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April 26, 2019

When finance minister Tito Mboweni concluded his recent budget speech by highlighting the importance of our arts and culture, and went on to promote the idea of a new national museum among other artistic conduits, he certainly surprised many in the sector.

The question is, do we really need a new museum when our existing ones are underfunded and in a state of disarray? But maybe Mboweni was simply echoing the spirit that is currently sweeping the continent about the importance of national cultural heritage. Maybe what really matters is that the government has publicly stressed that art and culture should be a priority. The details of how it should be done can be refined later.

In 2018, French President Emmanuel Macron commissioned a report by Senegalese economist Felwine Sarr and French historian Bénédicte Savoy to make recommendations on how to deal with African cultural assets taken during the colonial era. He invited other European countries with important collections of African art o...

November 28, 2018

The growth of the art market is tightly linked to tax regulations. Policies relating to import VAT, tax incentives and artists’ resale rights have a profound effect on the art trade.

According to cultural economist Clare McAndrew, there is a growing perception that Europe has become an expensive and complex place to transact. This explains why, after the 2009 economic contraction, the recovery in the UK has been slower than in the US. The looming possibility of a no-deal Brexit will have further impact.

In a report on private art museums, the US and Germany boast, respectively, 48 and 45 private museums out of 350 worldwide in 46 countries. The art market knowledge company Larry’s List points to favourable tax breaks in both countries that encourage collectors to build museums and share their art with the public.

The US tax regime also favours private donations to museums. Collectors can deduct from their income tax the fair market value of an artwork at the time of a donation without hav...

September 21, 2018

Sotheby’s announced stellar results in August for single-owner auctions in the first half of 2018. In May, the collection of Morton and Barbara Mandel raised $107.9m with a 100% sell through. The American entrepreneur and his wife had assembled a collection representing important artistic movements of the 20th century.

At Christie’s, the collection of Peggy and David Rockefeller, comprising of about 1,500 objects spanning art, furniture and a variety of collectables, achieved a staggering $832.6m — the highest price realised for a single-owner collection.

Collectors play an important role in the preservation and display of works of art. Private collections often form the backbone of major institutions through important donations or the creation of museums.

It nearly doubled the previous record held by the collection of Yves St Laurent and Pierre Bergé, which sold for $443m in 2009.

While art collectors usually do not achieve the same level of attention as the artists and their dealers, th...

July 18, 2018

We’re often asked what the artworks that attract top prices are and what can explain the figures that reach stratospheric heights. To date, the most expensive piece of art is Leonardo da Vinci’s Salvator Mundi which sold in November last year for USD450 million at Christie’s in New York. King Louis XII of France commissioned the 44 x 66 cm painting in 1605. Next comes Interchange, an abstract canvas painted by Willem de Kooning in 1955. It was sold privately in 2015 for USD300 million, the highest price ever paid in a private sale for an artwork. The third highest price goes to Paul Cézanne’s The Card Players, painted in 1892, which was bought for USD250 million by the Royal Family of Qatar in a private sale in 2011.

Art existed well before money, as evidenced by prehistoric rock art. Like currency, the financial value of art is based on a collective agreement. Nowadays, increasingly wealthy buyers compete for instantly recognisable artist names. As a result, the art market announces on...

May 21, 2018

E-commerce has long revolutionised music and books but its impact on the art market is more recent. It was only a matter of time though. Over the past 10 years, the move online has been one of the biggest trends in the art market, second to the inexorable rise of the art fairs. ‘The biggest driver is the wider acceptance of e-commerce. This is how collectors buy everything else, so why not art?’ says cultural economist Clare McAndrew.

The online art market has matured and buyers have a number of options. Traditional auction houses offer timed auctions where the bidding takes place online only and over a period of time, as opposed to live auctions. Early adopters like Sotheby’s launched their online formats as early as 2004. Next to this bricks-and-clicks business model are online-only auctioneers of the likes of Paddle8 or Heritage Auctions, the largest online platform for art and collectibles.

Online marketplaces, such as online galleries and aggregators that offer fixed price options,...

March 19, 2018

Last month the Investec Cape Town Art Fair invited our art advisory to moderate a talk about investing in art and the kind of returns collectors can expect. The panellists, who included the founder of Artnaka, a London-based members club focused on contemporary African art, the CEO of Business and Arts South Africa (BASA) and the joint head of Wealth and Investments at Investec Cape Town, engaged in a stimulating conversation to explore the wide-ranging rewards that can be associated with investments in art. The discussion was particularly centered on contemporary African art and the continent.

Investing in art is about investing in value. It is about investing in the potential of artists and the potential of artworks. Art has dual values; a financial one, from which collectors can make healthy profits when they buy right, and an intangible one. The latter generally refers to the aesthetic value and cultural economists have coined the term psychic returns to describe the aesthetic pleas...

January 23, 2018

We’re often asked what limited edition prints are all about.  What’s the difference between an original work of art and a print? Should I buy an original or a limited edition? What are their respective artistic and financial values?

Things get confusing from the word go as limited editions are also called multiples and original prints. To keep it simple, printmaking entails transferring an original artwork onto paper using a variety of engraving tools, chemicals, quality paper and a printing press. The artist, or sometimes his printmaker or dealer, decides on the edition size, that’s to say the number of prints, which is then fixed. Each print is normally signed by the artist and is numbered using a fraction notation (for instance 1/25) to indicate the unique number of that impression and the total edition size.

In some cases there’s only one print, which is then called a monotype. Monotypes are typically more expensive than editions. So what’s the difference between an original artwork...

August 3, 2017

For many collectors, one of the thrills of collecting art is to share their collection with others. Shanghai-based collector Zheng Hao puts it well when he says that ‘to own a private collection is personal joy, to show a private collection is shared joy’. The pleasure may come in varying degrees from a personal sense of self-actualisation, the social capital attached to the status of collector, as well as the sheer joy of sharing one’s most treasured pieces with others.

The enormous reach of the internet, combined with its ease of access, has offered collectors a wonderful cost effective way to share their artworks with a broader audience. A number of online platforms are dedicated today to showcasing privately owned art. Independent Collectors, a community for collectors of contemporary art, was launched in 2008 to allow its members to exhibit their collections online. It is opened to all art collectors and it is free. With the success of social media, it is not surprising to see coll...

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