for a new qualifying asset of equal or greater value
Client does not maintain custodial fee payments, resulting in termination of the client's buyback option and Liquidation of the asset from our trusted network
CollateralCustody and clear title to each watch we purchase |
Price RiskWe purchase watches as an average discount of 65% market value |
SecurityWatches are insured and stored in a guarded storage facility |
Value RetentionLuxury watches are recession proof and performed well in 2008 |
AuthenticityWe utilize internal bids and independent appraisers to value our watches |
UncorrelatedLuxury watches are uncorrelated to economic cycles and capital markets |
LiquidityWe concentrate on only the most accepted, liquid watch brands |
DiversificationWe maintain a large, diverse pool of luxury assets |
Interest Reserve2-month interest reserve account |
EscrowEscrow Account currently in place |
Loss
10% 1st Loss provision
|
RecourseEstablished dealer network to quickly liquidate any watches that are not repurchased. |