nyartmarket.independenthq.comThe NYC Art Market Report - IndependentIndependent – NYC Art Market Report

Fair Features News Contact About Fair Features News Contact About Ch 1. Introduction 1.1 Ch 2. The New York Art Market 2.1 | 2.2 Ch 3. New York Collectors 3.1 | 3.2 | 3.3 | 3.4 | 3.5 | 3.6 Ch 4. Art Advisors 4.1 | 4.2 | 4.3 | 4.4 | 4.5 | 4.6 Ch 5. Art Market Regulation in NY 5.1 | 5.2 | 5.3 Ch 6. Conclusions 6.1 Chapter 1 Introduction New York is the global headquarters of the art market, with the highest market share by value of art sales in the world. It is also a center of high net worth wealth, has the largest population of millionaires and billionaires globally, as well as being the key financial hub of the US. In 2019, the US accounted for 44% of sales by value in the global art market, having held a premium position in terms of the value for most of the last 50 years. New York is estimated to account for up to 90% of those sales, making it the epicenter of the market in 2020. Although China and other more emerging markets have developed at a rapid pace in terms of both wealth and sales of art, despite some reduction in its margin, New York remains unlikely to decline from the ranks as the leading global international art hub. New York’s strength as a global art capital has been based around three fundamental areas: 1. The strong base of wealth within the US The strong base of wealth within New York and the US. The US has by far the largest number of high net worth (HNW) and ultra-high net worth (UHNW) individuals in the world, as well as a stronger and more developed upper middle-class than emerging regions, which gives depth and scope to the development of the market at different levels. New York City is not only home to the most millionaires and billionaires of any city in the world, but it is also the temporary residence of many global millionaires. In addition, New York attracts a global audience of wealthy collectors and vendors to the art sales hosted in the city, as a critical mass of the world’s greatest art is exhibited and sold at museums, galleries, fairs and auctions there. 2. A highly developed cultural infrastructure New York also has a highly developed cultural infrastructure, which is critical to supporting a healthy trade in art. Apart from being home to leading galleries and auction houses, New York has a dense and diverse range of public and private arts institutions, along with a wide range of specialized ancillary services for collectors and the art trade, including art insurance, banking, logistics and others. These services are supported by a network of experts, who also work independently throughout the New York art market in areas such as art advisory, appraisal, conservation, restoration and other specialties. The city is also a regular host to leading art fairs, exhibitions and other events, supported by a locally active community and diverse array of international visitors. 3. One of the most transparent centers worldwide for the art trade Finally, it is one of the most transparent centers worldwide for the art trade. The fiscal systems, the rule of law and the US Uniform Commercial Codes offer a high level of protection to local and international buyers and sellers, while giving businesses sufficient incentives to encourage inward and outward trade. Compared to many other nations, the US has a relatively business friendly fiscal environment and liberal trading regime which has been key in ensuring that some of the highest priced works of art in the world are sold in New York. While these key strengths have solidified its leading position over many years, New York has faced some of its biggest ever challenges in 2020, many of which have had specific and acute effects on the art market. The COVID-19 pandemic forced the temporary closure of most galleries, auction houses, institutions and events, as well as leading to an exodus of many wealthy collectors from the city. The steady flow of international and domestic visitors, which totaled close to 67 million in 2019, has also been slowed significantly 1 . New York was not only one of the most severely affected cities in the US by COVID-19, but the crisis came on top of pressure already building in the city as art businesses, artists and others struggled with the rising costs of operating there. At this difficult point, this study aims to provide a descriptive picture of the New York art market, showing how it may be best placed to deal with the current challenges it faces. The report presents the findings of research carried out in 2020 on established New York collectors and their interactions in the market, as well as a survey of art advisors, who form a part of the critical network of art market expertise in New York. It reviews the strengths of New York’s collecting base, art market, cultural infrastructure and regulatory frameworks, all of which will be crucial to the speed of its recovery from the current crisis. Key Findings New York Art Market 01 New York is the global epicenter of the art market 02 New York is a leading host city for global art fairs 03 New York is a key center for the art trade, artists and artists’ estates 04 The bulk of the US cross-border trade in art enters and exits via New York New York Collectors 05 New York collectors have some of the world’s largest collections 06 New York collectors are significantly less investment driven than their global peers 07 New York collectors spend an average of $759,000 per annum on art 08 80% of the works in New York collections are by living artists 09 84% of New York collectors most often buy art at prices less than $50,000 10 The majority of the works in the collections of New York’s millennials are by emerging artists 11 Galleries are the most used channel to purchase art by New York collectors 12 26% of New York collectors have never made a purchase online 13 Over half of New York collectors prefer working with New York-based galleries New York Art Advisors 14 60% of advisors’ purchases or sales through galleries are New York-based 15 74% of advisors prefer to work with New York-based galleries 16 Advisors based outside New York make an average of 10 business trips to the city each year 17 New York-based advisors advise on sales or purchases of art worth $33 million per annum Events & Art Fairs 18 New York collectors are highly engaged with gallery exhibitions and events 19 74% of advisors use art fairs often or always to purchase art 20 New York-based advisors prefer New York-based fairs to source and purchase art 21 76% of New York collectors are willing to attend events in New York in the next 12 months Load More Load More Chapter 2 The New York Art Market 2.1 Sales in the US Art Market The US has retained a lead in the global art market for most of the last 50 years, supported by one of the world’s largest bases of HNW and upper-middle income wealth in the world, as well as a highly developed cultural infrastructure, support services, and network of expertise. Its growth has reflected shifts in economic power in the late 19th and early 20th century, which led to an influx of art being bought, primarily from Europe, by wealthy US collectors. During the 18th century, Europe and particularly Paris and London, were the key centers for the art trade and Europeans were the main buyers. However, one of the most significant developments in the art market post-1900 was the growth of the importance of US art dealers and collectors. A series of regulatory, political and economic changes in Europe from 1900 started to shift the market towards the US, where economic strength and buyer purchasing power rested. Buyers and sellers were also drawn to the more liberal trading regime in the US, as new taxes and other regulatory deterrents severely impacted the market share of former centers such as Paris. The frequently cited quote by London art dealer Joseph Duveen during the 1920s and 1930s was that Europe had plenty of art and America had plenty of money”. The movement of art through sales to New York, as...