The global art market continues to strengthen, and wealth managers are paying attention. In fact, investment in this asset class is projected to increase by 66% during the next 10 years. According to the Deloitte 2017 Art & Finance Report, the estimated allocation to art and collectibles in 2016 was $1.62 trillion, and it is expected to reach $2.7 trillion by 2026. Christie’s alone sold over $4 billion in the first half of 2018 – up 35% from 2017 and its highest total ever. This includes the $835 million Rockefeller Estate sale, one of many single owner sales yet to come.
A recent article in South Florida Business and Wealth, “Art Emerges as Key Component in Wealth Portfolios,” discussed the growing interest in integrating art into wealth management strategies. The author, Sally-Ann O’Dowd, consulted with me in her research, and I’m happy to see this evolution in investment thinking, as it’s a practice I’ve been encouraging for many years. Art is an asset and should be treated like any other asset.
For wealth managers, knowing about their client’s art collections and collecting habits not only assists them in having a complete picture, but also gives them other touchpoints. For example, on the portfolio management side, wealth managers provide liquidity through loans secured by art. The Deloitte report estimates that this market reached $17-20 billion in the US in 2017, up 13.3% from 2016. And on the social side, they entertain their clients and become involved in their clients’ passions by partnering with art fairs and hosting events. All major art fairs are now sponsored by financial institutions, which benefits everyone involved.
Some upcoming fairs to put on your calendar (dates include VIP days) are:
– EXPO Chicago, September 27-30, sponsored by Northern Trust
– Frieze London, October 3-7, sponsored by Deutsche Bank
– Art Basel Miami Beach, December 5-9, sponsored by UBS
For more information on the above, or for a wealth manager recommendation, please contact me.
8/8/18