Painting the market

Before the banks of the world took a turn for the broke, dragging the big spenders with them, 2008 was a good year to be an artist in South Africa. Unprecedentedly high auction prices for South African modernist paintings at Christie’s and Bonham’s in London last year hinted that the global art market would train its speculative eye down south, and local art dealers thought as much too.

At the same time the first Jo’burg Art Fair, held in March, brought the revolutionary notion of owning art to the rank-and-file luxury goods consumer.
Then the purses snapped shut. Even Britain’s Damien Hirst, who in September pocketed £95,7-million from a solo auction at Sotheby’s, couldn’t flog a work of his for its reserve price of $1,8-million at an auction in New York two months later.

Hirst’s flop was read by many critics as a harbinger of the end of the global art economy, for the time being at least. Whether that is legitimate, a pertinent question follows from it: what will become of local consumers with a weakness for art in 2009 and beyond?

Ross Douglas, director of Artlogic and the Jo’burg Art Fair, suggests that although global art-buying is flagging, the long-term future of the South African market as promising.

“While there is an increased interest in contemporary art in South Africa there is less cash around. It’s really an issue of liquidity rather than an issue of people becoming disillusioned with buying art,” he says. “International sales are going to be more difficult than local sales, so for South African art now it’s going to be about growing a local market.”

Gallerists in the business of art as investment are gunning for “liquidity” in the extreme, intimating that now would be a good time to send them a cool few million for a Stern or a Pierneef. According to Graham Britz, owner of Graham’s Fine Art Gallery, “one cannot save through a recession; one must invest through a recession”.

Britz calls Irma Stern, JH Pierneef, Gerard Sekoto and Maggie Laubser the “blue chip” artists—painters whose works will maintain their value even through tough times and are a relatively safe bet for investors. “These artists have well-established markets here and abroad and sold for record amounts even after the Lehman Brothers crash,” says Britz. “In the past few years people have been willing to spend a lot of money on them, so I believe they will continue to be sound investments.”

Other experts are warier about championing art as a safe investment. Ian Hunter, a specialist in painting at Stephan Welz & Co in association with Sotheby’s, cautions that “buying only by artist’s name can be tricky if the art work in question is inferior in quality or atypical of the artist’s style. The big names in South African art, like Stern, Sekoto and Pierneef, have rapidly increased in value over the past few years. The works continue to grow in value provided that they are good examples and are purchased at a fair market-related value.”

The matter of gauging reasonable market value is complicated, given that in the auction arena the value of an artist’s work turns on the whims of excited bidders. The art market is nothing if not capricious, and king of kitsch Vladimir Tretchikoff’s sale record leap from R440 000 to R3,74-million at a Sotheby’s auction in May last year is a case in point. This volatility implies that art buyers might see enormous returns on their investments overnight, but equally, that they might not.

For art buyers who can’t bring themselves to stare daily at Pierneef’s billowing cumulonimbi or Tretchikoff’s olive ladies but still want to own high-value South African art, consensus among gallerists and art dealers is to buy William Kentridge. As Douglas notes, Kentridge’s overseas sales propel his local value. With his new opera, The Nose, opening at the Metropolitan Opera in New York in 2010, he might even trump Marlene Dumas in the sphere of South African expressionists turned famous.

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