Contemporary Art Investment: An investment in beauty

Contemporary Art Investment: An investment in beauty

by Nick Hendry

Many cigar aficionados will know that certain rare and Limited Edition Cuban cigars are a sound financial investment, as well as a luxury product to be enjoyed.  Their purchase can be looked upon as a win-win situation: either make a handsome profit as the value rises, or smoke something exquisite from your humidor for a special occasion.  There cannot be many investments safer than an artisanal product you are certain to enjoy, regardless of what happens to the market for its sale.  Buy what you love, and you will never lose out.

Another market in which this adage holds true is that of contemporary art.  The market for investment in works less than 75 years old, much of which is produced by artists still living and working today, is booming.  Shrewd purchases of works by big-name artists can show vast returns in just a few years, while supporting the work of emerging artists can offer excellent price points to access this lucrative sector for the first time.

French artist Invader has become an established name in the art world

 French artist Invader is already established within the art scene.

Buying a piece of art to decorate one’s home – perhaps to dress your smoking lounge – is a delicate process, not to be taken lightly.  The cost associated with acquiring something unique and of exceptional quality is, naturally, significant.  The piece will most likely be with you for several years, should you choose to cash in on a rise in the creator’s popularity, or even a lifetime, should you decide you love the work too much to part with it.  Contemporary art investment is an art form in and of itself.  It is subject to the same market fluctuations and risks as the purchase of any other asset, but with an upside few other markets bring.  You will never be able to gaze upon the beauty of a stash of Bitcoin, or discuss with guests how the colour of your Tesla stock accentuates the design choices you’ve made in your living room.  A beautiful work of art on the wall, much like the scent of some 2014 Cohiba Robustos Supremos in your humidor, will bring much more joy to your life, as well as remind you there is a tangible asset in your possession to show for your investment.

Many options exist for the potential investor looking to take their first steps into the art market.  As more people have sought out alternative havens for their capital since the crisis of 2008, more galleries have opened up to provide a space in which works can be viewed and considered not just for their fiscal value, but also their aesthetic appeal.  One of the youngest is Red 8 Gallery, who have spent the last few years assembling a team of highly experienced art brokers to advise clients searching for the perfect balance of growth potential and physical beauty.  In late 2021 they celebrated the opening of a new location within London’s famous Royal Exchange – itself once home to a global stock trading market, and now a leading destination for luxury shoppers – and have curated within its walls a collection of works broad enough to serve a wide range of tastes and budgets.

A collection of works by London's Panik at Red 8 Gallery

Camden-born Panik has become a highly respected artist.  View and purchase his works at Red 8 Gallery.

During a viewing of the pieces on show in their new home, the gallery’s Director of Operations, Sean North, explained how the Red 8 serve art-lovers who work with them.  “Red 8 Gallery operate in both the primary and secondary art markets; that is to say we represent emerging artists selling pieces for the first time since their creation and can also source works by established names at clients’ request.”

According to industry experts ArtPrice, the auction revenue generated by contemporary art (artists born after 1945) has grown from $109million at the turn of the millennium to $1.7billion in a disrupted 2020.  Little wonder, then, that so many seasoned investors have begun to venture down this path.

"Cohibas" by Cayla Birk

"Cohibas" by Cayla Birk is an ideal emerging-artist work for the cigar aficionado

“We classify our artists in three ways: Emerging, Established, and Blue-Chip.” Sean continues. “Emerging artists are those who are beginning to generate a bit of buzz in the press, perhaps winning some awards, and are considered an opportunity to get in early and produce large returns.  We present their works on the primary market; the first time they have been available for sale.  Established artists are those who have already become collectable and whose work will likely appreciate in value more quickly than artists at the beginning of their careers.  Blue-Chip are those who have seen their reputations transcend the art scene and become household names across the world.”

Banksy works are available at Red 8 Gallery

Banksy's work is instantly recognisable.

This last category, of Blue-Chip artists like Banksy and Warhol, may be the most difficult to enter in terms of the price tags placed on works, but is also the safest in terms of protecting the value of your investment.  As demonstrated by the queues in Bristol recently to pick up one of his limited edition t-shirts, Banksy’s draw is stronger than ever.  Conversely, established artists who have just started out produce much more affordable work, but present a greater risk with regards to where their careers, and the value of their pieces, may go in the future.

Whichever end of the market one chooses to enter from, the opportunity arises to acquire an asset which will not only increase wealth, but also bring joy to the owner for as long as it is in their possession.  It is not often these two qualities overlap as comprehensively as with contemporary art, and to be able to take advantage is a gift we would be wise to accept any time it is offered.  When we can make money from enjoying beauty, we have made a truly wise investment.

With thanks to Red 8 Gallery for all imagery.  Their collection is available to view Monday to Friday at 35 The Royal Exchange, London, EC3V 3LP. For more information, contact sean.north@redeightgallery.com.

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