In a remarkable act of artistic philanthropy a collection of postwar and contemporary art worth £125m has been donated to the nation.

The London dealer Anthony d'Offay is giving almost his entire collection, some 725 works, for the price he paid originally, £26.5m.

Containing some of the finest works by the most renowned contemporary artists, the collection includes Diane Arbus, Robert Mapplethorpe, Joseph Beuys, Gilbert and George, Jeff Koons and Damien Hirst.

The gift, to be called Artist Rooms, has been made with the assistance of the National Heritage Memorial Fund (NHMF), The Art Fund and the Scottish and British Governments. Artist Rooms will be jointly owned and managed by National Galleries of Scotland and Tate on behalf of the nation.

“The announcement of the gift by Anthony d’Offay of works of art to the Tate and the National Galleries of Scotland is not only amazing and inspirational; it appears to demonstrate a very imaginative financial structure which ensures that while the donor receives the original cost of the collection, built up over nearly 30 years, the foregone profit, of nearly £100m, is a philanthropic donation of exemplary generosity,” says Theresa Lloyd, Founder Director of Philanthropy UK and philanthropy advisor.

Artist Rooms will transform the nation’s collections of contemporary art as a whole. The arrangement  includes a provision for the establishment of a £5m endowment fund by the National Galleries of Scotland and Tate, the interest from which will be used for the acquisition of further rooms by important contemporary artists and emerging young artists, ensuring that the collection can continue to grow in the future. 

An initial contribution of £500,000 each from the National Galleries of Scotland and Tate has been made towards the endowment fund. Anthony d’Offay has agreed to serve as an unpaid ex officio curator for five years.

“All our research indicates that major philanthropy arises from passion, wanting to make a difference and the desire for involvement,” says Lloyd. “This unique contribution to cultural life in the UK clearly demonstrates these attributes, in a spirit of generosity which, it is hoped, will not only inspire art lovers but other potential donors.”