- Why Careful Shoppers Are Great for the Box Office
- Black Friday at Best Buy
- Facebook's Biggest-Ever Holiday Shopping Season
- Facebook's New Dual Class Structure - Slow Steps to an IPO
- Can Murdoch Help Bing Challenge Google and Shift the Content Equation?
- Twilight, Inc., A Worldwide Craze
- Oprah to Leave Syndication in 2011
- Sony's E-Reader Shortage and the Digital Book Battle
- Salesforce.com Brings Facebook and Twitter's Social Capabilities to Businesses
- Sumner Redstone's Companies Face Off Yet Again
More Videos
- Why Careful Shoppers Are Great for the Box Office
- Black Friday at Best Buy
- Facebook's Biggest-Ever Holiday Shopping Season
- Facebook's New Dual Class Structure - Slow Steps to an IPO
- Can Murdoch Help Bing Challenge Google and Shift the Content Equation?
- Twilight, Inc., A Worldwide Craze
- Oprah to Leave Syndication in 2011
- Sony's E-Reader Shortage and the Digital Book Battle
- Salesforce.com Brings Facebook and Twitter's Social Capabilities to Businesses
- Sumner Redstone's Companies Face Off Yet Again
RSS FEED
MOST SHARED
- Timeless and Time-Tested Warren Buffett Watch Predictions
- Should Homeowners Be Able To Walk Away From Mortgage?
- Goldman Sachs Party Ban: No Gatherings of 12 or More
- Governments Must Take Steps To Avoid More Dubais: El-Erian
- Black Friday Sales Disappoint Investors; Amazon Up
- Dubai World Set to Restructure About $26 Billion of Total Debt
- Notre Dame Fires Charlie Weis After 5 Seasons
- Get Paid Six Figures to Wear a T-Shirt?
- Nov. 30: Unusual Volume Leaders
- Blue Nile CEO: 'We're Having the Best Cyber Monday Ever'
- Treasury Threatens Banks, Not Borrowers
- We're Approaching a Market Bubble: Portfolio Manager
- Hershey Shares: What Options Are Saying
- Nov. 30: Unusual Volume Leaders
- Why Careful Shoppers Are Great for the Box Office
- Blue Nile CEO: 'We're Having the Best Cyber Monday Ever'
- Best Online Retailers to Buy Now: Internet Analyst
- ESPN The Magazine’s Body Issue: A Financial Success
- Cyber Monday: The Last Vestige of Dotcom Hype
- Dubai World to Restructure About $26 Billion of Debt
- Lesson From Dubai: Start Cutting Risk In Your Portfolio
- Iranian Seizure of British Yacht Pushes Oil Above $77
- Should Homeowners Be Able to Stop Paying Mortgage?
- Buffett's Predictions For Next Year—And Every Year
- The World's Biggest Debtor Nations
- Goldman Sachs Party Ban: No Gatherings of 12 or More
- Fed Tweaking Plan to Pull Money Back out of Economy
- Scientists Gone Wild: Climate Debate Turns Nasty
Media Money
Text Size 
In this financial crisis it's surprising to hear anyone's earning a 10 percent plus return, and it's not too often you hear that investing in independent films yields consistent results. Well, surprise.
Despite the credit crunch, a unique hedge-fund backed boutique bank of sorts is busy as ever, investing in movies and earning consistent double digit returns.
Hedge funds have played a huge role in Hollywood, pouring some $15 billion into the movie industry over the past three years. Hedge funds have and continue to back film slates at the likes of Sony [SNE
Loading...
()
]Pictures, Viacom's [VIA
Loading...
()
]Paramount, and Time Warner's [TWX
Loading...
()
]Warner Bros., among others. But now with many hedge funds retrenching, these major slate investments are getting more scarce. (The existing deals are solid, but you aren't seeing many new ones).
But boutique lenders like Grosvenor Park and Aramid's Screen Capital International continue to raise equity, lending to films that usually cost $40 million or less. They use tax credits and foreign presales to guarantee they get their money back before a movie even hits theaters. Grosvenor Park, reportedly backed exclusively by New York Hedge fund Fortress, specializes in negotiating tax credits and rebates, and has financed movies including "Sisterhood of the Traveling Pants 2," P.S. I Love you," "Righteous Kill," and others. Grosvenor pioneered this business of parlaying tax credits and rebates in various U.S. states and countries abroad to collateralize their investment.
Aramid is backed by International institutions and individuals who aren't interested in Hollywood per se, but more so looking for an asset class unaffected by the economy. David Molner, a partner of Aramid and plans to invest about $300 million in film financing over the next year, most recently funding two thirds of the budget of Oliver Stone's "W". Molner says his company had a return in the low 20 percent range, net fees, last year, and expects that to drop to the low to mid teens this year. Yet Molner says his company's investments will benefit from fewer films being made.
With credit from Wall Street much tighter, these boutique banks are in higher demand, giving them a better selection of films to pick from, and allowing them to charge higher lending rates. And investors aren't pulling out—not only is their track record solid, but the movie industry is traditionally recession resistant, giving them more reason to have faith that this lending business isn't risky.
Questions? Comments?
Data is a real-time snapshot *Data is delayed at least 15 minutes