The bustle that descends each summer into a swanky Basel showroom, where collectors shop for art and seek out new talent, will likely be replaced this year by lines of socially estranged Swiss awaiting COVID-19 vaccinations.
The Herzog & de Meuron building usually hosts one of the largest art fairs in the world in June, but last year’s event was canceled due to the pandemic and this year it was moved to September. Meanwhile, the adjoining congress center has been turned into a vaccination center.
The art world is reeling from the impact of closures, travel bans, and social distancing, and fairs like Art Basel suffered more than most. The business of buying and selling art has to adapt to limit the damage.
Global art sales fell 22% in 2020 to $ 50.1 billion, UBS and Art Basel Art Market Report released Tuesday showed the steepest market decline since the financial crisis.
But the picture was mixed, as the purchases of the ultra-rich, especially from Asia, were maintained.
In contrast to the financial crisis of 2007-2009, when many of the world’s rich lost money, the super-rich became richer during the pandemic as financial stimulus and market volatility served to increase their fortunes.
The large auction houses, led by Sotheby’s and Christie’s, were already used to phone deals and online sales, so they could rotate relatively easily to attract cash-rich customers.
Both reported an overall decline, but posted record online activity and resistance among Asian shoppers, while pre-pandemic trends of interest in black, female, and living artists strengthened.
This year, they hope to build on that, tapping into an influx of young collectors who have found the online world more accessible than old-fashioned auction rooms, and as more traditional buyers yearn to return to the real world.
“There is a huge pent-up demand for expertise and even spending, once there is a little more stability and predictability,” Sotheby’s Chief Executive Charles Stewart told Reuters.
“We have the potential for the biggest boom over a period of time, assuming we get to a place where people feel comfortable leaving their homes.”
For Christie’s, 2021 has seen spectacular confirmation of the potential to create wealth from the virtual world, as it staged a record $ 70 million sale of digital artwork this month.
In an online auction that took place over 14 days, bids for American artist Beeple’s work started at $ 100 and accelerated dramatically, with 22 million visitors tuning in in the final minutes of the bidding.
Christie plans to continue the success with more sales of non-fungible tokens (NFTs) or works of art that exist only in digital form.
More people seem willing to buy artwork online without seeing the real ones first.
“What we’ve seen is the simple behavioral truth that collectors are more willing than ever to buy an image,” said Rachel Lehmann, co-founder of Lehmann Maupin, which has galleries around the world.
But he added that the digital space presents a challenge for artists and artworks that don’t translate well into an image online.
THE WINNER TAKES IT ALL
For the German artist ANTOINETTE, the confinement was not all bad: the cancellation of public events allowed her an extended stay in the castle of Merseburg, in eastern Germany, where she worked.
Using only pencils, he is creating intricate drawings on 5-meter high panels that are part of a multi-year project on European cultural identity entitled “ALTAR of Europe”.
Socially estranged locals can see their work through the windows and ANTOINETTE said they had become his network.
“I have come to feel like part of the community,” the artist told Reuters.
But if you feel artistically satisfied, financially your situation is dangerous, as commissions such as portraits have been sold out during the pandemic.
Smaller galleries are also struggling, experts say, because the pandemic has accelerated the concentration of the art world in fewer hands: very wealthy buyers and established, high-profile sellers.
“Compared to the last recession, when everyone’s wealth fell, in this one the multibillion-dollar wealth has really risen,” said art economist Clare McAndrew, author of the Art Market report.
“These things are good for art sales … But it brings us back to our old problem that the infrastructure is too heavy and the winner takes it all.”
The UBS and Art Basel report found that fairs accounted for 43% of art dealers’ sales in 2019, but only 22% in 2020, just under half of which were generated by digital events.
“The digital world is focused on buying what’s hot (on social media) and through large galleries employing more than 100 people,” said James Mayor, who has run the Mayor Gallery in London since it took over from his father in 1973..
Although he has always attended Art Basel, he has avoided its digital offerings, which, according to him, are not a substitute for the real-life event. Others agree.
“Until now, digital formats have not replaced this, as we benefit from face-to-face interaction and the atmosphere of a physical fair,” Stefan von Bartha, director of the Basel-based gallery von Bartha, told Reuters.
It’s not just the galleries that suffer.
During a typical year, Art Basel’s nearly 100,000 visitors to the city help increase hotel room occupancy to nearly full capacity during the first four days of the fair, or 35-60% above. from average levels during the week, the Basel tourist office said. .
LOOKING FOR SOULS
Galleries and advisers interviewed by Reuters anticipated the recovery in demand for fairs and arts tourism after the pandemic.
Art Basel has scheduled a fair in Hong Kong for the end of May. Other major trade shows, including TEFAF and Frieze, have said they hope to continue with live trade shows in some format later this year, complemented by digital participation.
But even before the COVID-19 crisis, some said there were too many fairs, and galleries and collectors say they will be more selective, sticking to the more local approach they have experienced over the past year.
In Hong Kong, galleries are reporting strong business as China quickly recovered from the pandemic and appetite for contemporary Chinese art grows.
“People have become very used to the extravagance of the big fairs and the big biennials held in so many major cities,” said Leo Xu, senior director at David Zwirner Hong Kong. “Honestly, I don’t miss that.”
The gallery, one of Zwirner’s six international locations, managed to increase sales in 2020, Xu said, primarily through reaching out to wealthy and tech-savvy Chinese.
Also in Hong Kong, the Villepin gallery, run by former French Prime Minister Dominique de Villepin and his son Arthur, opened in March last year at the height of the pandemic lockdown and said it had done “very well.”
In New York, gallery owners said there were positives, including a much-needed reassessment that could spell the demise of outlying art fairs, while Art Basel will almost certainly rebound.
Sean Kelly, who runs a contemporary art gallery in New York, said the loss of revenue from the art fair has been offset by the cost savings from not attending.
“We have to start thinking about the cost of art fairs and I’m not talking about the financial cost. I mean the physical and environmental cost, ”he said.