The future of the art market with Dana Prussian, Art Lending Service, Bank of American Private Bank
THE ART BASEL AND UBS GLOBAL MARKET REPORT, AUTHORED BY THE RENOWNED CULTURAL ECONOMIST, DR. CLARE McANDREW, WHO FOUNDED THE RESEARCH CONSULTING FIRM FOCUSED EXCLUSIVELY ON THE ART ECONOMY IN 2005, REPRESENTS THE PINNACLE OF ART MARKET RESEARCH AND ANALYSIS. THE 2019 REPORT PROVIDED 5 KEY INSIGHTS INTO THE ART MARKET PINPOINTING A 6% INCREASE IN GLOBAL ART SALES WORLDWIDE, ACTIVE BUYING BY MILLENNIALS AND A GROWING PARTICIPATION IN ONLINE SALES AS LEADING INFLUENCES IN THE CURRENT ART MARKET.
HERE ARE THEIR FIGURES:
1. The US retained its position as market leader
In 2018, the US sustained its position as the world’s largest art market, accounting for 44% of sales by value – or a total of $29.9 billion, the highest recorded level to-date. The UK regained its position as the second-largest market at 21%. China was the third largest market at 19%, with sales reaching $12.9 billion – a decline of 3% year-on-year.
2. Millennials emerged as active market participants
“A very positive finding of the research this year was the dynamism in collecting by global millennials.While respondents in the US were predominantly aged 50 and above, in Singapore, 46% of collectors surveyed were millennials, while in Hong Kong the figure was 39%. Collectively, millennials accounted for just under half (45%) of high-end spenders, underlining the importance of this demographic.
3. The online market witnessed continued growth
The online market reached an estimated new high of $6 billion in 2018, representing 9% of global sales – up 11% year-on-year.
4. Auction figures rose 3% year-on-year
While economic and political issues drove risk-averse buyers and sellers towards private sales in the dealer market, sales of fine and decorative art and antiques at public auction still rose in value, reaching $29.1 billion. High-value works had the greatest impact on this sum, accounting for 61% of total sales by value.
5. Art Fairs continued to shape the global market
Art fairs continued to play a central role in the global art market, with aggregate sales estimated to have reached $16.5 billion in 2018 – up 6% year-on-year. The share of the total value of global dealer sales made at art fairs was 46%.
AT BANK OF AMERICA PRIVATE BANK, ART LENDING SERVICES, DANA PRUSSIAN, VP, HAS AN INSIDER’S VANTAGE POINT IN TRACKING THE EBB AND FLOW OF THE ART MARKET FROM THE PERSPECTIVE OF THE INDIVIDUAL COLLECTOR, DEALERS, AND ART AND CULTURAL INSTITUTIONS.
DANA, A WARM WELCOME BACK.
HOW DO YOU SEE THE CURRENT ART MARKET?
Even though total art sales has slowed since 2012, we’re still seeing a strong art market. Low interest rates and stratified wealth creation worldwide continue to drive capital toward art. The art market is ultimately driven by sentiment, so the greatest risk is a major geopolitical event that impedes global capital flow.
HOW DO YOU ANTICIPATE THE ARCH OF THE ART MARKET OVER THE NEXT FEW YEARS? DO YOU SEE A RETURN TO THE GALLERY SYSTEM OF THE PAST AND A RESURGENCE OF SMALLER GALLERIES OR FURTHER EXPANSION OF THE “UBER” GALLERIES?
We should keep our eye on how technology changes the landscape (online sales have yet to deliver meaningful scale or margin expansion), art fair fatigue, and new revenue opportunities for the major auction houses. I think the future of the gallery system will be based, in large part, on how a current push-pull resolves itself over the next decade.
The mega galleries, particularly the big 4 featured in Michael Shnayerson’s Boom (Gagosian, Hauser & Wirth, Zwirner, and Pace), are at a critical juncture. They are currently expanding their global footprints-and Chelsea footprints- in a big way. At the same time, the mega dealers who have built these empires are not getting any younger. We will have to see what their succession plans look like. With Pace, the Glimchers will look to next-of-kin, Marc. With Gagosian, Larry could be looking to Andrew Fabricant. It will be interesting to see how it all plays out.
DO YOU COLLECT YOURSELF?
Working on it! One of the many things I love about my fiancé, Joel, is that he was interested in art well before I met him in 2015. He owned a mix of prints and lithographs by Miro, Sam Francis, and Dali, all of which we brought with us when we moved into an apartment together. Since then, we have acquired a few pieces together, most recently a massive Evan Robarts Mop Painting from Bryce Wolkowitz Gallery. It’s a wonderfully textural black and white on linoleum from his Super Reliable series.
WHO ARE SOME OF THE ARTISTS THAT YOU WISH YOU OWNED?
A Chamberlain crushed steel sculpture is at the top of my list. Before he passed away, I had the chance to see Chamberlain at work in his Shelter Island studio, which is an experience that I will never forget. Of course, we are in the age of identity, so I would love to start a female collection: Grosse, Krasner, Frankenthaler…I would weep with happiness! Also Shantell Martin. I met her this summer at the Parrish Midsummer Party. She’s simply the coolest.
DANA, THANK YOU SO MUCH! THE LRFA BLOG IS SO APPRECIATIVE OF YOUR INSIGHTS.
BANK OF AMERICA PRIVATE BANK, ART LENDING SERVICES, IS NOT ONLY ATTENTIVE TO THE FINANCIAL ASPECTS OF ACQUIRING, COLLATERALIZING AND DEACCESSIONING ART BUT ALSO TO THE IMPORTANT PLACE THAT CULTURAL AND CONSERVATION PROJECTS ARE IN THE CURRENT ART WORLD.