“An art collector is like a hunter, only that instead of dogs they have art advisors.” Artsy.net Contents 4 Welcome to Maddox Fine Art 6 Introduction 8 Art as an Investment 10 The Current Global Art Market 13 The Two Art Markets 14 Artist Classifications 16 An Emerging Artist - Bradley Theodore 18 An Established Artist - Banksy 20 A Blue Chip Artist - Andy Warhol 22 Factors that Drive the Art Market 24 Reasons to Invest in Art 25 Why Invest with Maddox Fine Art 26 Selling Art 28 Portfolio Management 30 Making a Purchase 32 Ancillary Services 34 Visit us Richard Hambleton 36 Art Market Terminology ‘Shadow Horse & Rider’, 2009 267 x 166 cm 39 Contact us Oil on Canvas 2 Maddox Fine Art 3 Welcome to Maddox Fine Art We are a specialist art investment consultancy and the sister company of Maddox Gallery, an international group of six contemporary art galleries headquartered on Maddox Street in Mayfair, London. We provide clear, unpretentious art investment advice to our clients in order to help them navigate the sometimes dizzying landscape of the contemporary art market. As such, we have a core team of investment art James Nicholls in conversation with Luke Blackall specialists dedicated to providing art investors and on the London Live TV art show. collectors with the tools needed to invest wisely in contemporary art. We specialise in identifying and Our team is headed up by our Chairman supplying works of art by emerging, established James Nicholls. and blue chip artists which have the undoubted potential to drastically increase in value. James is an internationally recognised investment art specialist with many years of experience. He is the resident art critic for the London Live TV channel; the resident investment art expert for British Airways – featuring in BA’s long-haul in- flight programming for the last four years; and a contributing art expert on myriad publications. James is also a Patron of both the National Portrait Gallery and the Royal Academy of Arts. His expertise covers a wide diversity of works from Caravaggio to Banksy, and cutting-edge James Nicholls presents the Columbian ‘Oro emerging artists, such as Bradley Theodore. Exhibition’ to the Countess of Wessex. Over the coming pages, we provide a guide to the art market and our services. Inside our flagship Maddox Street Gallery 4 Welcome to Maddox Fine Art Maddox Fine Art 5 Introduction The global art market has grown exponentially in the last two decades, and collecting art is no longer the preserve of an aristocratic elite. The hunger for contemporary art is now insatiable, with a broad spectrum of society desiring to buy and collect works, not only to enrich their lives via aesthetic appreciation, but also as a serious investment for the future. At Maddox Fine Art we help both the novice and We firmly believe that every acquisition should expert navigate the ever-shifting landscape of the be a marriage of aesthetic appreciation and wise global art market and provide advice and investment, and we make it our business to offer guidance on making the right kinds of investments both the novice and experienced investor the – make no mistake, contemporary art is big perfect marriage of an enriching and sophisticated business, with leading galleries in the UK appreciation of contemporary art and the financial attracting in excess of 15 million visitors last satisfaction of investment performance. year alone. Accordingly, the acquisition of art as a high- performance asset class is no longer considered an alternative financial investment, but a key one. In a 2017 poll conducted by Deloitte, 88% of Wealth Managers believe Art should be a key component of an investment portfolio. “The contemporary art segment of the Mei Moses Art Index has delivered a compounded average annual return of 8.80% over the last 58 years.” Date: 26th March 2019 Source: www.sothebys.com Andy Warhol ‘Campbell’s Soup II’: Vegetarian Vegetable, 1969 / 63 x 84 cm / Silkscreen Print in colours on paper 6 Introduction Maddox Fine Art 7 Art as an Investment At Maddox Fine Art we can supply investors If you have a particular artist whose work you with access to investment grade art from as would like to buy, then we can often ascertain little as £10,000. At this affordable level, you exactly which works are available, and at what can acquire something from an emerging or price – through our extensive international network established artist who has already created an of art market contacts we can usually source work impression in the market, and whose work we from artists, studios, agents, collectors, and other believe has the potential drastically to increase galleries. If it’s work by one specific artist that you in value in the future. want to acquire, then we can act as your buying From the £20,000-mark we can often supply agent for a small commission. Mel Bochner Mel Bochner investors with access to work by blue chip artists. Conversely, if you have something you are keen ‘Ha Ha ’ 2017 / 87 x 91 cm / Monoprint with collage, ‘Blah Blah Blah ’ 2017 / 70 x 56 cm / Monoprint with At this higher price level, you can own a piece to sell, we’ll certainly consider displaying it in engraving and embossment on hand-dyed collage, engraving and embossment on hand-dyed by an artist whose name is widely known– one our gallery (providing it meets our criteria for Twinrocker handmade paper Twinrocker handmade paper who has already attracted significant attention price performance potential), handle any interest, in both the media and the market, and from and administer the resulting sale – again, we will serious collectors. charge a small commission for work of this nature. At Maddox Fine Art we provide an extremely The Sotheby’s Mei Moses Index: 1950-2018 comprehensive service, and we can take care of framing, hanging, delivery, storage, and much 1,000 more besides – for further information on these ancillary services please see page 32 of this guide. 100 (since 1950) 10 Index value 1 “88% of Wealth Managers believe Art 1950 1960 1970 1980 1990 2000 2010 2018 should be part of a Wealth Management offering (up from 78% in 2016).” The graph above shows the Sotheby’s Mei Moses Index for the broader art market Source: Deloitte & ArtTactic Art from 1950 to 2018. The index benchmarks at 1 in 1950 and shows the trajectory & Finance Report 2017 in demand for the overall market, a compound annual growth rate of 8.8%. Source: Sothebys.com 8 Art as an Investment Maddox Fine Art 9 The Current Global Art Global Art Market Market Share With $67.4 billion in total sales during 2018, the global art economy grew The US once again confirmed its position as the largest market for art for a second consecutive year - a rise of 6% from the 2017 total of $63.7 sales, with its share of total global sales by value increasing by two billion and just under the 2014 high of $68.2 billion. percentage points to 44%. The US, together with China and the UK, accounted for 84% of total sales by value. Sales in the Global Art Market 2008-2018 Other than in 2011 when China achieved a dominance until 2014, as its sales went through Billion $ marginally greater share of world sales, the US an unprecedented boom and the British market has been the leading global sales territory for recovered from the fallout of the global financial $80 the last 20 years. It’s position at number one has crisis. The UK recovered share in 2015 and $70 $68.2 $64.6 been underlined in recent years as its lead over its 2016 and regained second place, but a strong $62.0 $63.3 $63.8 $63.7 $67.4 closest competitors has risen to more than 20%. year of sales in China and a weak Pound meant $60 $57.0 $56.7 $56.9 China was once again in second position by a $50 The countries occupying second and third places have fluctuated in recent years. small margin in 2017. However, in 2018 the UK $39.5 $40 regained its position as the second-largest art Having had less than 5% of global sales until market (21%), while China was the third largest, $30 2006, China overtook the UK’s long-established with 19%. $20 second place in 2010. China maintained its $10 $0 Global Market Share of the US, UK and China 2008-2018 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 US China UK Others Source: © Arts Economics (2019) 100% 18% 16% 17% 17% 17% 16% 22% 21% 23% 19% Sales in the global art market in 2018 reached The UK had a strong year of sales, shrugging off 28% 80% $67.4 billion, up 6% from 2017. This second year Brexit worries, with values rising 8% to just 20% 21% 22% 23% 22% 21% 21% of strong growth has brought the market to its over $14 billion. 22% 20% 60% 34% 23% second-highest level in the last 10 years. Meanwhile in the rest of Europe, many of the 19% 21% 19% 25% 23% 20% 23%9% 30%9% 9% 24%9% 9% 40% The auction sector made up 46% of the market, larger markets declined. 9% 18% down 1% year-on year, while the dealer sector Sales in China cooled slightly to $12.9 billion 20% 43% 40% 42% 44% (gallery and online retail sales) accounted in 2018, a decline of 3% on the 2017 figure 35% 36% 39% 31% 34% 29% 33% for 54%.