Collectables: Carbine upstages auction heavyweights

Sales of racehorse art often ride on the animal rather than the artist, as the auction of a portrait of the great Carbine attests.

Carbine, the 1890 Melbourne Cup winner and the greatest racehorse to grace the ­Australian turf before Phar Lap, made a brief return to the spotlight last week – as Lot 62 at Sotheby’s Sydney sale of fine Australian art.

The handsome, if flattering, portrait of “Old Jack” was painted by Frederick ­William Woodhouse snr in 1891, the year Carbine retired from racing and began an influential stud career. The work stood out like a beacon in a catalogue clogged with the usual quality saleroom fare of Olsens, Boyds, Blackmans, Smarts and Co.

After a brief bidding war, the painting was knocked down for $34,000 against an upper saleroom estimate of $20,000 to horse breeder Grahame Mapp, owner of Hobartville Stud near Richmond, NSW, reputedly Australia’s oldest thoroughbred stud. With buyer’s premium and GST, the price tag was $41,095, the second-highest price for a Woodhouse, according to Australian Art Sales Digest, which also notes the Englishman arrived in Australia in 1857 and painted every winner of the Melbourne Cup from 1861 to 1890.

Collectables: Rover Thomas

Doubting Thomas: After the high-profile failure of a 'million-dollar' Rover Thomas painting, Sotheby's are questioning the state galleries' commitment to Aboriginal art.

It looked a cinch on paper. An exceptional painting by Australia’s most famous indigenous artist, Rover Thomas, depicting the country’s most mythical physical feature, Uluru. The perfect work on which to hang publicity for the annual blockbuster sale of Important Aboriginal Art at Sotheby’s in Melbourne late last month.

The NYSE-listed company went for broke, pegging the upper estimate at an astonishing AUD$1,000,000. Out went the press releases: “Million Dollar Painting on Display”. Dutifully, out went the newspaper previews, noting Aboriginal art’s “first million dollar painting” in headlines, body copy and captions.

Noone thought to mention that the figure was just an educated, but essentially hopeful, guess on the part of Sotheby’s Aboriginal art specialist, Tim Klingender. Nobody asked why this painting was worth more than $200k above Thomas’s current auction record, [which is also that for any Aboriginal artist]. Notwithstanding the Aboriginal sector’s astounding growth in recent years, nobody bothered to ask who had a million dollars for an indigenous work, given the current benchmark had been set not by a private collector but by a state art gallery, and that the galleries haven’t splurged on a major indigenous work at auction since.

Back in 2001, when the National Gallery of Australia went to $786,625 to secure Thomas's "All That Big Rain Coming From Top Side", saleroom watchers gasped that the top end of the market could run so far ahead of the pack. Were market forces really speaking, or where they being amplified through the megaphone of Sotheby’s slick marketing?

These observers weren’t surprised to see "Uluru" passed in for $675k, failing even to meet it’s lower estimate of $700k. “It was a good painting, but not outstanding,” said one rival auction house expert. “The price it passed in at was a fair one.” While admitting his estimate had scared off potential buyers, Klingender bemoaned the fact that Australia’s collecting institutions weren’t coming to his party.

“It’s amazing the state galleries aren’t here picking the eyes out of our catalogue," Klingender told The Bulletin. "The National Museum of Australia bought three works…, and the Art Gallery of New South Wales bought one, but none of them are buying at the top end – everything above $100k all went to private collectors.”

Sotheby’s sustained foray into the Aboriginal art market since the mid 1990s has been met with disdain and suspicion by the country’s major collecting institutions. Klingender can’t fathom the snub. “The curators of these galleries don’t even come to the previews – it’s ridiculous and small-minded.”

Ironically, the Rover flop cruelled the headlines for what was otherwise another sensational sale from Sotheby’s: $6.5 million in total sales with bullish clearance rates of around 70 per cent both by lot and by value. Among the more than 60 new artist auction records set were such eminently collectable artists as Charlie Tararu Tjungurrayi (new benchmark $215,200); Dorothy Napangardi ($131,725) and Eubena Nampitjin ($52,200).

Collectors need not fear, the indigenous art market’s perpetual boom remains intact, though Sotheby’s position as market leader is under assault as rival houses, Lawson~Menzies, Christie’s, Bonham & Goodmans and Shapiro’s have all commenced moves to grab a slice of this dynamic art market sector.

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Abridged version published in The Bulletin

2004 - Australian Culture Now, Fed Square

"Now" is the operative word in this new survey of Australian contemporary art, the most ambitious mounted in five years, say co-hosts NGV Australia and the Australian Centre for the Moving Image (ACMI). 2004 - Australian Culture Now represents the first major collaboration between the two principal tenants of Federation Square in Melbourne, the former one of Australia's oldest cultural institutions, the latter barely two years old and playing catch-up.

At its June 14 launch, NGV director Gerard Vaughan announced 2004 had been "deliberately timed for the Biennale [of Sydney]", which opened a week earlier, "to get international visitors to see both buildings fully operating". Hardly a noble aspiration but cultural tourists seeking a quality museum experience will still come away sated. Certainly, 2004 leaves a stronger aftertaste than the thematic conceits of the Sydney Biennale. On Reason and Emotion is left looking a little tired and emotional against the optimism of 2004's brash demand for "strayin' kulcha now!"

Bar a few exceptions, such as octogenarian Aboriginal artist Paddy Bedford, 2004 is stacked with twenty- and thirty-somethings presented as the latest uncomplicated incarnation of "the new". Ten curators from both NGV Australia and ACMI have chosen 130 artists to exhibit in their two gallery venues, on free-to-air television and across vast chunks of cyberspace and other virtual networks. Should 2004 be well received, the plan is to mount the national survey every three years, slotting into the calendar in years complementary to Sydney's Biennale and Brisbane's Asia Pacific Triennial (due again in 2005). At least the major sponsor, Ernst & Young, is happy. The management consultants, standing in as modern-day Medicis, are certain that 2004 offers "a snapshot of the most exciting things happening in Australian art today".

Art borders blur at "2004 – Australian Culture Now"

2004 – Australian Culture Now, Federation Square, Melbourne. Ian Potter Centre: NGV Australia

***

Youth and the present are at the core of a major collaboration of two Melbourne galleries in an ambitious exhibition of Australian contemporary art, writes Michael Hutak. 

Nicholas Folland's I Think I Was Asleep 

"Now" is the operative word in this new survey of Australian contemporary art, the most ambitious mounted in five years, say co-hosts NGV Australia and the Australian Centre for the Moving Image (ACMI). 2004 – Australian Culture Now represents the first major collaboration between the two principal tenants of Federation Square in Melbourne, the former one of Australia's oldest cultural institutions, the latter barely two years old and playing catch-up.

At its June 14 launch, NGV director Gerard Vaughan announced 2004 had been "deliberately timed for the Biennale [of Sydney]", which opened a week earlier, "to get international visitors to see both buildings fully operating". Hardly a noble aspiration but cultural tourists seeking a quality museum experience will still come away sated. Certainly, 2004 leaves a stronger aftertaste than the thematic conceits of the Sydney Biennale. On Reason and Emotion is left looking a little tired and emotional against the optimism of 2004's brash demand for "strayin' kulcha now!"

Collectables: End result: lots

With the share price of troubled Tempo Services hitting a five-year low of $1.02 on May 4, its chairman, John Schaeffer, could at least survey the recent dispersal of his art collection warmed by the knowledge he was getting top dollar. However, as the dust settles from the "garage sale of the century" at Rona, Schaeffer's $28m Bellevue Hill mansion in Sydney's eastern suburbs, collectors are entitled to ask: was it worth the hype?

It was to Christie's, which spent a small fortune promoting the sale. If there are any other cash-strapped multimillionaire art lovers out there, Rona was a great ad for Christie's, which shifted 570 lots - $5.19m in paintings, sculpture, furniture and decorative ephemera - at top-gun clearance rates by lot (85.3%) and by value (88.7%).

Collectables: Fairweather trading

Ian Fairweather, Last Supper, (1958).
Collection: Art Gallery of New South Wales

The modernists have been trumping the contemporaries in the salerooms, while a Picasso scooped the pot, writes Michael Hutak.

There's an inverse – some would say perverse – law of the Australian art market that says the more conventional the wisdom, the less sway it holds. An example: in the past few years, we've been told the moderns favoured by old fogeys are on their way out as the market moves to accommodate cashed-up young fogeys, who allegedly prefer contemporary art and art photography.

Last week's round of fine-art auctions threw that theory on the scrapheap as record sales of modernists such as Ian Fairweather and Margaret Preston cast the passed-in works of hitherto hot contemporaries Tracey Moffatt, Tim Maguire and John Kelly into a new, uncertain light.

Ruckus over resale royalty

With pressure mounting for the introduction of a resale royalty on works of art every time they change hands, auction houses are becoming anxious, writes Michael Hutak.

Fine art worth more than $91m changed hands in Australia's booming auction market last year, yet the artists responsible for those works (or their heirs) saw not a red cent of it. One auction house, Sotheby's, shifted $7.9m of Aboriginal art at one sale last June. Yet living conditions on many of the remote desert communities where the finest indigenous artworks originate remain a national disgrace.

Media attention on anomalies such as the late Johnny Warangkula Tjupurrula – one of the originators of the dot-painting phenomenon who spent his final years in abject penury while works he had sold for $30 went for hundreds of thousands in the saleroom – has accelerated calls for a resale royalty to be introduced in Australia.

Such a royalty, also known as a droite de suite after the French scheme that has been in place since the 1920s, is a fee – typically fixed at about 5% of the hammer price – that goes to the artist every time an artwork changes hands in the secondary market. Support for such a scheme gained momentum in 2002 when Rupert Myer made a resale royalty a key recommendation in his federal government inquiry into visual arts and crafts funding.

However, the prospect of a new tax on collectors has the secondary art market in a lather as it collectively points towards a fast-falling chunk of sky.

"It's been highly unsuccessful in France," says Paul Sumner, chief executive of Sydney auction house Lawson-Menzies. "And it hasn't actually reduced the gap between rich and poor artists – it just rewards artists who are already successful."

Sumner, who has just an-nounced that his firm will take on market leader Sotheby's for a slice of the lucrative Aboriginal market, says Lawson-Menzies will pay 2% of its normal commission on sales of indigenous works into a new foundation that will donate funds to improve health and living conditions in Aboriginal communities.

The foundation hopes to raise $200,000 in the first year. However, Sumner acknowledges the impetus for setting it up is to derail the resale royalty juggernaut. "We're trying to head it off," he said. "We think it will be a nightmare to administer and ultimately will only hurt the artists."

But citing a 2003 Australia Council study, which found that 50% of Australia's artists earn less that $7500 a year from their art, Labor arts spokeswoman Senator Kate Lundy argues that artists couldn't be hurting much more than they are now.

The creation of a decent ongoing income stream for artists "is way overdue and it's Labor Party policy to introduce a resale royalty", she says. Lundy, who introduced a private member's bill on the issue in the Senate on March 11, concedes it has no chance of passing without government support. However, she says she's "calling the government's bluff on this. There's simply no excuse for them to delay their response to Myer any longer."

Last September, a year after Myer reported, then-Arts Minister Richard Alston promised a response on resale royalties before the end of the year. Six months later, his replacement, Daryl Williams, who also retires at the next election, is backing away from the idea.

"The government will only commit taxpayers' money to developing an implementation strategy if it is satisfied that we should implement a resale royalty scheme," a spokesman says. In other words, it's not satisfied.

Labor's draft bill is modelled on European Union legislation, where a droite de suite will extend to member countries from 2006. Lundy was advised by the National Association for the Visual Arts, the Australian Copyright Council and Arts Law, which have urged the government to act on Myer's recommendation and implement the scheme.

"We need a decision," NAVA executive director Tamara Winikoff says. "This issue has been kicking around for 20 years and it should be a bipartisan issue. We're very pleased that Labor has committed itself to a bill, and we urge the government to support it."

Not everyone in the trade is contrary. Sotheby's Tim Klingender has gone on record several times in favour of a droite de suite. "I think it would be great if it could be made workable," he says. And leading Melbourne Aboriginal art dealer Gabrielle Pizzi believes a resale royalty is "an inevitability".

But she warns: "Some people will have to be dragged kicking and screaming to it."

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First published in The Bulletin

Collectables: Dake Frank

Auction prices fetched by some Australian contemporary artists are rocketing. And those about to take off display obvious signs.

The hullabaloo over painter Tim Maguire hit the heights last November when Untitled 1997, a massive split-screen canvas, brought $329,000 at Christie’s Melbourne – the third time in 2003 that a new peak was set for Maguire's florid photo-realist visions. Just one year earlier Deutscher~Mennzies had offered a comparable work with an estimate of just $10k-$15,000 (it sold for $35,250).

The latest benchmark sent market watchers into overdrive: Maguire was the new John Kelly, who was the new Garry Shead, who was the new Bill Robinson, etc. Such headline-grabbing sales are more salacious evidence of art’s potential for a quick return-on-investment, and the cue for another tranche of cashed-up, dumbed-down, saleroom ingenues to turn up, grab a paddle and start splurging.

But those hoping to get a piece of “the next Tim Maguire” should also note that the savvy buy and sell on the way up, not at the top of the market. The time to pick saleroom sensations is before they become headline fodder. Maguire, however, did fit a model that made him ripe for reaping so here’s a quick checklist for pinpointing who’s next.

First, go for beauty over brains. Ugly doesn’t wash in the saleroom, no matter how much the critics might wax lyrical. Second, stick to contemporary artists, the market’s current growth area. Third, seek out artists in their late 30s and 40s with a good body of work behind them; those who have shown they can conduct a sustained professional practice. Fourth, opt for artists who have been on the critics’ radar for more than a decade but are still new or unknown to the saleroom, ie. those with less than 50 works offered at auction. And lastly, if you plan to hang the work awhile before moving it on, it helps to like it.

Still sound like too much work? Forced to tip, 45 year old Queensland-based painter, Dale Frank, fits the Maguire model to a tee. Ever-present on the contemporary scene for over 20 years, the prolific Frank shows with the country’s leading galleries and has impeccable critical credentials, with reams of favourable reviews, several monographs published, and a retrospective at the Museum of Contemporary Art, Sydney in 2001 to boot.

Represented in every major state gallery collection, Franks’ luscious abstract works already bring vast slabs of colour to white-walled foyers and living-rooms from Kirribilli to Kew. Yet Australian Art Sales Digest records reveals just 47 works have ever been offered at auction.

However, again last November, Christie’s set a new artist record of $21,150 for a handsome 2 metre square painting. That was the jump on previous sales that canny collectors look for and it is a very attractive floor price for works that could easily climb to $100,000-plus without raising an eyebrow.

[For the record, I don’t own any of them.]


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Abridged version published in The Bulletin

Art Market Notebook: Autumn 2004

The Rise of the Others

The new year began with the fine art auction market flush with cash but fraught with competition, reports Michael Hutak

In 2003 the great Australian art boom continued to gather pace with another $91 million worth of fine art changing hands in the saleroom - a 15.91 per cent increase on 2002 ($79.2) and an aggregate neatly split four ways between Christie’s, Sotheby’s and Deutscher Menzies and “others”, according to statistics compiled by the Australian Art Sales Digest. Tellingly, the biggest increase came not from the big three but in the crowded “other” category, centred mainly around players in Sydney. Swelled by a resurgent Lawson~Menzies (which actually recorded a better sale aggregate than Christies in the last round for 2003 in late spring), last year’s new comers, Cromwells, and the new old-money/new money partnership, Bonhams & Goodman, sales for the “other” category almost doubled in 2003 to $22.3 million, an aggregate representing more business than the entire auction market in 1993. That year it stood at a paltry $19.3m, in the days when “Christoby’s” pretty much split the blue chips among themselves leaving the potato chips for Leonard Joel’s (which celebrated 85 years in the business in March).

The year before, Sydney was big story. 2002 was the year Deutscher Menzies established their March sale in Sydney as a season-opening fixture on the calendar. It was when Sotheby’s cleared an incredible $7.9 million worth of Aboriginal art in June at their first foray into Sydney with indigenous art. And Cromwells, L~M, and Bonhams & Goodman embarked on a harbour city turf war which has made competition for quality stock fiercer than ever. In 2003 contemporary names like Tim Maguire and John Kelly were on everyone’s wish list, but it would prove to be the year of Russell Drysdale, who had four of the top ten highest prices achieved at auction, including the only picture to break the million barrier last year, The Outstation, sold by Sotheby’s in Melbourne in May.

Sotheby's, which topped the sales aggregates for the third year running with $27.3m, has made corporate dispersals the bedrock of its success, having managed sale of the Fairfax, BP, AXA and Kerry Stokes collections in the past two years alone. 2004 continues the trend with the planned March dispersal of the Western Mining Corporation Contemporary Art Collection, with an aggregate estimate of $806k to $1.2m. As to why so many corporations have shed themselves of art in recent years, Sotheby’s MD Mark Fraser told AAC the reasons are myriad: “Such things as share holder accountability; focusing on core activities when art is peripheral area; big increases in the value of artworks; secondary reasons can be a change of premises or a merger or de-merger of companies.” Naming Wesfarmers, Macquarie Bank, Westpac and ANZ as having the finest corporate collections still extant in Australia today, Fraser did say he knew of no major corporations that have started collections in the last two years. In fact several more firms have also sold off their collections confidentially with Sotheby’s through the saleroom.

Over at Christie’s, new paintings director, Jon Dwyer, would be happy with his first year at the helm, one which restored respectability to the French-owned firm’s local operations to post $21m in sales, a 64 per cent turnaround on 2002 revenue. The company had been haemorrhaging market share, living on the glory days of the $16m Mertz sale in 2000 – until Dwyer opened his account with a record $7.1m aggregate at last year’s May mixed vendor auction. 2004 couldn’t have begun better with Christie’s winning the plum business to disperse the contents of ‘Rona’, John Schaeffer’s landmark Bellevue Hill mansion. Shaeffer has compiled arguably the world’s finest private collection of Victorian and pre-Raphaelite art and is now in the process of selling off great chunks of it in order to shore up his exposure to the declining fortunes of his listed cleaning company, Tempo Services, (mooted in early March as a takeover target). Christie’s had plucked the Shaeffer sale out from under arch rival Sotheby’s, which had “limited success” last September in shifting the remains of Shaeffer’s once prized collection of 19th century and colonial-era Australian paintings for well below the low estimates. As Christie's sex it up to break the record as the biggest single vendor sale in this country, the proof will come, come April.

The appreciating Australian dollar however will have varied effects this year on the international market for Aboriginal art, where it will dampen foreign demand but entice foreign consignment of works held overseas. The latter effect is also expected to be felt in the wider market for Australian modernist and contemporary art. And Sotheby’s will have their first serious competition in indigenous art since 2000 when it met, matched and repelled Deutscher~Menzies’ fast and furious foray into the market. Both Christies and Lawson~Menzies have appointed Aboriginal art specialists, and the latter intends to conduct two sales a year of Aboriginal art. Shaun Dennison, a management consultant turned art expert, has been appointed to oversee Christie’s expansion in Aboriginal Art. While the party line has always been that the firm has “traditionally” not separated streams of modern and contemporary Australian art “ethnographically” and has instead incorporated Aboriginal works within the context of its normal seasonal offerings, Dwyer would “not rule out stand-alone auctions of Aboriginal art in the future”.

And at Lawson~Menzies, Cooee Gallery proprietor Adrian Newstead has come on board as Aboriginal specialist for a planned two-sales-per-year operation. CEO Paul Sumner has identified a new niche for his firm, after his art department was recently submerged into brother house Deutscher~Menzies in a bury-the-hatchet manoevre late last year that put an end to the dog-eat-dog competition between Rod Menzies two auction houses. Sumner hopes to head off finger-pointers with his announcement that L~M will pay two per cent of its normal commission on sales of indigenous works into a new foundation charged with donating funds to improve health and living conditions in Aboriginal communities. This move also offers Sumner the opportunity to denounce noises from Canberra that a resale royalty, as recommended by the 2002 Myer Report will be introduced into the Australian secondary art market. While it’s been generally acknowledged that a droite de suite in Australia will do much to support indigenous artists, the prospect of a what amounts to a new tax on collectors has many secondary market operators like Sumner in a lather. "We're trying to head it off," he said. "We think it will be a nightmare to administer and ultimately will only hurt the artists."

For his part Sotheby’s Aboriginal art guru, Tim Klingender says he supports a resale royalty and remains unfazed by his new competitors. Sumner, however, is in a unique position to know his rival, having been Klingender’s MD during the period when Sotheby’s was fending away Deutsher~Menzies challenge in 2000. And since taking over at L~M last year he has had the advantage of swapping notes with D~M’s Chris Deutscher about what went wrong. “I’ve seen both sides of the fence and I know what the processes are at Sotheby’s and I know what to expect.”

Klingender countered that he never comments on the activities of other firms… “especially that one!”.


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First published in Australian Art Collector

Art Market Notebook: Autumn 2004 -- The Rise of the Others

The new year began with the fine art auction market flush with cash but fraught with competition, reports Michael Hutak

In 2003 the great Australian art boom continued to gather pace with another $91 million worth of fine art changing hands in the saleroom - a 15.91 per cent increase on 2002 ($79.2) and an aggregate neatly split four ways between Christie's, Sotheby's and Deutscher Menzies and "others" according to statistics compiled by the Australian Art Sales Digest. Tellingly, the biggest increase came not from the big three but in the crowded "other" category, centred mainly around players in Sydney. Swelled by a resurgent Lawson~Menzies (which actually recorded a better sale aggregate than Christies in the last round for 2003 in late spring), last year's new comers, Cromwells, and the new old-money/new money partnership, Bonhams & Goodman, sales for the 'other' category almost doubled in 2003 to $22.3 million, an aggregate representing more business than the entire auction market in 1993. That year it stood at a paltry $19.3m, in the days when "Christobys" pretty much split the blue chips among themselves leaving the potato chips for Leonard Joel's (which celebrated 85 years in the business in March).

The year before, Sydney was the big story. 2002 was the year Deutscher Menzies established their March sale in Sydney as a season-opening fixture on the calendar. It was when Sotheby's cleared an incredible $7.9 million worth of Aboriginal art in June at their first foray into Sydney with indigenous art. And Cromwells, L~M, and Bonhams & Goodman embarked on a harbour city turf war which has made competition for quality stock fiercer than ever. In 2003 contemporary names like Tim Maguire and John Kelly were on everyone's wish list, but it would prove to be the year of Russell Drysdale, who had four of the top ten highest prices achieved at auction, including the only picture to break the million barrier last year, The Outstation, sold by Sotheby's in Melbourne in May.

Sotheby's, which topped the sales aggregates for the third year running with $27.3m, has made corporate dispersals the bedrock of its success, having managed sale of the Fairfax, BP, AXA and Kerry Stokes collections in the past two years alone. 2004 continues the trend with the planned March dispersal of the Western Mining Corporation Contemporary Art Collection, with an aggregate estimate of $806k to $1.2m. As to why so many corporations have shed themselves of art in recent years, Sotheby's MD Mark Fraser told AAC the reasons are myriad: "Such things as share holder accountability; focusing on core activities when art is peripheral area; big increases in the value of artworks; secondary reasons can be a change of premises or a merger or de-merger of companies." Naming Wesfarmers, Macquarie Bank, Westpac and ANZ as having the finest corporate collections still extant in Australia today, Fraser did say he knew of no major corporations that have started collections in the last two years. In fact several more firms have also sold off their collections confidentially with Sotheby's through the saleroom.

Over at Christie's, new paintings director, Jon Dwyer, would be happy with his first year at the helm, one which restored respectability to the French-owned firm's local operations to post $21m in sales, a 64 per cent turnaround on 2002 revenue. The company had been haemorrhaging market share, living on the glory days of the $16m Mertz sale in 2000 until Dwyer opened his account with a record $7.1m aggregate at last year's May mixed vendor auction. 2004 couldn't have begun better with Christies winning the plum business to disperse the contents of 'Rona', John Schaeffer's landmark Bellevue Hill mansion. Shaeffer has compiled arguably the world's finest private collection of Victorian and pre-Raphaelite art and is now in the process of selling off great chunks of it in order to shore up his exposure to the declining fortunes of his listed cleaning company, Tempo Services, (mooted in early March as a takeover target). Christie's had plucked the Shaeffer sale out from under arch rival Sotheby's, which had "limited success" last September in shifting the remains of Shaeffer's once prized collection of 19th century and colonial-era Australian paintings for well below the low estimates. As Christie's sex it up to break the record as the biggest single vendor sale in this country, the proof will come, come April.

The appreciating Australian dollar however will have varied effects this year on the international market for Aboriginal art, where it will dampen foreign demand but entice foreign consignment of works held overseas. The latter effect is also expected to be felt in the wider market for Australian modernist and contemporary art. And Sotheby's will have their first serious competition in indigenous art since 2000 when it met, matched and repelled Deutscher~Menzies' fast and furious foray into the market. Both Christies and Lawson~Menzies have appointed Aboriginal art specialists, and the latter intends to conduct two sales a year of Aboriginal art. Shaun Dennison, a management consultant turned art expert, has been appointed to oversee Christie's expansion in Aboriginal Art. While the party line has always been that the firm has "traditionally" not separated streams of modern and contemporary Australian art "ethnographically" and has instead incorporated Aboriginal works within the context of its normal seasonal offerings, Dwyer would "not rule out stand-alone auctions of Aboriginal art in the future".

And at Lawson~Menzies, Cooee Gallery proprietor Adrian Newstead has come on board as Aboriginal specialist for a planned two-sales-per-year operation. CEO Paul Sumner has identified a new niche for his firm, after his art department was recently submerged into brother house Deutscher~Menzies in a bury-the-hatchet manoevre late last year that put an end to the dog-eat-dog competition between Rod Menzies two auction houses. Sumner hopes to head off finger-pointers with his announcement that L~M will pay two per cent of its normal commission on sales of indigenous works into a new foundation charged with donating funds to improve health and living conditions in Aboriginal communities. This move also offers Sumner the opportunity to denounce noises from Canberra that a resale royalty, as recommended by the 2002 Myer Report will be introduced into the Australian secondary art market. While it's been generally acknowledged that a droite de suite in Australia will do much to support indigenous artists, the prospect of a what amounts to a new tax on collectors has many secondary market operators like Sumner in a lather. "We're trying to head it off," he said. "We think it will be a nightmare to administer and ultimately will only hurt the artists."

For his part Sotheby's Aboriginal art guru, Tim Klingender says he supports a resale royalty and remains unfazed by his new competitors. Sumner, however, is in a unique position to know his rival, having been Klingender's MD during the period when Sotheby's was fending away Deutsher~Menzies challenge in 2000. And since taking over at L~M last year he has had the advantage of swapping notes with D~M's Chris Deutscher about what went wrong. "I've seen both sides of the fence and I know what the processes are at Sotheby's and I know what to expect."

First Published in Australian Art Collector

Australian Auctions roundup, March 2004

After another record year in sales in 2003, the Australian fine art market has entered its second decade of sustained growth, still some people are never satisfied. When Deutscher~Menzies kicked off the 2004 season earlier this month with the highest grossing mixed-vendor sale of fine art ever held in this country – more than $8.4 million - it was greeted with either sublime indifference or churlishness at the failure of several high-value works by high-profile artists to sell, and of others to only meet the low end of the estimate set by the auction house.

One pundit dubbed the sale “a patchy start” to the year, pointing to passed-in works by saleroom favourites like John Brack, Norman Lindsay and John Olsen. Keen market watchers wondered if D~M had overestimated the strength of the top of the market, others saw instead "buyer fatigue" in the face of the runaway price inflation of some “top drawer” artists in recent years.

D~M’s national director, Damien Hackett, told The Bulletin his firm was “very concerned when high value items pass in, during any sale, but this can and does happen for many reasons, not just a weakening of the market… each sale is an individual transaction with its own specific circumstances attached.”

“With regard to John Brack,” said Hackett, “we had estimated Backs and Fronts ($450k to $550k) believing it to be one of the most important works to have come onto the market ever. The result, at $477,825, was in fact the fifth highest price ever achieved for a Brack. One important collector decided not to bid on the Brack, as he intended, because a family tragedy occurred a few days prior to the sale."

Hackett maintained the market for Brack remained strong, despite another work, The Club from 1989, passing in on an estimate of $230,000–260,000. He put the poor showing of other works down to “a number of clients who thought that some of the high value works would ‘fly’ and so did not enter the bidding. As a result, they were dismayed that they had missed out on things, especially the (Ian) Fairweather and the John Olsen”. Rather, the number of dealers buying, or under-bidding, on works in the $100,000 plus market meant “you would expect that (the dealers) are confident that there is more growth in the top end.” After $91 million in sales nationally last year, a 15 per cent increase on 2003, we guess they would be confident.

However one sector keen to get out of art quicksmart may offer the first tangible signs of a market reaching its tipping point. The great Australian corporate art sell-off resumed in 2004 with last week’s dispersal of Western Mining Corporation’s corporate art collection at Sotheby’s rooms in Melbourne. An aggregate of $1.28 million would have pleased WMC patriarch Hugh Morgan, the gross just pipping the high estimate for the entire sale. And with 21 new individual artist records – most notably for the late 20th century modernist, Leonard French, and moody Melbournite, Rick Amor - at least WMC found out they'd bought the right works. The clearance rate was an astonishing 98 per cent by lot.

Corporate sell-offs have become the bedrock of Sotheby’s market leadership in Australia: in the past two years they’ve flogged off the once-prized collections John Fairfax Ltd, BP, AXA and Kerry Stokes. Several other firms have sold off their collections confidentially through the saleroom, and Sotheby’s Managing Director, Mark Fraser says he knows of no major corporations that have started collections in that time. It will be interesting to watch for any moves by Wesfarmers, Macquarie Bank, Westpac or ANZ to liquidate their art assets. Fraser nominated these companies as having the finest corporate collections still extant in Australia today.

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Abridged version published in The Bulletin

Australia's Most Collectable Artists, 2003

Profiles written for "Australia's Most Collectable Artists, 2003" from Australian Art Collector Magazine.

Since the late 1990’s Garry Shead has shot into that pantheon of Australian modernist figurative painters who can command prices in excess of $100k. Son of a Sydney North Shore estate agent, Shead is privately influenced by the occult, and works in themes which can traverse several series over several years, taking inspiration from sometimes oblique corners of Australian culture: DH Lawrence’s time on the NSW South Coast, the 1954 Royal Visit by Elizabeth Windsor, and, most recently, the “Ern Malley” poetry hoax of the 1940s, which see him tackle ceramics for the first time – urns etched with poems by Ern! Championed as logical inheritor of the mantle of Boyd and Nolan, Shead quickly embraced the comparison in a recent interview: “Definitely… I like the story telling aspect of painting. I like to express in painting something that’s already there but hasn’t (yet) been done in visual terms.” Sasha Grishin, Head of Art History ANU, the author of several books on Shead as well as catalogue essays for the artist’s exhibitions, says Shead is now “painting at the height of his powers.” He believes Shead is “arguably Australia’s finest lyrical expressionist painter”, adding that his prices continue to grow dramatically. In 1993, the year he won the Archibald Prize, Shead sold just two works at auction for an aggregate of $693. A decade later and one of 39 works at auction included The Secret, which Christies offered with an $80k upper estimate. It brought a new artist record of $129,250 – a spectacular indication that supply is failing to meet demand.

Gordon Bennett
Queenslander Gordon Bennett went to art school in the late 1980s, where he openly embraced the postmodern positions of the time, a legacy still seen to today in a practice the artists describes as “conceptual painting based on the semiotics of 'style' and paint application, images and text, historical and contemporary juxta-position.” Of mixed Scottish, English and Indigenous Australian heritage, Bennett was brought up as a 'white' Australian and has only investigated his Aboriginal heritage as an adult. While issues of race loom large in his work he denounces the term “urban Aborignal” artist as racist, and prefers to be understood as an artist pursuing strategies of appropriation. Dr Ian McLean, who lectures visual arts at the University of Western Australia, is impressed with the long-term commitment Bennett has shown to his practice. McLean compares Bennett to another Aboriginal artist, Judy Watson, who are both “very different painters, but in less than 15 years each has produced an impressive and substantial body of work and built very successful careers as artists.” Says McLean: “Both found their feet quickly and now are at critical stages in their career. However they have demonstrated stamina, commitment and talent as artists, and so probably are yet to produce their best work.” Bennett is well represented in major state galleries but most works remain in private hands. A rare appearance at auction in 2002 saw Bennett achieve his current saleroom peak of $47,500 for an early 1993 canvas. Always the provocateur, his most recent show at Sherman Galleries, in August 2003, conflated camouflage and Islamic designs with ungainly portraits of Saddam Hussein.

ADS Donaldson
Profiled in issue #24 Of Australian Art Collector, this Sydney abstractionist has had a red letter year culminating in making our list for the first time. Donaldson’s select international following walked away with works from the Armory art fair in New York in March and then at Art Basel in June, the world’s most prestigious art fair. In April Donaldson collaborated with fellow artist Elizabeth Pulie for a show at Sarah Cottier’s now defunct Gallery, where he also exhibited 3 enormous large scale silver and blue paintings. Another show of hard-edge abstract paintings at Pestorius Sweeney House in August prompted Brisbane and AAC critic Rex Butler to write in The Courier Mail that "the issues signaled in this modest little suburban gallery will come to dominate the coming century of Australian culture – the battle between ‘Australian’ and ‘unAustralian’ ways of seeing ourselves." Commissions for Aldi and the City of Sydney and another group show at the Kunsthalle Palazzo, near Basel, followed. Already next year Donaldson has group shows lined up in Wellington, New Zealand in March and at the Ivan Doughety Gallery, as part of the Sydney Biennale.

Ian Fairweather 1891-1974
With a body of work estimated at just 500 major works, this Scottish born ‘citizen of the world’ is often acknowledged as one of the most important artists of the 20th century to work in Australia. Fairweather spend between the wars travelling throughout Asia and Oceania; living first in China, later in Bali, the Philippines and India, taking in creative and cultural influences as he went. He first visited Australia in 1934, and took a studio briefly in Melbourne after the WWII but wouldn’t settle permanently until 1952, when he moved to Bribie Island, north of Brisbane. There he became involved in the local indigenous culture and would become the first and perhaps only non-Indigenous artist to successfully incorporate Aboriginal art into his practice, where it joined with disparate influences such as post-impressionism, Chinese calligraphy and Cubism in the realisation of outstanding abstract paintings. Most highly regarded are the abstracts of the late 1950s, early 1960s but works from throughout his career are keenly sought. Many already grace Australia’s major state collections, as well as overseas at the Tate and Liecester galleries and the Ulster Museum, Belfast. Although saleroom prices have been steadily trending up in recent years [his current auction record of $255,500 came in 2000], there is still value and room for significant growth. “For one of Australia’s most important 20th century painters,” says Sotheby’s Chairman, Justin Miller, “his works still seem reasonably priced to me when compared to the million dollar plus prices paid for iconic works by other truly great Australian painters.” Drawings and watercolours, which are more plentiful, may be easier to come by.

Robert Macpherson B.1937
This Brisbane based conceptual artist is an unlikely “grand old man” of Australian contemporary art but with more than three decades of cutting edge practice behind him, that’s just what he is. Macpherson has become a regular feature on our list, first appearing in 1999. Michael Snelling, Director of Brisbane’s Institute of Modern Art, goes as far as saying MacPherson is “probably the most interesting artist working in Australia today, although he may well remain an artist's artist.” Snelling characterises the artist as “conceptually tough, viscerally mesmerizing and continues to make work that is both local and global - parochial and universal…” The broadening of Macpherson’s reputation became complete in 2000 with the major survey show at the Art Gallery of Western Australia, curated by Trevor Smith, recently appointed curator at the New Museum in New York. The show took over the whole bottom floor and some of the second at AGWA. “A scaled version toured to the MCA and looked just as impressive second time round,” says Snelling, “The catalogue was the best on an Australian artist seen here for many a year.” Macpherson was Australia's representative at the 2002 Sao Paolo biennale, and then in Face Up, backed by the Australia Council, at the prestigious Hamburger Bahnhoff in Berlin. Continues to be attractive to admirers of contemporary art, although works rarely surface on the secondary market.


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First published in Australian Art Collector magazine, Issue #27, Jan-Mar, 2004.

Collectables: Wolfgang Sievers

The art market has finally realised it can no longer ignore 90-year-old photographer Wolfgang Sievers, writes Michael Hutak

Collectors have been hearing for years that photography is "hot", and a stroll through any major international art fair will confirm that it has become the medium of choice, especially for younger contemporary artists.

Australia's art scene is overrun with snap-happy shutterbugs, with some, such as Tracey Moffatt, Rosemary Laing and Patricia Piccinini, making an impact in art world centres of gravitas such as New York, Venice and Cologne.

But do the sums match the hype? Is photography really a serious alternative for collectors looking to diversify away from, for example, the lucrative but monotonous trade in late-20th-century modernist painting?

"It is still possible to buy a good collection of photography for the price of a good painting," says Daniel Palmer, a critic and lecturer in the history of photography at the University of Melbourne. "But the real plus to emerge from the interest in artists such as Moffatt and Piccinini is that it has helped to establish traditional photography as a genuine collectable."

By "traditional", Palmer means "old-school" photographers such as Olive Cotton, Max Dupain, Lewis Morley or, as a case in point, the vastly under-appreciated 90-year-old Wolfgang Sievers, AO.

Born in Germany in 1913, Sievers studied at the Bauhaus and is revered as one of the most significant architectural -photographers to work in Australia, with many works in state archives, libraries and galleries. However, he has been ignored by the art market. Australian Art Sales Digest records show that in the decade to 2003, barely 10 works surfaced at auction, all selling for sums less than $1000. Or not selling at all.

Then, at Lawson-Menzies' Sydney auction in July, a 1959 silver gelatine photograph of a sulphuric acid plant in Hobart brought $2350 against an estimate of $900. The word was out by the time Sievers walked on crutches into Melbourne's Centre of Contemporary Photography to donate a 1986 print of a 1967 photograph for last week's charity auction to benefit the centre.

The auction, conducted by Christie's, was a runaway success, with 59 works by the cream of Australian photography garnering $79,360 for the CCP. Admittedly a paltry sum compared with the fine-art market but still vital signs of life for the 100 or so -collectors bidding at the sale.

And it wasn't a Moffatt or Piccinini that topped the sale but the Sievers, which fetched $8800 - an almost four-fold hike on the Lawson-Menzies sale.

-MICHAEL HUTAK

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First published in The Bulletin, 2 December 2003, Volume 121; Number 48

The Bulletin: Offshore artists come home to roost

If you want to know the most collectable emerging Australian artists, then look offshore first…

APART from Aboriginal art, which enjoys the support of both a thriving domestic and international market, Australia’s contemporary art market has been virtually hermetically sealed to foreign collectors: Australian contemporary art is almost exclusively collected by Australians, whether locals or expats.
This is despite the fact that most Australian contemporaries produce art which is international in terms of outlook and ideas, and lacks nothing in execution, ingenuity or inspiration when presented alongside the best international art. Yet barely a handful are well-known in the artworld’s hot spots like Manhattan, London or Cologne. In an age where artists have joined the ranks of celebrity, only Melbourne sculptor Ron Mueck, officially hot enough to be collected by billionaire tastemaker Charles Saatchi, has achieved anything approaching superstar status.
Yet tides can turn quickly and last week’s successful launch in Berlin of “Face Up”, an important group show of Australian contemporary art, added credence to recent claims that our living artists are starting to make a real impact in the international arena. Of course for Australians, acclaim abroad always resonates loudest at home, thus the canniest investors in Australian art today are looking for artists who are busy building reputations overseas.
A typical target is the postmodern painter John Young. Mid-career and on a roll, this Hongkong-born, Sydney-educated, Melbourne-based artist has just been picked up by a prestigious Berlin gallery, Pruess & Ochs. In the past year Young has had a sellout solo show with Sherman Galleries in  Sydney, and shows in Hong Kong, and Berlin, with yet another planned for next month at Anna Schwartz Gallery in Melbourne. Already in 2004 Young has solo shows lined up in Pirmasens in Germany, Sydney, Tel Aviv and even Bali. Group shows will take in Singapore, Beijing, Germany and Indonesia.
The auction market tells the tale. After barely a dozen works changed hands for small sums in the previous decade, at Deutscher~Menzies’ Sydney auction in March a work that cost $18,000 from Young’s 2001 show with Anna Schwartz sold for $32,900. Young’s dealers have crept up prices in the past year to $25,000 - $32,000 for an average-sized work to $60,000 for large works. Such sums are still quite low for European collectors, making work of Young’s quality a bargain, but they represent a trebling in the past five years on the Australian scene, and those who have been buying Young’s works for the proverbial song since the early 1980s must now be feeling very happy.
And perhaps a little vindicated.
 - MICHAEL HUTAK

First published in The Bulletin.

Collectables: John Young

If you want to know the most collectable emerging Australian artists, then look offshore first.

Apart from Aboriginal art, which enjoys the support of both a thriving domestic and international market, Australia’s contemporary art market has been virtually hermetically sealed to foreign collectors: Australian contemporary art is almost exclusively collected by Australians, whether locals or expats.

This is despite the fact that most Australian contemporaries produce art which is international in terms of outlook and ideas, and lacks nothing in execution, ingenuity or inspiration when presented alongside the best international art.

Yet barely a handful are well-known in the artworld’s hot spots like Manhattan, London or Cologne. In an age where artists have joined the ranks of celebrity, only Melbourne sculptor Ron Mueck, officially hot enough to be collected by billionaire tastemaker Charles Saatchi, has achieved anything approaching superstar status.

Yet tides can turn quickly and last week’s successful launch in Berlin of “Face Up”, an important group show of Australian contemporary art, added credence to recent claims that our living artists are starting to make a real impact in the international arena. Of course for Australians, acclaim abroad always resonates loudest at home, thus the canniest investors in Australian art today are looking for artists who are busy building reputations overseas.

A typical target is the postmodern painter John Young. Mid-career and on a roll, this Hongkong-born, Sydney-educated, Melbourne-based artist has just been picked up a prestigious Berlin gallery, Pruess & Ochs. In the past year has had a sellout solo show with Sherman Galleries in Sydney, and shows in Hong Kong, and Berlin, with yet another planned for next month at Anna Schwartz Gallery Melbourne. Already in 2004 Young has solo shows lined up in Pirmasens in Germany, Sydney, Tel Aviv and even Bali. Group shows will take in Singapore, Beijing, Germany and Indonesia.

The auction market tells the tale. After barely a dozen works changed hands for small sums in the previous decade, at Deutscher~Menzies’ Sydney auction in March a work that cost $18,000 from Young’s 2001 show with Anna Schwartz sold for $32,900.

Young’s dealers have crept up prices in the past year to $25,000 - $32,000 for an average-sized work to $60,000 for large works. Such sums are still quite low for European collectors, making work of Young’s quality a bargain, but they represent a trebling in the past five years on the Australian scene, and those who have been buying Young’s works for the proverbial song since the early 1980s must now be feeling very happy.

And perhaps a little vindicated.

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First published in The Bulletin

Collectables: Bonhams' Oz joint venture

A new joint venture aimed at grabbing a slice of the booming fine art auction market may struggle to get into the frame.

Breathless excitement greeted the news that UK firm Bonhams, founded 1793 and the world’s third largest auction house, will dive into the local market via a joint venture with Double Bay auctioneer Tim Goodman. “Our brief is to compete with the multinationals in this market,” said Goodman, targetting the world’s number 1 and 2 gavel bangers: NYSE-listed Sotheby’s and French-owned Christie’s.

Bonhams & Goodman have already opened new offices in Perth and Brisbane and Goodman has recruited no less than five former specialists from “Christoby’s” to kick start the venture.

Both Goodman and Richard Brooks, Bonhams’ UK chairman, cut their teeth in the collectible motor car trade. Goodman’s is already the local market leader in this area and also has a strong profile in jewelry and sports memorabilia. In the UK Bonhams’s strong suit is decorative rather than fine art.

Local skeptics doubt whether this latest foray by an international firm in the super-competitive, and now crowded Australian fine art market, can do much more than nudge the dominance of the “big three”: Sotheby’s, Christie’s, and the Australian-owned Deutscher~Menzies, which entered the market in 1998.

In the late 1990’s French-owned firm Phillips, de Pury & Luxembourg embarked on a similar quest down-under but failed.

Goodman argues that “the oldest firms are losing market share” in Australia, which is true but they have been losing it most spectacularly to D~M, owned by Melbourne cleaning tycoon Rod Menzies. And although the market itself has expanded to the spectacular tune of an average 10 per cent per year, the big three again have carved up the lion’s share.

According to Australian Art Sales Digest data, in 1992 almost $20 million in total sales of fine art was split roughly three ways between Sotheby’s ($6.9 million), Christies ($5.6m), and all “others” ($6.7m). A decade later, in a market now worth almost $80 million, and Sotheby’s ($23.5m) had increased sales four-fold, Christie’s ($18.2m) had more than trebled, D~M ($25m) had exploded in just five years, while “other” ($13.2m) had only doubled.

Goodman's still remains in the “other” category and while its annual "National Art Sale" has grown in 13 years to a respectable $1.75m in sales last July, the Bonhams joint venture will face stiff competition, not least on their home turf in Sydney from Menzies’s other firm, the new look, gung-ho Lawson~Menzies.

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Abridged version published in The Bulletin

Collectables: Rupert Bunny

Change in Tempo: Security and cleaning magnate John Schaeffer has gotten out of Australian art, but not quite while the going was good.

Schaeffer's sell-off last week of almost all his beloved Rupert Bunny’s, plus a couple of other out-of-fashion colonial-era artists was “a limited success,” says Sotheby’s Sydney painting’s expert, Geoff Cassidy. The sale draws a line under the greed-was-good 1980s boom in colonial and traditional art.

The fourteen lots fetched just AUD$1,016,700 - well below the low estimate for the sale of $1.5 million. Schaeffer and Sotheby’s were happy to offload most lots at below the auction house’s low estimate but the sale’s “hero” lot – Bunny’s 1985 Portrait of Jeanne Morel - failed to reach reserve and was passed in at $490,000. Schaeffer paid $500,000 for the work at the landmark Sir Leon and Lady Trout sale in 1989.

“The Trout sale was really the last big one-owner auction of the 1980s before the bust in the early 1990s,” says Cassidy. “Even though the market has well and truly recovered since then you’d have a lot of trouble getting the prices paid for most of those popular artists of the 1980s. The market is definitely moving towards the contemporaries at the moment, and it’s been difficult to sell top-end Bunnys for some time... We were quite happy to move them.”

Cassidy said that when Bunny was at the height of his popularity “John (Schaeffer) was driving the market quite hard and when you take such a major player out of the market it gets quite hard.”

Son of Melbourne Judge, Bunny (1865-1947) spent almost 50 years living and painting in Paris and even managed to get hung several times in the Salon of the late 1880s alongside the masters of impressionist painting. Bunny was a hot ticket in 1980s but in the last 10 years of the 327 works offered at auction 135 have failed to sell and of those more two thirds were offered – and rejected - in the last five years.

The sale was cannily marketed by Sotheby’s as merely a change in focus from Australian art to Schaeffer’s first love, 19th century English painting (he competes with Andrew Lloyd Webber as the world’s biggest private collector of Pre-Raphaelite Victorian art). This is no doubt the case for the super-wealthy, publicity-shy patron to the arts, but like any canny businessman the CEO of Tempo Services also had other reasons for the dispersal (don’t call it a fire sale!).

After a well-publicized split with his wife Julie last year, Schaeffer was forced to sell $7 million worth of his private-holding in Tempo’s stock. He told The Bulletin last November he would be selling off some of his magnificent collection to repurchase his holding.

"My love for this company is far greater than my love for my paintings," he said bluntly.

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Abridged version published in The Bulletin

Collectables: Art & Super Funds

Hanging offence: To hang or not to hang. That is the crucial question confronting today's super fund trustee, reports Michael Hutak

FINE ART has long been considered a legitimate asset class within the investment strategy of some of Australia's biggest superannuation funds. C+BUS for example, the building industry fund, counts its important art collection housed in regional galleries around Australia among assets of more than $3.5 billion.

But the most action in this area in recent years has been at the other end of the market, as private collectors rush to purchase art as part of their Self-Managed Superannuation Fund.

SMSFs have been the fastest growing sector of the super industry with approximately AUD$95 billion under management out of a total $530bn. The Australian Tax Office says SMSFs have grown by almost 25 per cent over the last three years to around 240,000 funds. It receives 1,000 new registrations each month and there are around 408,000 people with accounts, with an average balance of $234,000.

With the total secondary auction market in fine art in Australia at just $80 million per annum, the art trade understandably sees a great opportunity to grab a bigger slice of the estimated $10 billion that flowed into SMSFs during 2001-02.

The art market has a good story to tell potential investors: that $80 million already represents a quintupling of the auction market in just a decade. And headline-grabbing sales of telling of 100, 200 even 300 per cent returns for works by artists across all sectors of the market – traditional & modern, contemporary, and aboriginal art – make investing in art an easy, even sexy, sell.

Targeting the small investor, many galleries and art “consultants” are currently spruiking art in an SMSF as making “more sense than other assets in that you can hang it on your wall at home or office and have the visual pleasure of your own work of art.” One gallery’s web site even states: “It is a little known fact that it is perfectly legal to purchase investment artworks, acquired through your super fund, hanging on your wall at home.”

In fact this is not ‘little known’. It’s also not true. The big art-super push has hit a big snag called the ATO. “We’ve gone through this already with people trying to claim anything from Swiss chalets to Coles-Myer cards,” says Matt Frost, superannuation spokesperson for the ATO.

“The bottom line is yes, you CAN certainly invest in art for your fund, but when people ask us ‘can we put it on our wall’ the short answer is, ‘no you can’t.’”

Any investment for the purposes of a SMSF cannot contravene the so-called ‘sole purpose test’: it must only fulfil one purpose and that it is to provide a benefit on retirement. “And any investment that also provides any ancilliary benefit clearly fails the test,” says the ATO’s Frost.

Prominent Melbourne collector and art world accountant Tom Lowenstein isn’t taking the ruling lying down.

“I completely disagree with the Tax Office’s view and I’ve put a submission to them putting that case,” he told The Bulletin. “If the work has been bought for investment and fulfils the aims of the fund’s investment strategy then what does it matter where it is stored? My argument is the asset is just as safe on your wall at home as in storage, and is probably even safer.”

Lowenstein said cost of setting up even a small SMSF were not inconsiderable. With a modest investment of $100,000 “you’d still be looking at $2000 to $3000 in legal, accounting and auditing expenses. Add $5000 to $6000 per annum to insure and then store the works and you’ve probably wiped out any capital gains right there.”

Lowenstein argues, rather facetiously, that he is currently advising clients to either not hang their artworks, or to make sure they don’t enjoy them if they do. Which makes for a bizarre twist on an old adage: I don’t much about art but I know what I don’t like.

He predicts one of two outcomes to the controversy: “Either the ATO will back down, or it will be decided in the courts.”

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Abridged version published in The Bulletin

Limited edition Prince

Prince Harry's nascent painting career has got off to a less-than-glorious start, writes Michael Hutak.

Binge drinking, pot smoking, stealing sacred Aboriginal motifs – what's next for that right royal scallywag, Prince Harry? Third in line for the top job, 18-year-old Harry is what's known in the trade as a "spare", and with time on his hands, it seems the crazy young redhead now seeks to be known as "the prince formally known as artist". 

To recap, after Harry passed his A levels at Eton in June, the palace rustled up some publicity shots showing off the pictures he produced for his B pass in Art. Done in a faux-Aboriginal style with lizard motifs, the works showed Harry has a real future in the souvenir tea-towel industry. 

An obscure Portuguese gallery immediately offered £10,000 ($24,100) for the works, and London Aboriginal art dealer Rebbeca Hossack even offered him a show, suggesting the young pup "go out and see these lizards live and eat them", when he makes his sojourn down under for his "gap" year (reported cost for security to Australian taxpayers: £250,000). 

However Aboriginal art groups were not amused, branding the works "cultural theft" and Harry naive, ignorant and insensitive. Prominent Perth artist Julie Dowling charged Harry with "ripping off another family. His grandmother is the head of his church, he should show respect for other people's religions". 

The beat-up circled the globe, from The Guardian to Bahrain's Gulf Weekly. Harry's minders issued statements that he meant no offence, that he wasn't trying to pass off the works as Aboriginal, and that they certainly weren't for sale. 

Now that the paint has dried on the "furore", ATSIC's cultural commissioner Rodney Dillon is taking a more conciliatory approach. "We won't be taking any action or anything," he says. "We just hope that when he comes out here he visits some of the Aboriginal art communities to find out more about us and about why we get so upset when people do what he did." 

Dillon says cultural centres in the Northern Territory and Queensland had already decided to invite Harry to visit. "We'd be very interested in extending a hand of friendship. He's obviously very interested in Aboriginal art and that can only be a good thing. We think he could end up being a very good ambassador for us in England." 

Dillon says he'd received scores of hate email since the story broke, but "if we went round hating all the people that hated us, we'd be a bitter and twisted mob by now".

ENDS

First published in The Bulletin,

Collectables: Emily Kame Kngwarreye

The market aand experts differ on the value of early and late works by the legendary indigenous artist, Emily Kame Kngwarreye.

Undoubted highlight of last month’s bumper Sotheby’s Aboriginal art auction was the sale of the late great Emily Kame Kngwarreye’s 1991 canvas, Untitled (Spring Celebration).

Bidding on this sensual colour field of green, brown and yellow dots was the most competitive at the 560-lot sale, with four bidders on the phone and several dealers and collectors in the room vying for the prize.

The hammer eventually fell for a Swiss private collector who bid $463,000 – more than three times Kngwarreye’s previous auction benchmark, one of 17 saleroom records set for individual artists at the $7.4 million auction.

But what’s in a record? Are we to assume that this work was the pinnacle of Kngwarreye’s extraordinary achievement?

“These aren’t her best works in my opinion,” says Emily expert, Margot Neale, curator of Kngwarreye’s landmark 1998 national touring retrospective – the first ever for an Aboriginal artist.

“They’re very beautiful and there’s a quiet poetry about these early dot paintings,” says Neale. “But Emily didn’t pick up a brush until 1989, when she was in her late seventies. These works are only two years into her [eight-year] career," said Neale, now director of the First Australians Gallery at the Australian National Museum in Canberra.

“In my opinion Emily really came into her own with those looser, more gestural works of 1993-94, when she put all her verve and passion into it.

"She had enormous physical strength in her arms and hands from a lifetime of camel-driving and in the later works she really gives vent to that physicality on the canvas.”

The market begs to differ. But then the market judged at Sotheby’s corresponding sale in 1995 that a similar work to the new record breaker, Flowers of Alagura 1991, was worth only $2,300.

Meanwhile works from what Neale (and others) regard as Kngwarreye’s best period are still going for more modest prices of around $30,000 and up. Canny investors might look to what is called counter-cyclical buying and snap up these bargains while they last.

But, again, for those that buy for money there is always a downside – they will eventually have to part with a work of art whose aesthetic value is priceless.

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Abridged version first published in The Bulletin