Chinese Collectors of Contemporary Art

The Wall Street Journal just ran a good article on collectors of contemporary Chinese art.  The article touches on not only the art, but the collectors and the mind set of these new collectors.

The article points out that three of the top ten selling items at auction in 2011 were Chinese art.  The collectors are looking for transformative art, and as most appraisers are aware, they are willing to pay for it.  The WSJ article notes that Christie's saw Chinese buyers account for 1/5 of worldwide sales in the first half of 2011, and Sotheby's noted Asian sales were up 47% from 2010, at $960 million.  Although there is concern that the growth will slow due to concerns over the global economy, as well as potential slowing growth in China.

The Wall Street Journal reports

Alan Lee, who runs Beijing gallery Asia Art Center, says one of his clients, a fitness-equipment manufacturer named Chang Chiu Dun, calls himself the "Cover Killer" because he "likes to buy artworks that have been on the covers of auction catalogs."

The downside, Mr. Lee says, is that this influx of newly wealthy collectors is fueling risky speculation on art, leading to price swings and heavy trading volumes for younger artists like the eyeball painter, Ji Dachun, whose lasting significance is still uncertain. Art advisory firm Artvest says Chinese investors have recently started at least eight art funds, which buy artworks with the aim of reselling them at a profit later. There are only about 20 similar funds elsewhere in the world.

China's gallery scene is similarly freewheeling, with collectors such as Mr. Yang sometimes serving as stakeholders or co-owners of galleries where they also shop. Such arrangements can spark potential conflicts of interest because the stakeholders might be able to leverage their position to claim the gallery's choicest pieces. Seven years ago Mr. Yang paid to help his wife open her contemporary art gallery, Aye, but he says he doesn't manage her artists or get first dibs on any work she shows there. He recently stepped back as a financing partner in another contemporary art gallery he founded three years ago, Eastation, in order to focus on his wine venture. He continues to buy art from both galleries.

Dealers and artists say it's unclear whether Mr. Yang is trying to build a museum-worthy collection or angling for the right moment to cash out. "China's market is still so new—it's hard for us to tell who's a collector and who's a speculator," says artist Zhang Xiaogang.

Mr. Yang isn't troubled by such ambiguity. "I can't say if investing in art is good or bad," he says, "but I know that without money, you can't make a market grow."

Within China's contemporary art circles, Mr. Yang is hard to miss. He's tall, with a square face and thick head of black hair. He shows acquaintances cellphone images of his art the way others pull up snapshots of their children. More often than not, he turns up at black-tie dinners dressed in a polo shirt, black corduroys, and sneakers.

Source Wall Street Journal:  To read the full WSJ article, click HERE.