Mixed message

With the fate of the Cork Street galleries nebulous at best, a feature article in Saturday’s Observer reports on the huge expansion of other galleries- many of them New York based, and seeking to capitalize on the presence of London’s burgeoning population of  über-rich expats.

With London as one of my preferred stomping grounds, it has always seemed that, in England, there was London, and then everywhere else. The fact of the matter is, despite a very slow British economy, central London real estate has done nothing but appreciate, driven, it seems, not just by bonuses paid to City types, but also by those ‘traditional’ ex pat populations, driven to London not only for an enjoyment of cosmopolitanism that may be lacking in, say, Baku, but also as safe havens for family, wealth, and personal security. The Observer reports a total of nearly 6,000 London inhabitants with a net worth of more than $30,000,000.

It is surprising, though, that the expanding galleries are those whose stock in trade is so similar to that of the struggling galleries. 20th and 21st century art drives, or fails to as the case may be, both. Traditionally, newly rich oligarchs would collect two things- art from their home culture that had at some time in the past left its place of origin, and quality European fine and decorative art already broadly established in the canon of art and design. Neither of these collecting channels are too surprising- for those newly rich, collecting what was often the court art of their home country brings about an association with a golden age and an aristocracy that, in many cases, has gone extinct. European art and antiques, of course, has long functioned to establish an affiliation with generic wealth, with the archetype for taste and culture in the modern age the European, and most specifically the English, aristocrat. It has always mystified me that, in the last few decades collectors from non-western cultures would be aggressive acquisitors of cutting edge western art. Perhaps it is that so many of the successful contemporary galleries have within their bag of tricks the magical ability to be market makers. The length of their purses is enhanced enormously by collectors whose objective in their own endeavors is to be market makers, who financially assist their pet gallery owners in making strategic high profile (read ‘record-breakingly expensive’) purchases of works by artists well represented in the collectors’ own collection. That, and the occasional monograph by an art historian who is able quickly to adopt some suitably recondite methodology and spit out enough adjectives to fill a volume of requisite size can often result in a successful, by which I mean highly profitable, series of gallery shows.

Canonicity is established in a variety of different ways and I suppose that some conscious manipulation of the art market by salting certain auctions with inordinate prices, is one ever so slightly nefarious way. And I suppose that those high net worth collectors not in on the deal have enough on the ball generally to know what it is they’re paying for. Or do they? I can’t help but think all this is more than a little like the snaky art dealer proffering the work of some minor contemporary artist in Woody Allen’s Small Time Crooks, victimizing the well-heeled but otherwise parvenu wannabes. Did someone say ‘dupe’?

Millionaires for billionaires

Yesterday I had a chat with a young man of long acquaintance, whose vocation as a business journalist means that, as well as knowing a collateralized debt obligation from a credit default swap, he’s also inquisitive. And inquire he did about what we colloquially term ‘the trade’. Over several beverages, I perhaps not waxed eloquent but yet always sufficiently loquacious, what we discussed elicited insights into the dynamics of this business that were certainly a surprise to my young friend- and as they are to me in the repeating.

Perhaps most surprising of all is my supposition that, while the trade captures the attentions of millions, those involved- sellers and buyers- amount to maybe 100,000 people on the planet. No question, the ranks of those who sell within the accredited trade have shrunk in the last decade, but those who are left- either through luck, trading skill, or depth of pocket book- have themselves had to make certain that their stock, their trading platform, and their palaver are consonant with and responsive to the small cadre that constitutes the buying public. And those buyers have never, ever been abundant. In our little business within this rarefied stratum, one’s inventory has to constitute an investment into the 7 or 8 figures. We are not, though, selling to ladies and gentleman with comparable net worth- we would, of course, but our material finds its way to high 8, and more likely 9 figure folk, whose acquisitive sense, we’ve come to discover, is through to their very marrow. They have money because they make money and are wont to let it out of their grasp. Not surprising, then, the sale of a  6 figure artwork or decorative item is always the subject of a lot of to-ing and fro-ing and requires a fair old bit of finesse on our part. What we’ve found, to our chagrin, is that our buyers find it very, very easy to walk away from a deal. They do it in their everyday lives- when a punter can walk away from a billion dollar gas lease upon which millions have already been spent in development costs, can one really expect it would be any less easy a matter to close the book on the sale of a $175,000 early Georgian bureau cabinet?

With all that, we have come to understand that despite a stratospheric net worth, everybody has a budget- and I do mean everybody. We have never, ever seen anyone encash an investment to make a purchase from us. Purchases are always made from cash on hand, and, if the sale extends beyond the buyers’ immediate cash limitations, we have never seen anyone reluctant to ask for a bit of time to complete the sale. Mostly we can accommodate, sometimes not, but I suppose the point of all this is, given the limited pool of buyers, if one can’t roll with the flow, one had better exit the trade.

Cork Street, le deluge

Time’s running out for Cork Street, one of the world’s pre-eminent venues for the fine arts. Take a moment and append your name to the e-petition and let’s do whatever it takes to save something unique in the art world.

SAVE CORK STREET

What was strongly hinted by friend and colleague Elliot Lee is now official- art galleries along vaunted Cork Street have been told by the new property owner that their leases will not be extended beyond June of next year. Although it is reported that the effected dealers, including that most venerable of modern art venues Mayor Gallery, will be offered some sort of compensation, whatever the offer it will only  amount to a token compared to the damage done. In a fickle business like the art and antiques trade, anything that interrupts trading is for all intents and purposes a death knell.

As with so much of the West End, as with Madison Avenue in New York, dealers are displaced by mass market retailers, mostly clothing, nearly all of whom are outlets of chains publically owned whose volume of business and stronger capital structure enables them to pay far, far greater rent than galleries, nearly all of which are privately owned and single outlet.

One has to ask the question how many Fendi stores are needed in the world? Mind you, I’m not trying to deprive Karl Lagerfeld with a way to make a living, but the original location in Rome seemed, as it had for the first 75 years of its existence, adequate to serve the beau monde. The proliferation of international couture functioning as it does now to push out locally distinctive business, ultimately yields to shopping venues that might be seen anywhere. Why visit Rome to shop the Via Condotti when one can go to the local mall? Givenchy at Wal-Mart? The mind reels.

I hate to consider the prospect of London, in the current case, moving toward losing its identity as arguably the world’s leading art market city. What provides more for the ferment of the cutting edge than leading private galleries whose ownership maintains the vision and courage to mount exhibitions that might otherwise remain unseen? Where would post impressionism be if not for the groundbreaking exhibition at the Whitechapel Gallery in 1914? City planners, certainly in London, realize that any number of specific urban characteristics- and that prominently includes art galleries- contribute to the benefit of the commonweal by their presence, consequently yielding development of conservation areas as a safe haven- but in the short term, who can stand up to the financial onslaught of mass market retailers?

A further irony here, more apparent perhaps in the US but moving inexorably toward Europe, the advent of internet shopping has thinned the bricks and mortar presence of all manner of storefront, even luxury retailers. Witness the vacancies along vaunted thoroughfares like our own Post Street in San Francisco, a victim to the inexorable phenomenon of the virtual displacing the actual. Though vacancies now ostensibly making leaseholds more affordable, the predations of the last several years have now rendered galleries to fill in the gaps the status of ‘former’ and nothing but a memory.

Knock Off

Not so long ago, a spate of emails came through from a dealer friend, bitterly decrying how a mass market furniture retailer had done him wrong by knocking off a piece in his inventory- a vintage industrial type hanging lamp. Deeply angry as he should have been that he, working hard as he does to try and find unique items to offer through his galleries, to then be victimized by a company whose sole intention was to mine his taste and effort- without compensating him for it.

As it happens, about the same time we received an internet inquiry from a lady in England on a set of 12 dining chairs, Louis XVI in style, but made by Maison Jansen and originally installed in a Jansen-designed villa in Mexico City. Although she complimented us on the chairs, the punter remarked that she had seen similar chairs offered through an online sales platform for less. My fingers nimbly sprang into action, and I found the same chairs, or should I more accurately say, the very roughly similar chairs, with the online descriptive text giving the vaguest of vague hints as to a relationship with the Paris decorating firm.

On the same day, a huge catalog arrived from the ere mentioned mass market retailer, showing yet another example of similar chairs, newly made, for a fraction the price of even the cheaper Louis VXI style chairs offered through the online source. I made a point of going to the retailers’ local showroom to examine their offerings, to get a sense of what might make the cheapest even cheaper, and so much more so. And it was cheaper in every sense- mediocre timber, not much detail, and fairly poor quality craftsmanship, and pretty basic upholstery. A knockoff of an earlier style, but certainly not a copy, and by the by, it was one of masses of similar pieces, all sharing the same sort of period inspiration- but sharing the same dearth of period quality.

It occurred to me, though, much as I would like to decry the hawking of inferior goods, this was price point merchandise, and it was young-ish folk who were inside looking to buy. I always tell my own clients to hold on to your money until you can purchase something of good quality, but the fact is, that money is sometimes rather slow in coming, and sitting on camp stools or folding chairs gets pretty old after a few months. Yes, these pieces I’ve heard so often described as ‘early marriage’, giving a chronology to their period of acquisition, will doubtless be the garage sale items of the not so distant future, but the fact of the matter is, what was on offer at the retailer had a period appearance, albeit a poorly executed one, and consequently gave me some degree of hope. People buy what they like, at a price they can afford, and if it is something of a period design, eventually, if the gods of an improving economy remain sufficiently propitious, the looks like but not really the same will be replaced, in the fullness of time, with the genuine article. Hope does spring eternal.

But for the moment, I have to content myself with the realization that knockoffs of period items are now and have for generations been firmly entrenched. And, at the end of the day, what did Maison Jansen do very much of the time but restate, even to the point of literal reproduction, those items of an earlier day. Doubtless 18th century ebeniste Georges Jacob would have been no happier than his modern colleagues to see his pieces knocked off- even a century on and even by a house as vaunted as Maison Jansen.

Right Place, Right Time

An article in a travel magazine discussed the prevalence of billionaires amongst a local university’s recent graduates, related, it seems to its proximity to Silicon Valley. That these billionaires all had some sort of computer science background in common as well should be no surprise even to those of my readers, some of whom are some distance removed from the local area who possibly may still use quill and ink.

It’s also no great surprise that so many of these newly minted grandees should end up so wealthy. Wealthy on paper, at any rate, as doubtless most of them have assets- net of BMWs and Lamborghinis and Porsches, of course- mostly composed of restricted issues of stock or other business equity,  the result of some IPO or takeover or investment from the myriad venture capital firms that proliferate in the greater Bay Area. The plain fact is, despite the economic doldrums, we exist in an environment capital rich for certain, read ‘tech’, industries.

When thinking about the less tangible but ever so present products of technology- search engines, social networking sites, and any other manner of ostensibly free online services- the question is begged about what it is they have in common. The answer is- everything, at least in so far as success in this virtual world is measured. They are all reliant upon online advertising for their revenue stream, which advertising amounts to precious little- witness the numbers of heavily capitalized companies that either are marginally profitable or have yet to become so. For ourselves, our foray into internet advertising lasted only a couple of months and netted us nothing but a bill from the search engine. With all that, enough businesses large and small have the occasional flutter that, presumably, there exists at least one plus new advertising punter for each one that drops out.

There also seems to be a notion abroad that, lacking profit, site activity itself has some not quantifiable but nevertheless tangible value, with each site hit yielding some kind of personal information that may provide some valuable marketing information in the future. Seems reasonable, I suppose, but, looking at my daily junk folder, whatever personal information has been gleaned about me results almost entirely in ads for Viagra and knock-off wrist watches. If the sources of any of those emails reads this- for the record, my extremities both above and below the waist are well kitted out, thank you very much.

Still and all, something good must be happening, because the local unemployment rate is about the lowest in the nation, and local real estate economy is ticking along nicely. And I guess luxury car sales must be pretty good. But the economic strength that most would admit is largely a local phenomenon shouldn’t occlude the fact that for a very limited number of fortunate individuals, they happened to be in the right place at the right time, doing the right job.