Art Market Monitor

Global Coverage ~ Unique Analysis

  • AMMpro
  • AMM Fantasy Collecting Game
  • Podcast
  • Contact Us

Philip Hoffman’s Take on Art as a Non-Correlated, Investible Asset

December 6, 2013 by Marion Maneker

Philip Hoffman
Philip Hoffman

It’s always hard to tell what quote really means when it is used by a reporter in a story. For example, CNN claims “Memories of the recession may be driving the rise in art prices.” In that, they’re quoting a brief comment from Hoffman about the trauma of asset prices collapsing during the credit crisis in 2009. But then the story starts to resemble something more like overheard conversational snippets that may or may not be directly connected:

Adding to the demand is the fact that paintings represent moveable assets in a world where security is not always assured, noted Hoffman, who said his group represents “probably 18 of the world’s top 1,000 billionaires.”

“In the case of a war, they could ship it from Lebanon to Geneva in two hours,” he said.

And some people from foreign countries may collect art because they want to keep low-maintenance assets outside their country that they think will appreciate in value.

The market is significant, with annual global volume estimated at $60 billion, he said. The investable part of that market — which he defined as pieces worth more than $1 million — represents $15 billion to $20 billion, with about half of that sold by auction houses and the rest by galleries, Hoffman said.

The whole may not be coherent but the individual comments are interesting. Is Hoffman saying that 18 billionaires are investors in his fund? Or is he referring to other services since the comments suggest these are owners of art, not investors in an art fund.

Also, with the investible threshold lying at $1m on the lower bound, what is the upper bound for investible art? In other words, at what price does a work become part of the trophy or masterpiece market where any upside will take years to be realized?

Memories of the recession may be driving the rise in art prices  (CNN.com)

More from Art Market Monitor

  • London’s Imp-Mod Sales Rise 59%, Near 2014 Peak SalesLondon’s Imp-Mod Sales Rise 59%, Near 2014 Peak Sales
  • Jade Bear Disappoints at $8m in Florida AuctionJade Bear Disappoints at $8m in Florida Auction
  • Sotheby’s Sales Reach $3.5bn in H1 2018Sotheby’s Sales Reach $3.5bn in H1 2018
  • Sotheby’s Hong Kong Spring Sales, 2007-2019Sotheby’s Hong Kong Spring Sales, 2007-2019
  • Phillips ReactionPhillips Reaction
  • Artelligence for January 18, 2018Artelligence for January 18, 2018

Filed Under: Economic Trends

About Marion Maneker

LiveArt

Want to get Art Market Monitor‘s posts sent to you in our email? Sign up below by clicking on the Subscribe button.

  • About Us/ Contact
  • Podcast
  • AMMpro
  • Newsletter
  • FAQ

twitterfacebooksoundcloud
Privacy Policy
Terms & Conditions
California Privacy Rights
Do Not Sell My Personal Information
Advertise on Art Market Monitor
 

Loading Comments...