This Sunday, the New York Times Magazine will contain this under-researched and over-reaching column about the art market that tries to connect Art Rank with a new storage facility in New York to the idea that art is increasingly being flipped. There are many problems with this thesis—Art Rank by definition only has 10 customers; storage facilities are not new and cannot function as art banks in the way the author fantasizes—but the biggest hole in William Alden’s reasoning is created by a project run in The New York Times last August. Lorne Manly and Robin Pogrebin did an excellent job dispelling the myth that art flipping is more prevalent now than it was in the past.
Despite the seemingly prosaic nature of its service, Uovo also encourages speculation in a more subtle way. Everything about the facility seems designed to remove friction from the art market — to turn physical objects into liquid assets. Apart from its private viewing rooms for deal making, which are now common in the storage business, what really sets Uovo apart is its vast database. After each artwork is tagged with a bar code, the company’s technicians use a proprietary app to quickly retrieve detailed information about the pieces, including their precise location and recent movements, says Christopher Wise, executive vice president of operations.
Wise says the technology is largely in place for security purposes, to keep track of such valuable investments. (This is not a hypothetical concern. In 2013, a Norman Rockwell painting worth more than $1 million simply vanished from its Queens storage facility, only to be tracked down later in Ohio.) But giving clients and prospective buyers remote access to so much data, while making the business more efficient, also helps make the art more like a tradable unit, able to change hands without even leaving a warehouse. Buyers can use the database in much the same way a hedge funder uses a Bloomberg terminal. […]
Enrique Liberman, a lawyer who works with funds that buy art on behalf of wealthy investors, says the art market now “has all the trappings of traditional investment markets in the form of the services provided.” While that may be a slight exaggeration — the art market, after all, remains opaque and unregulated — places like Uovo bring us closer to that reality.
There is nothing about Uovo that makes art more tradable now than it was before. In the first place, Uovo is a late entrant into an already very well-established and fairly sophisticated business, art storage. The works filling Uovo are hardly likely to be the best assets. Any serious New York collector could give you the names of two or three other facilities that would be more likely to function as an art bank, except that’s not what storage facilities do. That’s what screenwriters fantasize they do.
Uovo will do nothing to verify the quality of the works in their care, their provenance, their value or whether the person paying for storage has legitimate title. All the elements that are lumped in under the art-market-is-unregulated canard remain untouched by Uovo’s retrieval system.
Art for Money’s Sake (NYTimes.com)