Art Investment Firms

This post is meant to bring some clarity into the art investment firm business. What is it exactly?
When investing in a portfolio, it's important to have a certain amount of diversity, you know, in case things don't work out with one of your investments so you haven't put all your eggs in one basket. Investing in art serves that purpose when diversifying your portfolio of investment, it provides another alternative for returns on assets. It seems like those investors from Wall Street want something new, high risk, high status, exciting, and hopefully beautiful- if they ever get to see the art they invest in.

The New Yorker wrote an article on the subject, which explains it well . Click here for full article.

"In 1904, André Level, a French financier, persuaded twelve other investors to contribute two hundred and twelve francs apiece to a new investment fund called La Peau de l’Ours (“the skin of the bear”), which was targeted at an unusual market: modern art. Over the next ten years, the fund bought more than a hundred paintings and drawings, including major works by Picasso and Matisse, before selling off its entire collection in a giant auction, at the Hôtel Drouot, in Paris, on March 2, 1914. The sale was more lucrative than even Level could have hoped: some paintings went for ten times the original price. When it was over, the partners found that they had quadrupled their initial investments."

A trick to making something valuable, is keeping it scarce, unique, and one of a kind. This type of investment brought high returns, however, can this still be the case with so many of these firms popping up in recent years?

Here's some of the names coming to mind:
Fine Art Wealth Management (UK)
Aurora Fine Art Investment Fund (Moscow, NYC)
Fine Art Fund (UK)
The Artist Pension Trust (Global)
The Art Trading Fund (UK)

Creating a Unique Art Collection

Sometimes people wonder what makes for a good art collection and what's the importance of art collecting? The easy answer is probably what makes the collector happy, what they like. However, most times this is a very ambiguous desire- most people don't really know what they want or like.

I came across an article with some insightful advice on www.artbusiness.com where "Step one is being true to your tastes. This means acknowledging that you like certain types of art regardless of what you think you're supposed to like or what seems to be the current rage. All great collectors share this trait-- that's one thing makes their collections stand out."

Collect what you like, this much is true at anytime, but what people also seeks is something of value, meaning something valuable to the eyes of others, something that is desired by many people, but only you possess it- that's a powerful collection.

Another insight is be open and look everywhere "Don't confine yourself to the same museums or galleries or wherever else you've been looking at art. Get out there and see what else is going on." This is important for diversity in the collection and avoiding a collection that looks like the next one.

A novice collector will buy what he likes because that's the initial first step. However, for the collection to mature it has to make sense and create links with the other items in the same collection so the collector will say "Not only do I love this sculpture, but it's also a prime example of the artist's best subject matter dating from his most productive time period and it fills a major gap in my collection." The collection is complete once all the pieces of the puzzle are fit together, the art consultant can then help to find these missing links and pieces.

Another interesting point is documenting your art pieces. Take the time to record the title, ownership history, artist statements, any associated stories, pricing etc. because once the collection has grown large enough you may forget some of the small details that made an artwork so fitting when you made the initial discovery.

To view the full art collecting posting see here.

Art Basel Prospects

As Sam Keller, the Director of Art Basel, resigns from his position, he leaves us with this advice:

"Change continuously with the art world,'' Keller, 41, said in a telephone interview from the Swiss city. "Listen to the galleries who have what it takes to make an art fair.''"

(From Bloomberg: read full article)

So what do these galleries have to say? As an art consultant, Art Basel is one of the major events for the primary art market. For galleries, it is highly recommended to invest art fairs since the exposure presents so many opportunities. Everyone is going to be there from the USA, to Europeans, to the Middle East, and Asia. The same advice goes to art consultants, clients will want to know what's up, especially at Basel, and especially because UBS (the main sponsor of the event) decided to close its art advising department. A sad moment, but it means we have to reassure clients of our necessity even more. It seems like changes are happening with a vengeance, I'll be curious to know what insight will come from Art Basel- I certainly am excited!

How 'bout a Miami winter?

I know it seems like a long time until December hits us, but it's not too early to start thinking about booking rooms and flights for this December in Miami.

Along with Art Basel Miami - the most famous, there will a slew of other fairs (and I'm just touching the tip of the iceberg):

Art-Miami:
The Miami Midtown Arts District
Midtown Blvd (NE 1st Avenue) between NE 32nd & NE 31st Street
Miami, FL 33137

Aqua Art Miami:
AquaHotel in South Beach, near Art Basel Miami Beach
and Aqua Wynwood in the heart of Miami's gallery district

Red Dot Art Fair
Wynwood Art District Art Midtown,
corner of 36th Street and NE 1st Avenue/Midtown Blvd ,
Miami, Florida 33127, U.S.A.

(image - Josef Albers, Homage to the Square: In Late Red, 1959.

This week I thought I would focus on an extensive corporate art collection - that of JPMorgan Chase.

The JPMorgan Chase Art Collection began in 1959 when David Rockefeller, then president of The Chase Manhattan Bank, established the firm’s art program and took the lead in corporate art collecting.

By using a programmatic approach to acquisitions, this collection became a model for other companies worldwide.

In 1960, under Rockefeller’s leadership, an illustrious group of art experts were invited to join an advisory committee to guide the program’s acquisition strategy and set the standard for corporate art practices and administration.

Joining Rockefeller on the Art Committee were renowned museum directors and curators, including Alfred Barr and Dorothy Miller (The Museum of Modern Art); James Johnson Sweeney (Solomon R. Guggenheim Museum); Robert Hale (The Metropolitan Museum of Art); Perry Rathbone (Museum of Fine Arts, Boston) and Gordon Bunshaft (SOM).

With a mandate for high quality and originality, the committee established the pattern that the firm follows to this day. The JPMorgan Chase Art Collection is now one of the oldest and largest corporate collections in the world, focusing on modern and contemporary painting, sculpture, works on paper and photography. The core collection is enhanced by a diverse range of objects from every country in which JPMorgan does business, offering a unique perspective on the firm’s culture.

Auction buzz

The art world is buzzing with news from the auctioneers. Both Sotheby's and Christie's held their spring Post-War and Contemporary Auctions this week, and things went a little bit better for Christie's.

From the New York Times: (read full article)

One night collectors seemed resistant to part with their cash; the next evening they were clamoring to bid. Such was the auction whiplash that occurred over a 24-hour period. Unlike Sotheby’s sale on Tuesday, where bidding was thin and buyers reluctant, Christie’s auction of postwar and contemporary art on Wednesday showed a different face altogether. It was a buoyant hour and a half during which record prices were set for recognized artists like David Hockney.

The sale totaled $93.7 million, just under its high $104.5 million estimate. Of the 54 works up for sale, only 5 failed to find buyers.


(image - David Hockney's Beverly Hills Housewife brought in $7.9 million for Christie's)

Consulting in lean times

Art Consulting is not for the faint of heart. It, like any independent small business, requires moxie, strength, ability to withstand not so great times, and a real g0-getter attitude. I'm lucky that this is a job I love and something that I've stuck with for enough years to forge some strong relationships. In times like these, I see all these newcomers to the art world struggling to find their footing and grasp on to any position available. 

For all those aspiring art consultants out there, I suggest that you keep doing what you love. Perseverance pays off in this sort of economy. And use this time to really seek out what you love - if you're working in a gallery and you'd rather be in a museum, try and make that change happen. Go out there to all the events you can find and network, network, network. 

I've recently discovered a very useful resource just for this - it's a sort of web content aggregator that recommends all these great events and exhibitions. I've been using it a lot lately. Check out MutualArt.com and let me know what you think. And for all those new grads  - keep your heads up and jobs will come along. You have your whole life to work and now to explore the art world in all its glory.