Finance and  (bad) art go hand in hand
By Safura Rahimi on Thursday, March 27 , 2008 http://www.business24-7.ae/cs/article_show_mainh1_story.aspx?HeadlineID=4563

(even the art market is being infiltrated by the petro dollars

. This is driving prices out of sight and creating a false market. The artists are screened via their countries of origin, religions, and many are not allowed to show at the Dubai Art Fair. I wonder where all the stolen masters are going with prices being in the hundreds of millions?) comments by Allyson Rowen Taylor

  

 The booming art sector that has been predicted to catapult the UAE to a new status as a global cultural centre, is also tipped to front a new corporate art scene here in the region. Experts say the city’s rise as an Asian art capital is fuelling the demand for art from corporations in the region and helping drive the growth of corporate sponsorship of art. Dubai’s estimated $80 million (Dh294m) art industry – predicted to rival London and New York in five to 10 years – has witnessed a major expansion of corporate art collections in the past year.

 “There is a good synergy [in Dubai] between art and business. All the infrastructure is ready and that will allow the business to grow and develop – the art business is a very new business model in the region,” Marwan J bin Beyat, director of art and culture at the Dubai International Financial Centre (DIFC), told Emirates Business.

 According to Beyat, Dubai aims to be in the top five cities in terms of art commerce. “I think Dubai will be one of the key players globally in art and business. In Asia we need to be number one in three to five years – it’s very important for us to be there.”

 The emirate’s rapidly expanding business community is also driving the emergence of serious corporate modern art buyers, Beyat added. “I advise many developers and tourism attractions here in Dubai, as part of their corporate social responsibility, to buy art from galleries and young artists. With that support, the market will definitely go up.”

 The DIFC was one of the first institutions in Dubai to start a corporate art collection, focusing mainly on Middle Eastern artists. Seventy per cent of the 200-piece collection is made up of regional art, and the centre is looking to buy more pieces from Iran, Istanbul and Mumbai. Plans for an Islamic art exhibition during November are also in the works, Beyat said.

 The financial institution signalled a new era for corporate art sponsorship in the region  last year by buying an undisclosed 50 per cent stake in the Art Dubai exhibition (formerly the Gulf Art Fair). The show brought together a record 68  galleries from 28 countries, with serious collectors generating an estimated turnover of more than $15m. As part of the agreement, DIFC plays an integral role in driving Dubai’s position as a global centre for art, while establishing itself as a collector and promoter of regional and international artists alike.

 According to John Martin, director of Art Dubai, there is a lot of tradition attached to investment banks’ and the financial community’s role in collecting art. “They go out of their way to help the art market and the art community in a big way and I think banks have traditionally always done that,” Martin said.

 JPMorgan Chase is currently exhibiting master artworks from its JPMorgan Chase Art Collection for the first time in the Middle East, until May 1, at the DIFC. The collection is one of the oldest and most extensive corporate art collections in the world and features 70 museum-quality modern and contemporary works by leading artists of the 20th century.

 And Credit Suisse launched its international Art & Entrepreneurship exhibition featuring 19 artists from around the world in Dubai last week. The exhibition will be shown in seven other major cities, including New York, Berlin and Moscow, before a London auction on November 24.

 STRATEGIC MOVES

Art Dubai’s Martin says that companies involved in sponsorship and support of the arts can do a huge amount of good and dramatically change the nature and cultural quality of a city.

 “The ethos in Dubai is very much to drive contemporary culture through private partnerships as well; there’s always been a case where people are prepared to take a risk, to involve themselves, and to change the city that way themselves.”

 However he added that it’s easy to make mistakes, too. “For companies, it is terribly important to get sound advice – working with art consultants is very important.”

 DIFC’s Beyat is keen to stress that the extent to which corporate art collections can take off in the region depends on strategy. “Because the art market has high risks, we have to have a plan for that risk. Corporate collections need a proper strategy, which should build on educating people – potential buyers and collectors – about the advantage of having an art collection.

 “The challenge will be to capture the attention of the investors to come and trade in Dubai,” he said.

 The DIFC’s art and culture branch is in touch with corporate art experts from the United Kingdom, Paris and New York, who provide information and advise the centre. “We advise them on the current situation in Dubai’s art market to find out what the best business model for the city is,” said Beyat.

 “We don’t have enough databases or enough art consultants and advisors who really know art, but we incorporate with others from the West and East to gain experience and to develop something that suits our culture and the arts sector in Dubai,” he said, adding that the DIFC is looking at what’s happening in the art markets of India, China and Singapore.

 “Dubai is always looking for another way of doing the business – we don’t copy and paste what’s happening all over the world and we are not imitating other cities. We need something for Dubai that’s tailor-made.”

 THE RIGHT INVESTMENT

 Beyat said the development of corporate patronage in the emirate stems from a marketing strategy, and from the trend of art as an investment. “The main reason [corporations collect art] is to build an image for the company itself and to increase their profile. Most of the wealth companies, as part of their strategy, keep space for art and for their own collections.

 “It’s also a long-term investment,” he added. “Once you collect the artworks it automatically becomes an asset of the company. Nowadays there is a good premium on art so corporate collections can generate 15 to 20 per cent in the short term, which is very good revenue.”

 Lisa K Erf, director of the JPMorgan Chase Art Collection, said the collection began nearly 50 years ago to bring art into the workplace for the enjoyment of employees, clients and guests.

 “The purchase of art for display in our company is a cultural investment in creating a humanising environment for our employees and visitors. It has a strong functional intent in that our collection serves as interior decoration, while sending the message that, as a firm, we value individuality, diversity, and innovation,” she said.

 According to Beyat, it depends on a company’s strategy what it ends up doing. “Some of them would just like to fill their offices, while others look at it from a different angle, which is where they can invest in the art and those collections in 15 to 20 years time.”

  Q&A: Frederic Sicre, Executive Director, Abraaj Capital

  Tell us about the art prize you announced at Art Dubai last week?

 We’re the lead sponsor for the event for the next couple of years and have created the Abraaj Capital Art Prize. It will recognise three artists who will be funded to work on projects to be presented at next year’s fair. This is a new inroad for us into the art world, part of our social corporate responsibility.

 Why take such an active role in supporting Dubai’s art scene?

 It is the belief of the leadership at the firm that Dubai has been a tremendous success story in terms of providing a multicultural environment for people with ideas and from all walks of life to participate in the experience here. But to make that sustainable this multicultural dimension has to grow deeper. The arts are an extraordinary way for different cultures to be able to come together and share a new dimension of tolerance. We see it as contributing to the future sustainability of Dubai’s growth.

 How much are corporate art collections taking off in the region?

 We’ve been waiting for this “renaissance”. I think we’re at the beginning of a process that is going to accelerate quite fast over the next couple of years.

 Why are more corporate leaders here stepping up their involvement in the arts?

 It makes business sense, as with everything the private sector does. Corporate social responsibility is not something that may make an immediate impact on your bottom line but in the long term having societies that are well educated, healthy, and empowered is in the interest of companies. There’s a business case to be made in terms of art, its value and growth over the years.

 Are you looking at more sponsorships?

 In the art scene, never say never. Corporate social responsibility in this part of the world is a growing concept and different companies are evolving with that concept.

The numbers

15-20%: the revenue premium collections can generate short term

70%: regional art in DIFC’s portfolio

$80m: the size of Dubai’s art market

 

Leave a Reply

Looking for something?

Use the form below to search the site:


Still not finding what you're looking for? Drop a comment on a post or contact us so we can take care of it!