Are new distilleries a good investment opportunity?

New whisky distilleries often have a cask programme in place as selling casks allows them to collect a large amount of capital quickly in order to fund their operations. If you are in the market to invest in buying a cask of whisky, where is the best place to begin? Follow our quick guide to new distilleries in the UK below:

Scotland

Ardnahoe Distillery, Islay – the Isle of Islay is a hot spot for whisky production with nine distilleries on this small island. A new entrant to the market, family-owned Ardanhoe prides itself on being a modern distillery following traditional methods and values. Now accepting orders for their 2020 private cask release this is your chance to buy a distinctive, peated malt whisky made on a fabled whisky isle.

 Ardgowan Distillery, Inverkip – plans for the opening of a new distillery at the Ardgowan Estate are well underway. The company will be creating a new maritime-inspired single malt whisky from its lowland distillery, maximising on its close proximity to the sea. All whisky will be matured in ex-Sherry and ex-Bourbon oak casks. With careful cask selection, the company plans to have whisky matured and ready shortly after the spirit’s 4th birthday.  Get in touch with the company directly to find out more about their detailed Investor Proposition.

Lagg Distillery, Isle of Arran – be part of a new island legacy. Bringing contemporary style to the traditional peaty flavours of Arran whisky, the Lagg Distillery is offering 700 first-fill ex-Bourbon barrels for sale. The rich, earthy spirit will become the staple of the Lagg Single Malt whisky for years to come. When you buy a cask you automatically become a member of the exclusive Lagg Cask Society.

Ireland

Boann Distillery, Drogheda – the Cooney family behind the Boann distillery have a wealth of experience in the Irish drinks industry. Their head distiller is Ireland’s youngest at 29 years of age.  As a Boann Cask Society member you have the opportunity to own one of the first 500 hundred casks – choose from Irish malt or Irish pot still whiskey, aged in sherry casks, bourbon barrels or port pipes.

The Powerscourt Distillery, Enniskerry – all aspects of whiskey maturation and distilling at Powerscourt fall under the careful supervision of Noel Sweeny. A master of the Irish whiskey scene, Noel was one of only two Irish distillers ever to be inducted into Whisky Magazine’s ‘Hall of Fame’ in 2017. This new distillery offers a cask programme with a limited run of 397 (200l) casks available.

England

Spirit of Yorkshire Distillery, Driffield – offering a very limited number of first fill ex-Red Wine and ex-Bourbon casks this offering from a true field-to-bottle English distillery is a great investment opportunity. All single malt whiskies from this distillery are named ‘Filey Bay’ after the local seaside location and will be light, fruity with notes of vanilla and citrus.

Wales

Aber Falls Distillery, Abergwyngregyn – situated in a small village at the gateway to the stunning Snowdonia National Park the distillery is unique in both production and taste. Using only Welsh malted barley and Welsh water the company plan to start releasing their single malts in 2021. Personal cask purchase is available through their programme ‘Club Llechi’.

Remember that when you are thinking about purchasing a cask of whisky, you need to decide if you are buying it for the fun of having it, bottling it and drinking it or if you view it as an investment. The difference being that with an investment when you sell your whisky cask you expect a financial return with a good increasing value.

Schemes vary from distillery to distillery, but usually, when buying from a newly established company the cask schemes have an original buy-in price that includes between 5-10 years of warehousing and a yearly sample sent to you. It is worth bearing in mind that additional costs and fees can be levied if you want to mature the cask beyond the initial time period set out or want an increased number of samples.

Extra costs can be incurred at the bottling stage and this often the point when investors wish to sell their whisky casks. A standard initial purchase price only covers you up to this point, but a cask that has matured for 10 years, for example, will be worth (usually) more than a new make spirit meaning you have an investment that has increased in value.  Barrels can be sold on to individuals at this stage, but are often purchased by syndicates who will share the costs between a group. Sometimes distilleries will buy back the cask from you once it reaches maturity, but this doubtless at less than current market value.