“The whole market is going to change in how it’s transacted.”
The Fine Art Group Founder and CEO, Philip Hoffman, spoke to CoBo Social Managing Editor, Denise Tsui, about what the art market might look like in the wake of COVID-19.
To read more of his perspectives on the future of the art market, please click here.
“There are likely lots of collectors out there looking for liquidity who are just not aware that art-based financing can be a fast route to capital.”
Speaking to Bloomberg, CEO of Art Finance Freya Stewart discusses the two-fold increase in art-based financing enquiries during the spread of COVID-19.
To learn more about how clients are increasingly turning to their art collections for the security of readily available capital, click here to read the full article.
With galleries, auction houses and shippers temporarily closed, the art world has adapted fast to bring art onto our screens at home, recreating exhibitions, studio and canvas in the virtual world. Of course, some projects have been in development for some time, but current circumstances have accelerated the delivery of these products, whilst other platforms have long existed but are seeing greater transactional flow. We look at a selection of these developments, how their user experiences compare, and what they could mean for the future of how we transact in the art market.
ART FAIR
The first iterations of our new digital involvement with art began with Art Basel Hong Kong’s online viewing rooms, initially organised due to the political problems faced in the region but by the time it came to its opening date, a necessary installment to initiate the fair. Unsurprisingly the site crashed in its first moments, testament to the popularity of the Basel brand, but was soon up and showcasing viewing rooms of up to ten works per gallery. Specific retail prices or large pricing brackets could be shown, the latter requiring an inquiry to find out more, which hindered what could have been greater price transparency for the fair. Some presentations, including those of Lisson & Pace, offered a zoom walk through explaining their booth which worked with some effect to bring the works to life. Galleries varied in the quality of their viewing rooms with some offering installation and scale images, whilst others had just single images which felt like a jpeg slide show. Overall the fair reported some significant sales, not only offering hope for online transactions but also paving the way for other players, galleries and art fairs alike to take things online, faced with the reality that our sector was globally shutting down for a significant period of time.
Dallas Art Fair ensued, which largely followed that same format but offered galleries the chance to hide prices. There was also no zoom function which made assessing images increasingly difficult without requesting high res images from galleries – perhaps a way for trade to facilitate direct enquiries? Nevertheless, taking Dallas online has given global access to a smaller, less visited fair that we might not otherwise encounter IRL and highlights the increasing global connectivity that online access affords. Frieze New York will be the next major instalment of an online fair at the beginning of May and it will be interesting to note how they might have been able to profit from the do’s and don’ts of these earlier fairs.
AUCTION
Auction houses have long had a digital commercial presence, but unsurprisingly are shifting consignments to additional online sales. 21st April saw Sotheby’s highest ever online sale total with their Contemporary Curated London auction bringing in £5.1 million ($6.4m), sailing past its pre-sale high estimate of £4.7 million ($5.75m). It also included the highest price ever paid for an artwork in an exclusively online auction; George Condo’s 2005 canvas selling for £1 million ($1.3m) against a low estimate of £800,000. A positive signal that whilst these times are financially challenging for art businesses, transacting online is a viable revenue resource, even at higher price levels – a trend The Fine Art Group’s Managing Director, Guy Jennings, suspects will continue, “if this lasts six to nine months, people will become more relaxed about buying online at a higher level,” as quoted in The New York Times last week. Whether online sales continue in strength post-pandemic will remain to be seen.
GALLERY
A couple of weeks prior to the auction, Condo’s online show at Hauser & Wirth, his first with his new gallery, sold out before it even launched onscreen. Bidding for the Sotheby’s work was perhaps prompted by those who missed out on the primary works on paper priced between $100,000 and $125,000, inspired by isolation.
The blue-chip galleries have all differed in their approach to the situation. A number of galleries have opted for online exhibitions of shows that were due to open, if they have been fortunate enough to have been able to photographs works. Stephen Friedman’s latest exhibition of Andreas Eriksson included a virtual gallery space which you could move through to experience the works hung together; whilst a little rudimentary, it certainly offered a sense of scale and context for the pieces that can’t be found in a mere PDF.
Pace and David Zwirner have opted for more curatorial approaches, presenting online exhibitions in a holistic way, creating multimedia environments with artist created content, embedded videos and longer excerpts of art historically relevant material to contextualise their shows. Zwirner is also opting to use its position and power as a platform for younger or smaller galleries perhaps hardest hit by these recent times. Gagosian has avoided taking their scheduled exhibitions online as ‘that’s not how they were conceived’ according to the gallery’s owner Larry. Instead they are opting for their ‘Artist Spotlight’ series which invites a different artist to take over the gallery’s editorial and social media channels and transform them into a new multifaceted online platform for presenting a single artwork each week.
Most excitingly this period has seen an expeditated release of new technologies and apps that were in the pipeline but have now been forced into early fruition. These are notably being generated by the big blue-chip galleries with the ability to put their weight and capital behind these costly projects – which smaller galleries lack the resources to produce. Lisson Gallery has just launched its initiative with the software company Augment. The platform has been in development for the past year and a half and allows user to begin “placing” one of 100 available works into their own personal environments; not only easing the experience for clients but also businesses, enabling them to avoid the cost and travel implications of shipping works for consideration.
Massimo de Carlo has also just launched Virtual Space, or VSpace an immersive walkable experience accessed via their website or a VR headset. The inaugural show features works conceived especially for the virtual platform by artists John Armleder and Rob Pruitt.
Certainly not the only other notable tech release in this sector but Oliver Miro, son of gallerist Victoria Miro, has launched a virtual reality app named Vortic, due to be released with a joint exhibition with Victoria Miro & David Zwirner in the next few weeks. The venture offers galleries a subscription-based service with customizable virtual gallery spaces wherein they can show their art using virtual and augmented reality technology. The product is divided into two apps Vortic Collect and Vortic VR, the latter designed for use with a VR headset if owned, the former offering a virtual space.
With such a slew of new ways to experience art at home it remains to be seen which will stand the test of time. However, it has been a useful exercise to view art in a different environment, without a crowd or unaccompanied by in person salesmanship, with more room for careful consideration and time for contemplation. And despite some of these online initiatives working more effectively than others, it is testament to the art world’s resilience and the ever-creative methods industry traders are employing in an effort to keep their businesses going.
Critics and dealers are citing this as accelerating changes that were already taking shape in the industry, predicting a future where digital, online exhibitions become more frequent and physical art fairs reducing. Will this become the new normal? Digital developments help with accessibility, to widen audiences and connect an increasingly globalised art world; but we ourselves wait with bated breath for the moment we can experience art in the flesh again. These new platforms will provide an excellent accompaniment to transacting in the post COVID environment; however, we feel they will always remain in tangent with physical encounters to art, as opposed to replacing them altogether.
“A true real asset art loan (meaning a loan secured solely by art, without extensive borrower financial assets/liquidity tests) is very attractive for owners of high value art (and jewelry) because it’s a very straightforward way of releasing capital in short order, at a time where access to fast liquidity is so valuable for many people.”
CEO Art Finance and Group General Counsel of The Fine Art Group, Freya Stewart, speaks to Patricia Lee at Withersworldwide and discusses bank loan liquidity opportunities and current art loan challenges.
Read the article in full here.
In 2020 we celebrate the 20th anniversary of The Fine Art Group. Twenty years ago, I left Christie’s to launch the first institutional art fund. Today I’m proud to say that the Group has grown into a global market leader in the art world with a global team of over 30 professional staff acting for 140 clients in over 20 countries. We have advised and traded over $1.3 billion in value of artworks, with an additional $3 billion of private collections valued in just 3 years. While much has changed in the last twenty years, we’ve always remained true to our company values: offering preeminent art expertise, real transparency, independent, unconflicted, discreet, and innovative services to both the world’s leading art collectors and art novices and focused art investors alike.
LAST YEAR
January marked our much publicised acquisition of London based Falcon Group’s art-secured loan book, strengthening our long-term commitment to being the leading art finance provider to collectors and owners of high-value art globally. The acquisition marked a significant consolidation in the art finance market.
In June, via our Agency business we brought the landmark Maharajas & Mughal Magnificence to auction at Christie’s, New York. After a global tour of six cities and a marathon 12.5 hours of bidding, the collection realised a record-breaking $109,271,875 and was 93% sold.
Throughout the year, we have continually grown our business globally. Now, with representatives in China and Hong Kong, the United States, Switzerland, Germany and the United Arab Emirates, our network of collectors and art professionals is more far-reaching than ever before.
LOOKING AHEAD
As we look to the next decade, I am excited about developing our international art advisory, art agency, art investment and art finance houses. This year will mark the launch of our blue-chip art valuations service.
The Fine Art Group looks very different from the company I founded two decades ago. I am grateful to our exceedingly loyal clients, colleagues, and friends who have supported us from the start.
Yours,
Philip
Not so long-ago January was a dead month in the art world calendar – a collective trade hangover from the autumn season and the slew of dinners in the build up to Christmas. In 2020 it’s an increasingly full month, especially in London. To combat collector malaise associated with a ‘dry’ month – new year resolutions are not conducive to collecting – Condo is now in its fifth London year. Christie’s newly scheduled Modern British sales (on the thin side this season) and the London Art Fair (a localised,entry level event for modern and contemporary art), round off a relatively full few weeks in the city.
Condo has since spawned in New York (2017), Mexico City, Sao Paulo and Shanghai (2019). Condo London reaches across the gallery spectrum, with Sadie Coles, Pilar Corrias and Modern Art among the more established participating galleries. ‘Guests’ for 2020 hail from an incredibly dispersed gallery diaspora: LA, Istanbul, New York, Brussels, Hong Kong / Shanghai, Berlin, Toronto, Chicago, Tokyo, Jakarta, Glasgow, San Francisco, Warsaw, Athens, Mexico City and Vienna. A true microcosm of the so-called global contemporary.
Participation is intentionally cheap (guest galleries pay their hosts a very agreeable £700) and increased footfall the primary objective. The first few days are as close as London gets to a fully-fledged gallery weekend and it’s a remarkably successful way of encouraging gallery goers to traipse across London in the cold and wet. At best, it offers London collectors a chance to discover and acquire works by rapidly rising artists from distant gallery scenes. At worst, presentations are ham strung somewhere between an art fair booth and a true gallery show. Yet Condo is now an essential part of this drab month which is all the better for it.
Looking to the global art fair circuit, the first few months of the year have continued to fill. It’s logical that Taipei Dangdei and Frieze Los Angeles – both enjoying their second iterations – are scheduled for the middle of January and the middle of February respectively. There are few actually quiet moments left and some fairs already encroach on the sacrosanct July-August lull – it’s no surprise that the beginning of the year’s been successfully colonised. Both fairs enjoyed successful first outings in 2019, with Taipei 2020 reporting strong sales and growing, blue-chip roster. While in Barcelona, the art market’s answer to the World Economic Forum in Davos – the Talking Galleries symposium – is now in its eighth year.
It’s hard to imagine what else might fill the slow January weeks in years to come, but for now there’s more to see in London during the first few weeks of the year than ever before.
Images: Installation view, Sofia Mitsola, Darladiladada, Pilar Corrias, London. Courtesy of the artist and Pilar Corrias, London. Photo: Damian Griffiths.
Installation view, Condo London, Southard Reid hosting Öktem Aykut. Courtesy of Ahmet Civelek, Mert Öztekin.
“Whether you need guidance through the art market or wish to develop your taste and artistic knowledge, it is worth seeing the advice and support of experts. Philip Hoffman is one of the most experiences of these experts.” In the entrepreneurs issue of Credit Suisse’s magazine, Scope, our Founder and CEO Philip Hoffman points out that “collectors are no longer thinking of their art as a separate, purely passion-driven entity – they want it to be financially sustainable, secure, and efficient – from buying to storing to selling. I think both collectors and private bankers now appreciate how valuable proper advice is in this area.”
Follow this link to the full article to read about shifts in collecting trends, the importance of independent art advice, and how to borrow against your art.
In the Deloitte Art & Finance Report 2019, Freya Stewart contributed an article on the current state of the asset-based art-secured lending market, and the challenges and opportunities the next five years will bring.
“Awareness and understanding of art-only asset-based financing among the top-end collecting community and, importantly, their financial advisors and family offices, has without doubt risen in recent years…. In particular, significant younger collectors, and collectors who are entrepreneurs in other markets, are coming to recognize the diverse utility of art-secured credit facilities…
… The growing demand for art-backed loans is a natural reflection and extension of the increasingly sophisticated nature of the world’s most active and prominent art buyers.”
Read Freya’s full article on pages 120 – 121 of the Art & Finance report here.
Henry Little, Associate Director of our art team, is a frequent contributor to Phaidon publications such as Vitamin T: Threads and Textiles in Contemporary Art and most recently, Great Women Artists. Past and present female artists are gaining greater recognition throughout the art world, a shift this comprehensive volume reflects. Featuring more than 400 artists from 50 countries, this fascinating presentation of 500 years of female creativity ‘reveals a parallel yet equally engaging history of art for an age that champions a greater diversity of voices’.
The publication Great Women Artists will be available from 25th September 2019, visit the Phaidon website for more information.
On September 4th, Freya Stewart will be speaking at The Art Business Conference.
Now in its 6th edition, The Art Business Conference is an annual one-day conference, held in the heart of London. Through paneled discussions and speeches by leading experts in art, business, and technology, the conference provides an informed global perspective on key issues of the art market, and looks ahead to potential future developments.
Freya Stewart will be speaking on the subject of Demystifying Art Finance in conversation with Financial Times reporter Melanie Gerlis. Their session includes,
“Whether you own your own art collection, are an advisor seeking more insight for clients, or if you just want to know more about this rapidly developing market, this ‘need to know’ expert session will cover the ins and outs of art lending from loan costs and terms to financing for art business.”
Read more about The Art Business Conference here.