Art takes podium place in lux­ury in­dex

Financial Chronicle - - DEEP DIVE -

At the be­gin­ning of 2018, art had surged to the front of the Knight Frank Lux­ury In­vest­ment In­dex (KFLII), which tracks the per­for­mance of ten lux­ury as­set classes. Six months on, it is hold­ing its own, with an­nual growth of 25 per cent to the end of June.

Given the US$450 mil­lion sale of Leonardo da Vinci’s Salvator Mundi last year, it is un­likely that we will see a new record price for a paint­ing any time soon. How­ever, in May, Sotheby’s did set a new com­pany bench­mark with an im­pres­sive US$157 mil­lion for Amedeo Modigliani’s sump­tu­ous Nu couché (sur le côté gauche).

Delv­ing be­yond the 25 per cent head­line fig­ure – based on anal­y­sis of auc­tion prices by Art Mar­ket Re­search (AMR) – it’s clear that not ev­ery genre is mov­ing at the same pace. Con­tem­po­rary art, for ex­am­ple, recorded a slight drop, while the mar­ket for Old Masters is mak­ing some­thing of a come­back, with av­er­age prices ris­ing by 24% over the past year.

“Since Salvator Mundi was con­firmed as a lost mas­ter­piece by Leonardo da Vinci, auc­tion houses such as Christie’s in Lon­don, Dorotheum in Aus­tria, Pan­dolfini in Italy and Lem­pertz in Ger­many have been em­brac­ing unattributed Old Master paint­ings,” ex­plains AMR’s Veronika Lukasova.

“Unattributed works that are con­nected with stel­lar name artists, for ex­am­ple, ‘Fol­lower of Canaletto’, can reg­u­larly achieve higher prices than some firmly at­tributed works by lesser artists. The uptick is un­doubt­edly hav­ing a knock-on ef­fect across the whole Old Master mar­ket.”

Wine re­mains in sec­ond place in the rank­ings, with the Knight Frank Fine Wine Icons In­dex, com­piled by Wine Own­ers, record­ing an­nual growth of 7 per cent. “This year has been about con­sol­i­da­tion,” says Wine Own­ers’ Nick Martin. “Some of the more

ex­pen­sive, older vin­tages are com­ing off their peaks, while oth­ers power ahead. Bur­gundy con­tin­ues to defy grav­ity as it adds an­other 14 per cent in the year to date, com­pared with Bordeaux first growths at less than 3 per cent over­all. Over three years, Bur­gundy has risen 85 per cent com­pared with 45 per cent for first growths.”

Fol­low­ing a shaky start to 2018, clas­sic cars have raced back to take third place in the KFLII. An­nual growth at the end of Q2 2018 stood at a re­spectable 6 per cent, ac­cord­ing to the HAGI Top In­dex. How­ever, H AGI’s Di­et­rich Hat­lapa cau­tions against as­sump­tions that this presages the be­gin­ning of an­other clas­sic car bull run. “The mar­ket is still very cau­tious,” he says.

Re­ally rare cars are still mak­ing good money, though. A Fer­rari 250 GTO, sold pri­vately re­cently, is re­ported to have made US$70 mil­lion, while RM Sotheby’s set a record for the most ex­pen­sive car to sell at auc­tion when it sold an­other 250 GTO (pic­tured) for $US48.4 mil­lion at the re­cent Mon­terey sales.

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