By Anita Choudhrie, Founder of Stellar International Art Foundation
In 2020, the Covid-19 pandemic created a significant period of disruption and economic uncertainty across every echelon of society, and the art sector was no exception. With galleries forced to close their doors, in-person auctions cancelled and international art fairs indefinitely postponed, the art market faced an extremely challenging scenario with many fearing a rapid slowdown in sales.
Despite this alarming backdrop, the industry has proved itself to be extremely resilient and has already started to bounce back this year with a strong performance. In fact, in the first six months of 2021, the average spend on art and antiques among rich investors reached $242,000 – an increase of 42 percent on the previous year.
With figures showing that art market activity is already returning to pre-pandemic levels, I believe 2022 will be an appealing and exciting year to invest in art.
The shift online
As with every other sector, the art world’s plans for digital innovation were significantly accelerated due to Covid-19, achieving in the past 10 months what could have taken over 10 years. Auction houses, fairs and galleries were forced to quickly pivot their operations online and equally, collectors had to embrace online-only sales and virtual exhibitions.
However, along with retaining its established customers, this period of digitisation has brought younger clients and more first-time buyers to the market. In fact, Sotheby’s reported over a third of online buyers were engaging with the auction house for the first time in 2020 – a trend that has remained steadfast throughout this year.
Additionally, the shift online has lowered the barriers to participation for artists, with many now able to set up their own websites, curate their own shows and sell their work directly to customers, without the fees associated with renting a gallery space.
Rather than creating conflict within the market between established and new practices, this digital overhaul has in fact driven market growth and spurred greater interest in the sector, which can only bode well for the future of art as an investment heading into 2022.
Return of in-person events
In 2022 the art world is set to return with a bang, with many of the remaining in-person events that were set to be re-instated this year taking center stage in the global arts calendar.
From prestigious auctions and commercial exhibitions to the return of the Venice Biennale, these events are set to propel forward the positive impact that can be elicited by opening up access to the world of art.
Moreover, during the middle of the pandemic, many auction houses focused on encouraging the online sale of more discreet works, holding the ‘standout pieces’ for when in-person bidding could return. For example, Pablo Picasso’s ‘Femme Assise Pres D’une Fenetre’ sold for $103.4 million in May at Christie’s New York live evening sale – the first sale to exceed the $100 million mark in two years.
With permanent collection acquisitions now back on the table, 2022 will be the prime time for serious investors to keep an eye out for prized works returning to the market. There is also an expectation that individuals have been holding onto funds until they can view art in person again, which will encourage greater market activity next year.
Diversifying investment portfolios
After the economic turmoil of the past 18-months, and now with new concerns emerging amid the rise of the Omicron variant, investors will be looking to diversify their portfolios in 2022.
Whilst the art market isn’t recession proof, it typically acts independently of stocks, bonds and other financial markets, making it an appealing asset class that will retain value over time.
Additionally, the rapid rise of art funds and NFTs (non-fungible tokens) have made investing in art more accessible. For example, art funds allow investors to purchase shares in an artwork, which they can buy and sell far more easily than acquiring and auctioning the piece of artwork itself.
In contrast, NFTs have risen as a new way of buying art that particularly appeals to younger investors. In fact, according to Christie’s, the average age of an NFT buyer is thirty-eight and nearly three quarters of them are new to the art world. With Christie’s already recording $93.2 million worth of NFT sales in the first six months of 2021, this new market is heating up and we expect to see investment in the space accelerate throughout 2022.
It is no secret that the art industry has ongoing systemic issues of inequality that need to be tackled. However, one of the strongest positives that has come from the pandemic, has been the unique collaborations which strive to address this imbalance.
For example, the Stellar International Art Foundation supports women and emerging artists by giving them a platform to display and promote their work, something we feel is incredibly important when the majority of artists displayed in major museums and galleries and the topmost profitable artists continue to be male.
As artists, galleries and organisations have come together to collaborate and support each another during the pandemic, they have demonstrated the dynamism and adaptability of the art ecosystem. It is this innovation that will continue to drive the sector forward through 2022 and create new investment opportunities.
For nearly two years, the narrative around the art market has been dominated by the disruption triggered by the pandemic. However, the sector has also adapted at record pace and shown impressive versatility. I would argue it is these initiatives born out of necessity that have, in fact, set the market on a new, more exciting path which has made the sector ripe for investment in 2022.
The Stellar International Art Foundation
Established in 2008, The Collection has become internationally renowned for its content, coverage and activities around the globe and is a particular champion of female artists and feminist art. Currently the foundation comprises over 600 works dating from the late 19th Century to the present day, including international artists and ranging from sculptures to paintings. It distinguishes on individual talent rather than regions and gives an insight into the cultural viewpoint of individuals with diverse understandings of the world.
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