Modern love

Art is a tricky investment. You can start with the most collectable names - Payal Uttam presents the top five

PUBLISHED : Monday, 22 April, 2013, 12:00am
UPDATED : Monday, 22 April, 2013, 11:22pm

British guitarist Eric Clapton is one of the world's best examples of why it pays to invest in art.

The purchase of an abstract painting in 2001 for £2 million (HK$23.7 million) paid off hugely for the 68-year-old inductee to the Rock and Roll Hall of Fame, earning a more than 10-fold return when it sold for £21 million at auction in London in October. The work by German artist Gerhard Richter even entered the record books, fetching the highest amount ever paid for a painting by a living artist.

Such records at auction sales are a sign of the buoyant state of the global art market, an asset class that has consistently outpaced inflation over the past decade while also providing diversity in terms of correlation to other asset prices.

The resale value of paintings sold at auction has risen an average 7.8 per cent annually since 2002, according to the Mei Moses World All Art Index. The returns, which factor in a two-year slump in global art prices during the financial crisis, show art outpacing US equities, international equities and US fixed income during the 10-year and 15-year time periods, according to J.P. Morgan.

Art advisers remain upbeat about the prospects for Asian contemporary themes this spring, noting Hong Kong now has the third largest art market by auction sales, behind New York and London.

The trend underscores rapid wealth creation ongoing in Asia, and interest among high-net-worth individuals to chase up artworks and other luxury goods, according to J.P. Morgan.

Hong Kong-based adviser Jehan Chu agrees, saying he expects continuing interest this spring in paintings by emerging Chinese artists as well as in those by the pioneers of China's modern art movement, while works by other regional artists will also find appeal among collectors.

"Asian art is still king," Chu says.


Lee Kit
When Hong Kong-based collector Alan Lo and his wife walked into a gallery to purchase a cloth painting by Lee Kit, they were met with a surprise.

Sitting atop the painting, which lay sprawled on a gallery table, were cellphones, a laptop and other personal belongings of the gallery staff. "It's such a departure from your typical preconception of what art should be," Lo says. One of Hong Kong's most talked-about young artists, Lee is known for his conceptual cloth works, often painted in plaid or stripes, which are used in live performances as actual tablecloths or picnic mats in domestic and exhibition settings before being sold as art.

While it is riskier from an investment perspective to purchase work by emerging artists, curators and gallery owners say Lee is on the brink of international success.

"His work stands out because it's fresh and different," says Lisa Carlson, director, Lombard-Freid Projects, who represent him in New York. "It is very much embedded in an art historical cannon of minimalist and conceptual work so he really has a place." Lee's participation in 2008 in the Guangzhou Triennial, an annual contemporary art exhibition hosted by the Guangdong Museum of Art, brought him into the limelight. Since then he has gone on to exhibit in several major museums. Last May he was awarded the Art Futures Prize, which recognises up-and-coming talent, at the Hong Kong International Art Fair (now known as Art Basel). One month later Lee learned he would represent Hong Kong at the Venice Biennale, a high honour in the local art scene that often leads to price increases in the artist's work.

"Nobody wants to sell Lee Kit's work now that everyone believes higher prices are to come," Chu says.

"We have a hard time keeping [his work] in the gallery and Art Basel was a little manic. People were just going a little wild for it," says Carlson.

Current prices of his work range from US$10,000 to US$20,000.

The works are favoured by collectors who seek out younger, less established artists. "Lee Kit is still at a price point where he is a safe bet," Carlson says.


Zao Wou-ki
A Chinese émigré who settled in Paris in the 1940s, Zao Wou-ki is known for vivid abstract paintings suffused with colour.

Among Zao's most sought-after paintings are his oracle series from the 1950s, a turning point in his career. "We regard this period as very important," Christie's Hong Kong associate specialist Joyce Chan says. "It really marks the original concept of Zao Wou-ki."

The abstract paintings reference an ancient Chinese practice of carving inscriptions on animal bones, which were then used to foretell the future.

Zao died earlier this month at the age of 93, at home in Switzerland.

According to dealer Pascal de Sarthe, Zao's oil paintings currently sell for between US$400,000 and US$10 million. However, in the art world, his death would imply an increase in the value of his works. Prices started to go up for Zao's work in the early 1990s after Taiwanese collector Victor Ma began buying.

"There are two major reasons that consolidate his market value: firstly, he is regarded as a pioneer of Chinese abstract painting and secondly, he entered into the Western mainstream art market at a very early time in the 1950s," Chan says.

According to experts, Zao is increasingly being recognised for his contributions to the modern art movement in China. "He is an integral part of Chinese modern art history. He had a great influence on art movements in China and art education so there is every reason for him to be recognised," Hanart TZ Gallery curator and director Johnson Chang Tsong-zung says.


Yayoi Kusama
"Everybody is talking about Kusama," art adviser Jonathan Crockett says.

One of Japan's most famous living artists, 84-year-old Yayoi Kusama is known for her paintings, installations and sculptures with obsessive polka dot patterns.

Something of a renaissance woman, Kusama moved to New York in the 1950s where she experimented with performance, installation, sculpture and painting.

"In the 1980s and all throughout the 1990s her prices were still very reasonable, in the hundreds of thousands [of US dollars]," art adviser Mathieu Ticolat says.

Prices for her work began to rise sharply in 2002, according to Ticolat. "Her first commercial breakthrough came in 2008 when she set the world record at Christie's for a living woman artist," Ticolat says. Fetching US$5.8 million, the white painting is titled No. 2 and is part of her Infinity Net series. It remains her highest selling work today. At Christie's New York contemporary art sale in March, two of Kusama's works sold for US$18,750 and US$30,000.

In 2011, she had a major retrospective at the Centre Pompidou in Paris followed by retrospectives at the Whitney Museum of American Art and Tate Modern last year. "People feel more comfortable when a pedigree is established, that an artist is in all the major museums and they are in the best collections," Ticolat says.

"She is in her 80s, even her late work will go up in value because she is one of the last major living female artists," he adds.

Last year, Kusama partnered with the luxury brand Louis Vuitton to create a collection of accessories and clothing further raising her profile among collectors.

Asked why she was attracted to Kusama's work, collector Kyoko Tamura says: "She is very individualistic. She doesn't belong to any Japanese art movements. Her works are in a way spiritual and timeless."

Kusama's older works are in high demand. Tamura says she is looking out for her Infinity Net paintings from the 1960s.

"I am looking as well," says Lo, who is interested in works from the 1980s. "But in the long run, obviously, they will be harder and harder to find."


Wu Guanzhong
Wu Guanzhong is a giant of 20th-century Chinese art. Born in 1919, he began his career with oil painting, spending time in Paris in the 1940s before returning to China after the Cultural Revolution.

The 1970s was a major turning point for Wu. He began concentrating on the traditional medium of ink, an unusual move at a time when many artists looked to the West for inspiration. Pushing the boundaries of the medium, he experimented with bright colours and unconventional subject matter like architecture.

"He is considered a historical modern who works within the medium of Chinese ink painting but who has a fresh personal touch," Hanart TZ Gallery's Chang says. "Of course there are many people who experiment but he is a pioneer who led the way in China."

"Wu Guanzhong is valuable because he is seen as one of the masters of a particular generation of ink painting," art adviser Chu says. "He has a revolutionary style."

Hong Kong collectors took a keen interest in Wu's work in the 1980s. "Prices have settled down in the last couple of years but they have now hit the roof because he died," says Chang of Hanart TZ Gallery. Wu died in 2010, aged 90.

At Sotheby's Hong Kong autumn sale in 2011, his top-selling ink painting went for US$3.7 million. Wu's smaller ink works start at about US$10,000.


Liu Wei
"It's a breath of fresh air," says Lo, the Hong Kong collector, when comparing Chinese artist Liu Wei's work to previous generations of contemporary Chinese painters.

Working across several mediums, the 41-year-old artist's works range from oil paintings and photography to large-scale installations made from everyday objects including books and refrigerators.

"A lot of collectors are looking for the next generation of successful artists from China and I think he represents that," art adviser Chu says. "His work doesn't echo any of the post-revolution imagery that people are tired of." "He really has a different world view and he isn't only thinking about China," Christie's Chan says.

According to Courtney Plummer, partner of Lehmann Maupin, Liu also stands apart because "he deals with global issues that transcend his own geo-politics and generation while still being focused on technical excellence and skill."

Chu says many collectors are attracted to the aesthetics of his work because "it doesn't look like anyone else's art."

Among his most recognised bodies of work has been the Purple Air series. "This is really what propelled him to the consciousness of collectors," Chu says. Started in the mid-2000s, the series of paintings are composed of circuit board-like lines that suggest densely packed cityscapes.

"He touches upon social political issues and articulates it in a way that is mesmerising," Hanart TZ Gallery's Chang says.

Prices for Wei's paintings or sculptures range from US$50,000 to US$250,000.