Contemporary Art Reaching 2007/2008 Peak Levels

Bloomberg has an article with an interview of hedge fund manager and art collector Howard Rachofsky. Rachofsky has pledged most of his collection to the Dallas Museum of Art and is considered one of the main players in contemporary art collecting.

The article and Rachofsky briefly touches on many areas of fine art collection, including the current state of the market being close to its past peak in 2007 to mid 2008, as well as major collectors looking for alternative sources to invest in due to the current work economic issues.  There is concern that if world economies continue to suffer, that there will in fact be price deflation in the fine art sectors.

Rachofsky is also concerned there might be too many fairs over the course of a year, and if the trend continues, it could dilute the market.

The Bloomberg article states

The market for contemporary art is more resilient than it was three years ago, according to Dallas- based collector Howard Rachofsky.
The former hedge fund manager, who with his wife Cindy is one of the art world’s best-known buyers, spoke after auctions showed some contemporary prices returning to their peak levels, defying nervousness in the wider economy.

“There’s so much wealth in the world looking for alternative assets,” said Rachofsky. “The market is broader than it was. It’s grown with new buyers from Asia, Eastern Europe and the Middle East. A number of players have come in from the financial industry and they look for value.”

Wealthy individuals are investing in contemporary works as a hedge against economic uncertainty, dealers said. Sotheby’s and Christie’s International’s June series of contemporary art auctions in London raised 220.6 million pounds ($352 million), the second-highest total ever for the U.K. capital.

Still, the market isn’t fully back to the boom levels of 2007 and mid-2008, Rachofsky, 67, said in a telephone interview.

“Some prices are high and comparable to former values,” he said. “It’s not universal. There isn’t a mania out there. If the financial markets go into crisis, there will be deflation in art as well. There will be a pause.”
Dealers at last month’s Art Basel fair in Switzerland reported plentiful sales in the $200,000 to $2 million range. Buyers spent a record 108.8 million pounds at Sotheby’s on June 29, when the little-known Duerckheim collection of 1960s and ‘70s German art fetched 60.4 million pounds, double the estimate.

Click HERE to read the full article.

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