Last week (September 7-29), Christie’s Swiss Art Auction included two works sold by Unicredit, an Italian bank. Lot 10, a sculpture by Jean Tinguely, fetched CHF75,000 ($82,552) which the bank says will help fund its Social Impact Banking initiatives.
Few noticed the niche auction, which was held online. The majority of the works were sold by private collectors. But little by little companies, and especially banks, are silently selling corporate art collections that have been built up for many years.
Deutsche Bank, which holds one of the largest corporate art collections in the world, is reducing it by 4,000 pieces, said Friedhelm Hütte, director of Arts Deutsche Bank. “The number of branches is decreasing more and more,” he says. “It had an impact on the collection. The idea of our collection has always been art in the workplace.”
The German bank has closed more than 500 branches as the bank goes digital and has just rolled out a new “hybrid model” allowing employees to spend more time working from home.
Fewer offices and bank branches equals less wall space for artwork.
Or, in the case of British Airways, it’s not the wall space that’s missing, but the customers. In July, the airline sold an art collection gathering dust in empty first class lounges for £2.2 million ($2.9 million).
Thomas Cook, a travel company, also needed funds and recently parted ways with a 3,000 year old Egyptian statue for £150,000 ($195,251).
Many companies are asking similar questions: team meetings, client meetings and even board meetings are now taking place online. Even magic circle law firms, notorious for keeping workers at their desks for long hours, are embracing new work-from-home schedules.
Some banks, like Deutsche Bank, were emptying their offices even before Covid-19 arrived. Others, including Schroders which expects to complete the sale of its headquarters, have introduced new work-from-home plans.
In London, where most of these firms are based, the amount of office space available for subletting has jumped 21% since June according to CoStar, a commercial property data company. Less than half of Britain’s workforce had returned to their desks before Boris Johnson said in September that he was “again asking office workers to work from home if they could”.
What all of this means for art collections is still unknown, but it doesn’t look good. None of the major auction houses have held a major corporate art sale since British Airways, although several industry players say they have carried out appraisals.
Why selling art is a bad look
But selling art is not a good idea for businesses. Few images better capture a bank eating a humble pie than the Lehman Brothers sign carried through Christie’s auction house.
Then there was Abraaj, the private equity group that amassed $1bn in bad debt but kept a £4.7m ($6.2m) art collection, Sold by Bonhams in 2018. Companies are wary of the image this presents.
Instead, many choose to unlock value in their art collections by lending against them, says Harco van den Oever, founder and CEO of Overstone, which helps businesses and individuals do just that.
“What we saw was that between early and mid-March there was an explosion of inquiries from potential borrowers,” says van den Oever. Even then, however, only “the most extreme cases” were selling artwork, he adds.
Patrick McCrae, founder of ARTIQ, agrees that few sell: “There have been one or two but these are customers who have had more difficulties.”
McCrae says he has helped some clients sell their collections, but his business lending artwork to offices has mostly gone well. “People are definitely not going to the office at the moment, but I wouldn’t say we’re seeing a massive drop in client rental collections.”
Wokeism sees old masters
If art is to stay on the walls of offices and airport lounges (and some are), don’t expect to see Old Masters. Unicredit says it wants to “replace masterpieces sold with works by young and emerging artists”.
Deutsche Bank is preparing to increase the “contemporary quality” of its collection. “So we will have fewer prints and graphics and more original designs,” says Hütte. Last year, the bank sold Gerhard Richter’s Faust painting that hung in its old Wall Street lobby.
“It’s part of our marketing. It’s part of our customer relations, so we use it a lot for customer relations and talking to customers,” says Hütte.
Increasingly concerned about their image and their brand, companies want art that gives the impression of being inclusive and avant-garde, whether or not this is the reality.
“It’s to make a place beautiful,” says McCrae, who loaned a series of works to Hiscox, the insurer, called Queer Frontiers. “It was an opportunity for them to highlight their inclusion.”
Likewise, Mayer Brown, the law firm, has a collection of female artists to show “the passion and commitment to promoting diversity in the sector”, and UBS, the Swiss bank, commissioned Annie Leibovitz to create WOMEN: New Portraits.
The domino effect of this is playing out in the art world. Many companies support young artists through such exhibitions. Banks, including Deutsche Bank, UBS and Unicredit, fund prizes for emerging talent and, despite everything, still buy their art.
Artists therefore need workers to return to their offices in order to be able to return to their workshops. And the sooner the better.