Art First Responsder

The Chubb Collector recently came out and one of the interesting articles was about hurricane Sandy, and art first responders. The article is written by a Crozier Fine Art project manager.  According to the Crozier website, they are a museum-quality storage, transportation and fine art engineering services. According to the Chubb article, Crozier removed more than 3000 pieces of art from storm damaged areas. The pieces of art were moved into a 10,000 square foot facility where the artworks were inspected and action plans developed for conservation, storage and return to collectors.

Chubb Collector reports

Requests for assistance started coming to us almost immediately. Several clients approached us as we stood outside our headquarters. Others were able to connect through undisrupted personal email accounts and voicemails. We also had a team walking up and down 10th and 11th avenues, from 19th street up to 26th, checking in on our existing clients and any others who might need a hand. The spectrum of assistance ranged from “Hey, can we borrow a flashlight and some gloves?” to needing full-scale collections removal and immediate stabilization. Each big request that came in was followed by a site visit by a Crozier Emergency Project Manager, where necessary documents were signed and the scope of work and conditions on site were assessed.

The extent of damage was staggering. With evidence of a chest-level storm surge in some areas and other areas strewn with debris, Chelsea looked more like a disaster zone than the heart of New York City's art scene. Our crews were dispatched using walkie-talkies to communicate; cell phones still were not working. Our managers walked from location to location, checking job progress and delivering necessary materials. Client managers took on the role of field registrars to manage the volume of inventory that we were removing. There was nothing to eat or drink below 34th street, so in addition to overseeing operations, senior management drove to mid-town to buy food and water for the crews. Everybody pulled together to get the job done.

Projects continued through the week with staff meeting every morning in our still-unlit reception area to receive assignments and hand-written paperwork for the day. With no power or lights throughout the lower half of Manhattan, crews could only work until 4 p.m. if they were to get home safely before dark.

In a matter of days, we removed roughly 3,000 works of art from galleries, residences and commercial buildings, each suffering varying degrees of water exposure. They were delivered to our New Jersey facility where we had readied a 10,000 square foot triage space so that the work could be placed in clean, stable temporary storage.

Source: Chubb Collector 

Like Kind Exchanges

Aris, the Art title insurance brokerage recently sent out an alert and connected article on Like kind changes to defer gains on artworks.  The exchange, should it meets all of the IRS regulations allows the collector to sell an artwork and buy another and defer the taxable gains.  This is important to high end collectors where art has been appreciated and  tax rates can reach above 30%.

This information fall more into the accounting category rather than appraisal and valuation  but it is also good information to know about and be familiar with.

Aris reports

TRUST & ESTATES - Like-kind IRC 1031 exchanges allow art investors to defer tax gain recognition on the sale of artworks, which is especially attractive now because art prices continue to climb and taxes on art sales can have a combined federal rate up to 31.8 percent. To secure 1031 tax benefits, taxpayers must satisfy several strict requirements including proving that the replacement and relinquished property are like-kind and among other factors used in the same place, that is, inside or outside of the United States (see also ARIS news October 5, 2011).

[ARIS Commentary: Taxpayers, qualified intermediaries and financial or legal advisors involved in like-kind exchanges of fine art and important collectibles should be cognizant of the significant consequences and risks of unwinding 1031 exchanges. Because of the opaque and global nature of the art market, in which undisclosed principals with different nationalities transact multi-million dollar deals, exchanges can unwind due not only to investors lacking clear legal title but also to the replacement or relinquished property being "used" in different locations. Title insurance can help to establish that artworks are like-kind through title insurer-certification of location of subject property for purpose of "predominant use" inside or outside of the United States without impacting the transacting parties' desires to preserve their confidentiality.]

Source: Aris & article on Like Kind Exchanges

Technology and the Arts

AW partner Jane Brennom sent me an interesting article about the collaborative efforts between the Chicago Art Institute and the engineering school at Northwestern. The joint project is now offering services to museums across the country and has recently obtained a $2.5 million grant from the Mellon foundation to promote the initiative.

Some of the discoveries and processes used are pretty amazing, and can certainly assist in conservation and authentication efforts.

Since the start of the joint program, the collaboration has discovered the following:

• Bathers by a River by Henri Matisse. (Charles H. and Mary F. S. Worcester Collection, 1953.158.) Imaging technology developed by the Department of Electrical Engineering and Computer Science was used to colorize archival black-and-white photographs of the painting’s early versions, providing insights into Matisse’s working methods and the development of this masterpiece over time.

• For to Be a Farmer’s Boy by Winslow Homer. (Gift of Mrs. George T. Langhorne in memory of Edward Carson Waller, 1963.760.) Conservators discovered that the painting’s sky was originally painted in unstable red and orange colorants that have almost completely faded. Work by a team of Northwestern chemists to determine the original colors was included in the 2008 exhibition Watercolors by Winslow Homer: The Color of Light.

• Sketch of Margaret Sloane (see image), Looking Right by Mary Cassatt. (Gift of Laura May Ripley, 1992.158.) A research team removed tiny colored specks from this pastel study and examined them using a highly sensitive technique called surface-enhanced Raman spectroscopy. Researchers were able to detect and identify organic pigments that could be matched to pastel sticks in Cassatt’s paint box.

• A Sunday on La Grande Jatte—1884 by Georges Seurat. (Helen Birch Bartlett Memorial Collection, 1926.224.) The luminous yellow began to change within years of Seurat’s completing the painting, but no one knew why. Scientists determined that exposure to a humid climate and burning coal caused the darkening of the zinc yellow pigment Seurat used.

• Head of a Woman (Fernande) by Pablo Picasso. (Estate of Pablo Picasso/ Artists Rights Society [ARS], New York.) The Art Institute’s current Picasso and Chicago show includes a study analyzing the metal alloys of modern sculptures. Having determined that many of the Picasso sculptures are made of high-zinc brass alloys, a research team was able to trace many of the unmarked works to the Valsuani foundry in Paris. Fernande is different; it has a low-zinc bronze composition more typical of sand-cast sculptures. The search for its unknown casting foundry is one of the open questions the new Center for Scientific Studies in the Arts hopes to address by broadening the alloy research to collections in other museums.

The McCormick Northwestern Magazine reports

While staff at the Art Institute explore engineering methods that may enhance conservation and art history, researchers at Northwestern learn about critical problems in conservation science. “The entire University benefits by being engaged with one of the finest art museums in the country,” Faber says, “and it’s good for students to see how they can use their technical backgrounds to work on atypical problems.”

Arts-related research has also sparked findings in other, unintended areas of study. In one ongoing project Faber; Kenneth Shull, professor of materials science and engineering; and Linda Broadbelt, Sarah Rebecca Roland Professor of Chemical and Biological Engineering, have been studying the composition of house paints Picasso used in some of his works. The three are developing tests to understand the physical and mechanical properties of a similar paint system: an indentation test, which involves pressing on the paint to test its response, and a “quartz resonator” test, in which researchers coat paint onto a vibrating piece of quartz to analyze its nanoscale structure. If paint samples that behave like Picasso’s house paints can be developed, they can be used to test methods for cleaning the artwork.

The research has led to unexpected discoveries. “The focus is on paint, but there is an opportunity here to develop characterization methods for a variety of protective coatings and to learn how they degrade,” says Shull. “These oilbased materials, which are important to the art community, are also sustainable materials that could have tremendous value elsewhere.” Shull is currently investigating the application of the techniques in creating dental fillings.

For the Art Institute’s current Picasso and Chicago show (through May 12), researchers traced some of Picasso’s modern bronze sculptures to a specific foundry in Paris by using emission spectroscopy and x-ray fluorescence to determine the chemical composition. The researchers included David Dunand, the James N. and Margie M. Krebs Professor of Materials Science and Engineering.

Since the Northwestern–Art Institute collaboration began, the partnership has been supported by the Mellon Foundation with additional grant support from the National Science Foundation. In January the Mellon Foundation announced the sizable grant to establish NU-ACCESS for six years. Casadio and Faber direct the center, which serves as a collaborative hub, facilitating interdisciplinary research partnerships in art studies and conservation on a national scale.

Museums and cultural institutions will be asked to submit proposals for the study of objects in their own collections or for object-inspired research. Faber and Casadio expect three to five major projects and up to 10 minor projects to be carried out each year.

Source: McCormick Northwerstern Magazine

$1.5 Billion in Art Sales

Bloomberg has totaled the Christie's and Sotehby's evening and day sales, as well as the Phillips sale for the Impressionist, modern, postwar and contemporary auction and the figure totaled  nearly $1.5 billion.  That is about $200 million above pres sale estimates. It has been a good couple of weeks for the NY auctions.  It will be interesting to see some of the financial analysis and returns generated by the sales when released by art analytic groups such as Mei Moses.  I always enjoy seeing what the press and trade have to say about the sales versus the financial analysis and actual returns being generated.

The Phillips sale had 37 lots with 30 selling for a sell through rate of 81%, and the sale totaled $78.6 million including buyers premiums.  The top lot was Andy Warhol’s 1962 silkscreen painting “Four Marilyns” (see image) sold for $38.2 against an estimate of $35 million to $50 million (later dropped to $45 million).

Bloomberg reports on the sales

All told, the Impressionist, modern, postwar and contemporary auctions (both evening and day) at Christie’s, Sotheby’s (BID) and Phillips totaled about $1.5 billion this month, exceeding the expected target of $1.3 billion.

Christie’s won this round of sales, raising $638.6 million in its postwar and contemporary sales and $190.3 million for the Impressionist and modern auction. Sotheby’s tally for all sales was $665.7 million. The Phillips day sale continues today.

Seven of the 37 lots at Phillips last night failed to find buyers. A dozen lots were guaranteed to sell by Phillips, a third party or a combination thereof.

“The sale was measured,” said New York art adviser Mary Hoeveler. “People spent a lot of money in the preceding auctions.”

Christie’s recorded the highest auction tally in history the night before with $495 million and set 12 artist records, including milestones for Jackson Pollock, Roy Lichtenstein and Jean-Michel Basquiat.

Earlier in the week, Sotheby’s sold about $300 million of art, establishing records for Barnett Newman and Gerhard Richter.

Source: Bloomberg

Results: Christie's NY Post War and Contemporary Art Evening Sale

The Wednesday evening sale broke all sorts of records, perhaps none so amazing as setting the highest total at auction, ever. The Christie's sale totaled nearly a half billion dollars.

The sale offered 70 works of art with 66 selling for a strong 94% sell through rate.  The sale totaled $495.02 million including buyers premiums, selling 94% by value.  The sale went well beyond the pre-sale estimates of $288.9 to $401.4 million.  9 lots sold for over $10 million. A few other items of note beyond the auction record, 59 of the 66 lots sold above one million, 23 lots topped $5 million.

The top selling lot was by Jacksopn Pollack, Number 19 an oil and enamel on paper mounted on canvas painted in 1948, it sold for $58.36 million including buyers premium (see image), a record for the artist at auction..  The pre-sale estimate was $25-$35 million. The Pollock was closely followed by  Roy Lichtenstein's Woman with Flowered hat from 1963 which sold for $56.12 million.

Christie's reported on the sale

RELEASE: MAY 2013 POST-WAR AND CONTEMPORARY ART EVENING SALE

MAY 2013 POST-WAR AND CONTEMPORARY ART EVENING SALE ACHIEVED $495 MILLION

HIGHEST TOTAL IN AUCTION HISTORY

Christie’s auctioneer Jussi Pylkkanen, hammers down Jackson Pollock’s Number 19, 1948,which achieved the highest price for the artist at $58.3 million

POLLOCK’S NUMBER 19, 1948, SOLD FOR $58M (£38.5M / €45.5M)

A WORLD AUCTION RECORD FOR THE ARTIST

LICHTENSTEIN’S WOMAN WITH FLOWERED HAT REALIZED $56M (£37M / €43M)A WORLD AUCTION RECORD FOR THE ARTIST

DUSTHEADS FETCHED $48.8M (£32M / €38M), SETTING A NEW WORLD AUCTION RECORD FOR BASQUIAT

GUSTON’S TO FELLINI, ACHIEVED $25.8 (£17M / €20)WORLD AUCTION RECORD FOR THE ARTIST

STRONG INTERNATIONAL DEMAND FOR MASTERPIECES AND WORKS FROM PRESTIGIOUS PROVENANCE

16 NEW ARTIST RECORDS SET

3 WORKS SOLD ABOVE $40 MILLION, 9 ABOVE $10 MILLION, AND 59 ABOVE $1 MILLION

New York – On May 15th Christie’s Post-War and Contemporary Art evening sale achieved a staggering  $495,021,500 (£326,714,190/ €386,116,770), with a remarkably strong sell-through rate of 94% by value and by lot.  Bidders from around the world competed for an exceptional array of Abstract Expressionist, Pop and Contemporary works from some of the century’s most inspiring and influential artists, including Jackson Pollock, Roy Lichtenstein and Jean-Michel Basquiat. The sale featured a range of superlative works from distinguished private collections and institutions, such as the Collection of Celeste and Armand Bartos and the Estate of Andy Williams. The sale established 16 new world auction records, selling 9 works for over $10 million, 23 for over $5 million and 59 for over $1 million.

“We are thrilled to announce an extraordinary total of $495 million for this evening’s sale of Post-War and Contemporary Art – the highest total in auction history. The remarkable bidding and record prices set reflect a new era in the art market, wherein seasoned collectors and new bidders compete at the highest level within a global market. Our sale was heavily focused on masterpieces and collections, achieving an astonishing 16 record prices. With Monday’s blockbuster charity sale, The 11th Hour Auction, our sales total exceeds a half a billion, raising $528.3 million,” said Brett Gorvy, Chairman and International Head of Post-War and Contemporary Art.

Source: Christie's

Results: Sotheby's NY Contemporary Art Evening Sale

Sotheby's NY Contemporary Art evening sale had some mixed results.  While some of the sales where high along with some artist auction records being set, there were also some big misses.

The sale offered 64 lots with 53 selling for a 82.8% sell through rate.  The sale totaled $293.59 million including buyers premiums, against a pre sale range of $283.95 million to $382.9 million. The sale sold 82.4% by value.  All of the sales figures are just OK, and pretty much fall within what was expected, although given the pre sale estimate, the sale was nearly $90 million off from the high mark.

The top selling lot was Onement VI by Barnett Newman (from Paul Allen's collection) and sold for $43.85 million against a pre sale estimate of $30/$40 million (see image). This was an auction record for the artist.  From the top 11 sales, 6 sold over the high estimate, 2 sold under the low estimate, two between the estimates and one had the estimate by request.

Two big misses were a Francis Bacon portrait estimated at $30 million to $40 million and a sculpture of four vacuum cleaners by Jeff Koons at $10 million to $15 million.  Both failed to sell.

Sotheby's reported on the sale

NEW YORK, 14 May 2013: Tonight at Sotheby’s the Contemporary Art Evening sale totaled $293,587,000, and was 82.8% sold-by-lot. There were exceptional prices for works from every decade from the 1940s through today with records set for Barnett Newman and Gerhard Richter, among others. The price achieved for Richter’s masterwork also established a new benchmark for any living artist at auction. The global nature of today’s art market was yet again underlined with collectors from 35 countries registering to bid in the sale, 20% of whom were new to either Sotheby’s or the category.

Tobias Meyer, Worldwide Head of Contemporary Art at Sotheby’s, said: “This evening we are very pleased to have achieved three landmark prices for masterpieces by key post-war artists. Barnett Newman’s Onement VI established a world record for the artist at auction and doubled the world record price achieved just one year ago. Gerhard Richter’s Domplatz, Mailand set a record for a living artist at a price which was a triumph for a photo-painting by the artist, and Yves Klein’s exquisite sculpture set a medium record for the artist.”

Alexander Rotter, Head of Sotheby’s Contemporary Art department in New York, noted: “Tonight we offered important works spanning 70 years, and witnessed strong demand across that impressive range – from early works by Pollock and Calder from the 1940s to works by Currin and Colen made just last year. We are delighted with the results achieved for the works sold to benefit the Whitney Museum of American Art’s new building project, which nearly doubled the high estimate to realize a total of $11.8 million, with 17 more works to be offered tomorrow.”

Damage from Sandy Still Having an Impact

I have posted in the past on the amount of damage done by hurricane Sandy also including insurance claims, gallery damage and the increased work loads of appraisers and conservators.  The NY Times recently ran an article that the effects of the storm are still being felt by collectors as well as insurance agents, conservators, appraisers and collectors.  I think the damage, as well as the amount of press, and type of press, such as the need for appraisals and art insurance has been rather positive and increased the awareness of allied professionals within the art world.

The NY Times reports

Across the tristate area, dripping, silt-streaked canvases from galleries had to be parceled out to dry in warehouses in New Jersey and Long Island City, and corralled to contain mold spawned by moisture.

Appraisals had to be drawn up. Restoration costs estimated. Insurance adjustments made.

In cases in which the works’ artists are living, they have to be consulted on repairs. Under a federal law known as the Visual Artists Rights Act, artists retain the right to disapprove any proposed alteration or destruction of their paintings, drawings, prints, sculptures or still photographs, even after they’ve been sold.

And in cases where the works could not be restored, when the insurance company decided they were indeed “totaled,” the paintings had to be discarded in a formal process that was photographed to protect against a work’s resurfacing years later.

More than six months after Sandy, many of the efforts to save artworks are continuing. In Ms. Pitha’s case, on the advice of a family friend she took the Cassatt and 18 other works to conservators at Alvarez Fine Art Services, a midtown company that was, like its peers, racing to keep pace with its client load after the storm.

Alvarez specializes in the conservation of works on paper. When Ms. Pitha’s works were delivered, the company separated those that had gotten wet from those that had stayed dry and assessed the damage, explained Scott Krawitz, who opened the business 30 years ago with Antonio Alvarez.

Conservators at Alvarez prepared a condition report and financial estimate. Ms. Pitha, trusting that her insurer, Champion International Moving, would later provide coverage, signed off on the repair plan and the Cassatt etching was removed from its frame and glass. When the matting was removed, the storm’s watermark and a brown stain could be seen around the perimeter of the image, Mr. Krawitz said.

Jason Marquis, studio manager for Alvarez, said after the Cassatt was cleaned, it was placed on a series of cotton rag paper blotters under weighted glass to remove as much moisture as possible.

Then the stability of the etching’s ink was tested. Mild chemicals were applied and rinsed away to diminish the stain, remove traces of acid from the paper and return it to its original tone, Mr. Krawitz said.

The ways art can be spoiled range from the tragic, like a house fire, to the humorous.

Victor Wiener, an independent art appraiser, remembers a housekeeper who tried to “dry off” a rain-spattered multimillion-dollar canvas with a cleaning rag and smeared the image in the process. Simon Hornby, president of art services for Crozier Fine Arts described cases in which aquariums collapsed and bathtubs overflowed, causing harm.

Source: The NY Times