The Art of Investing
If there is one thing the global recession and fluctuating bank rates have shown us, it is that money is becoming increasingly less valuable left in the bank. With this in mind, more people are turning their attention to collecting and investing in art. This, we are told, is not only a pleasure but also a realistic and tangible asset that can have huge growth potential.
Several pieces sold by Bonhams over the course of the last year have been record-breaking, from Fragonard’s The Portrait of François-Henri d’Harcourt, which sold for £17.1 million, to the rare Buddhist (377 BC – 1017 AD) Indian carved stone temple step, selling for £553,250 – a world record for a temple step of this kind. The beautiful 1,000 year old pre-Hindu stone step is one of only six examples known to date from this period, making this discovery the seventh. “The past year has seen a series of records broken in Bonhams salerooms round the world, from London to Los Angeles,” Julian Roup (Bonhams’ Director of Press and Marketing) revealed. “This comes on top of the successful launch of the company’s new headquarters in New Bond Street, London.”
From art to fashion – in recent news, Bonhams sold a rare, fancy deep-blue diamond weighing 5.30 carats for a record price of $1.8m per carat, which was bought by Graff Diamonds. The diamond, set in a Trombino ring, was made by Bulgari, the renowned Italian jeweller favoured by Hollywood film stars, and the epitome of fashion and innovation during the 1960s.
Fashion brands in particular are becoming aware of the importance of art, and several houses have gone to great lengths to show their appreciation for the arts. Gucci, for instance, is an associate sponsor of Frieze Masters and Alexander McQueen will be taking part at Frieze London. Miuccia Prada, a longtime supporter of contemporary art, is allegedly opening a museum of modern art in Milan in 2015. It all makes sense – the HNW buyers updating their wardrobes with designer purchases are the self same buyers looking to invest in art works. “It’s convergent practice,” reveals Sigrid Kirk, co-founder of Arts Co. “Fashion houses become involved with art, or film and art. People are collapsing the boundaries between mediums.”
It’s not just fashion houses realizing the value of an artistic association. Jeff Koons has designed champagne bottle holders for Dom Pérignon, and Nicolas Feuillatte Champagne House champions an artist annually, by commissioning a piece to be displayed in their Reims HQ. Wine makers Bernard Magrez meanwhile have their own art gallery, featuring pieces from the established (such as Anish Kapoor) to the more up-and-coming.
Up-and-coming artists are good investment-wise, according to the Saatchi Gallery’s Chief Curator Rebecca Wilson. “Works by emerging artists have the potential for increasing in value and leading to future gains,” she reveals. “They are also much more affordable than bigger name artists, and much easier to access.” She recommends investing in pieces by artists including Golnaz Afraz, Vivien Zhang and Hossam Dirar. For those who like their photography rather than paintings, Zena Holloway is making a bit of a splash in more ways than one. The underwater photographer has already been featured in publications such as the Financial Times, but she’s also worked with Faberge, Nike….and Kylie Minogue.
Sigrid Kirk meanwhile, thinks the works to invest in are those by mid-career artists, such as Phyllida Barlow (whose exhibition Fifty Years of Drawings runs until 26th July at Hauser & Wirth London). “These people have years of solid work behind them,” Kirk says. Another growing trend on the art scene is Outsider Art. “Outsider Art has grown and grown – that is, art by untrained artists,” Kirk reveals. “There are numerous examples of it, but it’s not made for financial gain, it’s by people who just have to make it – it’s an outward manifestation of something internal. They raise the question of ‘what is art?’ because people think the intent has to be to make art, which is not the case with Outsider Art. But Outsider Art pieces are becoming quite collectible. Henry Darger and Morton Bartlett are two particular examples.”
Whilst many serious collectors are interested in the long-term return on investment, caution is urged to new buyers. Primarily, the piece you buy should be one you like, as the market is notoriously difficult to predict. Impulse buys are discouraged, but if you find a piece you like – no matter how off the wall – consider it an investment well worth making. “You should always buy what you like, as there is no guaranteed return,” says Kirk. “But if you’re going to invest in art, you’re not just investing money, you’re also investing into your home and your family – art in your home is enriching! Go to galleries and meet some artists, and get a feel for what you like. People seem to like content-rich material, of which art is a good example. Art is a luxury – it signifies something handmade and original and authentic.” She has some further advice for new buyers to the art world. “If you don’t know what you’re looking for, you can hire someone. Art consultants can help you invest your money into art, they can help someone building or expanding a collection, or they can take you on a tour to help you get a feel for what you like.” She adds, “If you learn as you go, you’ll find yourself moving away from ‘safe’ pieces to more challenging works.” That, surely, is one of the joys of investing and owning artworks – to appreciate it by continually discovering the layers and meanings imbued within. There is clearly beauty in investment.