Economy
Chinese take the art market by storm
By Andrew Moody (China Daily)
Updated: 2010-05-24 09:21
 |
Large Medium Small |
Magnus Renfrew, the fair's director, is bullish about the prospects for major sales to mainland art collectors.
"We are increasingly seeing far greater numbers of Chinese mainland collectors buying top level international modern and contemporary art," he said.
"The Chinese now have their luxury cars, yachts and properties and they are looking for different ways to express their wealth and sophistication."
Renfrew says Chinese buyers have become very discerning and are having an impact right across the art market, not just with record-breaking lots.
One who believes Chinese buyers are already having an impact on the world's art market is Morgan Long. She is head of art services at The Fine Art Fund (FAF), a London-based financial vehicle for investing in art.
"There have been examples recently where we have been bidding to acquire items for our fund but have come across frantic bidding from people from the Chinese mainland. We haven't been able to buy anything we wanted at the prices we were looking for," she said. She confirmed the world's art market has been buzzing after the Christie's sale in New York.
"There has been talk of one or two major buyers from China for quite some time but recently there seems to be a lot of interest from Chinese buyers for art works across a wide variety of price ranges," she said.
The FAF has been trying to capture some of the interest by setting up a dedicated Chinese fund, although it would be buying Chinese art works and not Western ones.
"We have been on a marketing trip to Hong Kong and Beijing recently and we have found quite a lot of interest," he said.
To capture this interest in art China might actually be getting its own first traded art fund.
The Shenzhen Culture Equity Exchange is later this year expected to launch one. It will be open to investors who want an alternative to investing in individual works of art.
Professor Mei from the Cheung Kong Graduate School of Business, who has been consulted on the new fund, said it could produce a better return than Picassos at $106 a throw.
"Major art works are to some extent like investing in blue chip stocks like Google in that they have already had their major price growth. If you invest in new talent and up-and-coming artists the returns can be better," he said.
But Ben Brown, who owns Ben Brown Fine Art, which runs major galleries in both Hong Kong and London, believes there is too much hype about the recent activity of Chinese buyers.
"I think there may actually be more of a market right now for major works in the Flemish part of Belgium than in the whole of China. I think mainland buying of significant Western art is a long way off," he said.
He said it could only benefit the auction houses, pointing to a Renoir in the recent Christies's New York sale which went for $8.8 million but had a guide of $5 million. The price was reportedly pushed up by a Chinese underbidder.
"Without the underbidder it would more than likely have sold for its reserve. He, however, has had the effect of increasing the price by around $4 million and generating some $600,000 of commission for Christie's, which more than pays their presence in China for a year. Just that one underbidder is worth his weight in gold," he said.
Ken Yeh at Christie's, who was present at the New York auction, has no doubt that the recent activity of mainland buyers is real and the start of something big.
He also believes they are making sensible investment decisions and not bumping up prices by paying silly money.
"They are buying because they like art but also for investment. If they spend $1m, $2m or $10m for a painting they want to make sure they will get a return five, six, seven years down the road. These are people who have got properties, shares and other investments and art is becoming part of their investment portfolio," he said.