ARTS & CULTURE
Overview of the Top 5 Art Advisors in the world
Heller advises Roman Abramovich and Hedge Fund Manager Steven Cohen. In 2013, he helped Cohen buy Picassos’ Le Rêve (1932) for £99,000,000.
Schwartzman was a founding member of the New Museum of Contemporary Art in New York, then Director of New York’s Barbara Gladstone Gallery. Recently, he co-founded Art Agency Partners.
Zlot set up Mary Zlot & Associates in 1983. She has developed a collection for the San Francisco Museum of Modern Art and has investment Firms Charles Schwab & Co. and Kohlberg Kravis Roberts & Co. as clients.
With her husband Ethan Wagner, Westreich has advised collectors Norah and Norman Stone and Venture Capitalist Richard Kramlich. The advisors plan to donate most of their huge art collection to the Whitney Museum of American Art and the Pompidou Centre.
A graduate of the University of Michigan, where he studied Art History, Levin worked at Sotheby’s for five years before becoming an independent art advisor.
Private jets, super yachts and palatial homes have long been the hallmark of success. Now contemporary art is also part of the luxury panoply. The figures speak for themselves; in 2015 a record £3.9bn of post-war and contemporary art was sold at auctions alone. Dealers and Auction Houses are the natural beneficiaries of this growth. Yet so are art advisors. As new fortunes sprout each day, art consultant and curators are called in to help with art portfolios.
“There are more serious collectors of serious artists at very high prices than ever before” says Allan Schwartzman, an art advisor whose clients include Dallas-based former hedge fund manager, Howard Rachofsky, and Brazilian mining magnet, Bernardo Paz. Schwartzman added. “Advisors are needed, because it is harder to find great things, because the rate of transactions is much more rapid, and because collectors are paying as much attention as professionals in the field to what artworks are available for purchase. Not surprisingly, the profession is in expansion mode, says Gordon VeneKlasen, Director of the Michael Werner in New York, “I get around twenty-five emails a day and they are all from advisors”. He says he has come across some who know “maybe slightly more than the person they are representing”.
These unqualified upstarts are not going unnoticed. “When the art market becomes extremely strong, people with little experience print up business cards that say ‘art advisor’ as there are no specific credentials required. There is no degree track or educational accreditation”, says New York based advisor Todd Levin, who advised hedge fund manager Adam Sender, for eleven years, and was an under bidder on a FrancisBaconsoldat£85matChristies in November 2013. “It is like the Wild West - when an inexperienced, unethical or unknowledgeable art advisor operates, it reflects poorly on the true professionals in the field”.
The most common practice among art advisors is taking payment from both sides. They collect a fee or commission from the buyer (ranging from five to twenty per cent of the artwork price), then get an agreed fee from the dealer. A London based couple are currently suing long-time advisors for receiving undisclosed commissions for buying and selling art on their behalf. Another practice is helping a client pay less tax than is owed. In 2006, L. Dennis Kozlowski, former Chairman of Tyco International, agreed to pay £2.6m in sales tax and interest after being indicted for non-payment of New York sales tax on art purchases he made through an advisor. In addition, unprofessional art advisors hurt their clients by influencing them to buy bad art - that’s if they have clients to begin with. Some pretend they represent big collectors, ask a dealer for an image of an artwork, and then shop it around in the hope of finding a buyer, eroding the work’s rarity value.
Ideally, an art advisor should show the client art, teach them about the artists, point out the best work, and negotiate with the dealer on their behalf – first to get offered a piece, then to get the right price. Most importantly, the advisors offer access to something money cannot buy: the world’s top art galleries, who pick and choose to whoom they sell their best work. Museums are their top choice, followed by private collectors with established collections. “We are guarding the integrity of the artists and the careers that we are building”, explains VeneKlasen. “As primary dealers, art galleries tend to charge less than what the works can later fetch on the secondary market or at an auction. They are wary of buyers who quickly sell the work to make a short-term gain - and of their advisors.”
A century ago they sought works that would subsequently qualify as masterpieces. Today they want works that will rise in price. “Money is now an increasingly prevalent element within the transaction of art”, says Schwartzman.
Todd Levin tracks this trend back to the mid-Eighties when Citibank started an art advisory department. “Since then, art has taken up the appearance of an nvestment or asset, something that can be quantified as such”, he says, “even though it really can’t be. With money being a bigger part of the equation than before, the responsibility of the adviser is greater too. Collectors are increasingly dedicating larger portions of their net worth towards art”, says Levin. “I have to think in different terms for a collector of this type, as opposed to somebody buying a couple of nice pieces of art to decorate their home.”
One thing that all experienced advisors agree on is this: art buyers who are in it for the long haul stand to benefit most. Notes Schwartzman, “Every collector I work with, whose main goal is to collect art well, not to invest their money well, has done better with their art investments than in other businesses.” Provided, of course, that they choose the right adviser in the first place.