Art & Finance Newsletter #30 - Vancouver art market sees influx of Chinese spending
Sadly the artist Joyce Pensato (pictured above) passed away this week. She was known for her gritty paintings of cartoon characters and her sharp & electric personality. She was a great painter and you should check out her work!
Onto the art market...
Gallery and former employee settle suit
Half a year after Lehmann Maupin filed a lawsuit against a former employee for allegedly stealing trade secrets, the two parties have reached an agreement and the case has been voluntarily dismissed. The gallery and Bona Yoo, who is now a director at Lévy Gorvy, resolved the dispute “without costs or attorney’s fees to any party,” according to a single-page judgement from Alison J. Nathan filed in US District Court for the Southern District of New York.
Neither attorneys for Lehmann Maupin nor Lévy Gorvy had immediately responded to a request for comment.
Lehmann Maupin initially filed suit against Yoo late last November and then filed an updated complaint on January 14. The gallery alleged that Yoo “surreptitiously copied valuable trade secrets” from its computer systems before she left and “maliciously corrupted” or deleted important information from the gallery’s database. Yoo’s plan, according to the lawsuit, was designed to impede the gallery’s business while simultaneously allowing her to use the information for her own financial gain at another gallery. (Lévy Gorvy was not named in the suit.)
Artnet - Gallery and former employee settle suit
Playing the currency markets with art
On the face of it, it may seem that little connects the impulsive passions of the art world with the calculated machinations of the currency markets. But for those involved with the art trade today, the two are increasingly intertwined.
At its upper echelons, the art market operates on a truly international scale. The average transaction is likely to involve at least three countries – a seller in New York, say, offering a work through a London intermediary that finds a buyer in Hong Kong. But not all countries are equal, nor are they as borderless as some might like, particularly when it comes to currencies. Hence, at every high-end auction around the world, there is a screen that immediately converts the bidding in the saleroom into a range of currencies, including the Swiss franc, China’s renminbi and the Russian rouble. In an effort to be more seamless, the art market has adopted the US dollar as its base currency – starting in the 1980s, when buyers from North America proved the drivers of a gradually globalising trade.
There are times when it suits market players to harness a more convenient currency, particularly when it comes to marketing. Christie’s managed to work some magic earlier this year when it announced ‘the highest art sales total in company history’ of £5.3bn for 2018. The dollar equivalent of $7bn was, however, not a record because, these days, the pound gets you considerably fewer dollars. That record was in fact made in 2014, at $8.4bn (then the equivalent of £5.1bn). Christie’s has its headquarters in the UK, so it’s fair enough for it to shout about these impressive results, but you can bet your bottom dollar (pun intended) that it made some noise about the sales total in 2014 too, when it declared that ‘This figure is the highest total for Christie’s or any art company in the history of the market.’
Gallerists in the primary market generally price works in the currency in which their artists get paid, usually the one local to the artist. This can work either way. At the Contemporary Istanbul art fair in September, some local galleries deliberately continued to price works in the battered Turkish lira to entice overseas buyers – to decent effect. The London-based dealer Lyndsey Ingram takes payment in US dollars and pounds sterling, but because she files her accounts in the latter, she says, ‘I take a bath on currencies the whole time’. Converting foreign currencies back into pounds sterling on paper, which she has to do when she files her accounts in the UK, may seem to dent her business’s results, Ingram says, but in reality the money doesn’t always cross borders and having two accounts functions well: ‘I can use my dollar account to pay for art fairs in the US.’
Apollo - Playing the currency markets with art
Vancouver art market sees influx of Chinese cash
With negative headlines about Huawei, espionage, and Chinese speculators driving up property prices, Vancouver may seem an unlikely place for a positive spin on Chinese investment. But artists in Canada's art-making capital say their work is being supported by a growing group of collectors from China, especially as new speculation taxes in British Columbia ebb at foreign real estate investments.
The locally based collectors, like Qingxiang Guo who lent his Claude et Paloma to the Vancouver Art Gallery's (VAG) Picasso exhibition in 2016, are now buying up work by Vancouver artists with abandon, according to artists and dealers working in the area.
Vancouver-based dealer Catriona Jeffries, who attended the Shanghai Contemporary Art Fair last fall and recently had some of the work of Brian Jungen—one of the highest profile contemporary Canadian artists she represents—“acquired by a very strong collector in China”, says that there are a number of “serious” collectors who move between Shanghai, Bejing and Vancouver in the last couple of years.
The steadily growing Chinese collector base often have new homes in Vancouver, according to Jeffries, and they “are increasingly informed [about Canadian art] and collect with a serious rigour”. It is estimated that a third of the city’s real estate is owned by Chinese investors after years of land-grabbing until officials imposed a 15% foreign-buyers tax in 2016, prompting investors to spend their money elsewhere.
The Art Newspaper - Vancouver art market sees influx of Chinese cash
Singapore was great, London next
I hope everybody in Hong Kong was safe during the protests of this past week. It was an interesting time to be in Singapore and speaking with asset manager who operate there.
The overall sentiment was that they expect to see more and more business shift away from Hong Kong and into Singapore. This has been happening for awhile anyhow, but probably will now most likely accelerate.
I'm in London 26th June - 17th July. Be in touch if you'd like to schedule a time to speak!
Speak soon,
Blake