Foto: Tomáš Železný
With some creative investments however, investors may find the immeasurable added value in possessing an asset with genuinely personal significance.
With contemporary and conceptual art, it is imperative to understand the artists’ process and thinking to begin to read their creations. When somewhere in this creative process the viewer, or participant, feels an inspirational or common thread of perception it becomes something very personal.
Director and co-founder of the Dvorak Sec Contemporary (DSC Art) art advisory and consultancy Olga Dvořák says that this link is exceptionally important for those interested in art investment. “The first thing about art investing is that you should fall in love,” she told CBW. “If you fall in love, you could find something that is really tailored to your taste.” DSC was founded in 2008, and Dvořák has been bringing young artists primarily from New York City to the Dvorak Sec gallery in Prague and focusing her advisory on these modern, up-and-coming New York talents. She explained that New York is still the one of the most dynamic contemporary art hubs in the world. “People [in Prague] are … a little bit conservative, a little bit shy … unfortunately the Czech art is not as strong and they put so much money into the Czech classic modern but if you see the results of the auctions in New York and London there is not such a big resonance of the Czech art.”
Dvořák says that her clients are aptly falling in love with the young New York art and forging this relationship is one of the aims of her advisory and gallery.
Q: Why invest in art?
A: If you fall in love with art, then you go to Madrid and you never miss [going to] the big museums, El Prado, you go to New York and you always go to New Museum and the Guggenheim, so it is a part of a style. Then if you could afford to collect, this is something that is sort of an interesting message, for example, for your [future generations]. … If I have this on my wall, my granddaughter can think ‘who was my grandmother if when she was 30 years old she had this on her wall.’ This is something that gives a message, like books, if you have books from your mother, father, grandmother, you can find a style in how they thought. So this is the emotional part of it. For the investment part—it could be diamonds, it could be old cars—I think [art] is part of the assets you could choose as an investment. … You love it, you live with the art. Everything that you buy loses its value. … If you come with your new Mercedes from the factory it is directly minus 40 percent value. Only art [retains its value].
Q: Could you tell me more about how to find good investments?
A: What we are doing, what the gallery is doing, is we are going only to New York. So for us it is important to have an artist who lives in New York. Why? It is sort of a trouble to be an artist in New York—everything is expensive, there are so many artists and big competition—but the history of art and the good galleries, the good curators and the good museums are there so if they find you … it will be always in New York.
The artist should have a very good university … and you can find who their professors were. For example I had one collector and his collection was for his young son. We were at a fair three years ago and he liked this photo and [the seller] was asking €36,000 [Kč 925,000]. … If it is only Kč 5,000 and it is a student and we like it, we just buy it. But in this situation you really think. My job was finding out that the artist is in galleries in New York, in a very good gallery in Zurich and she was studying under Thomas Ruff, one of the three most important photographers in the world now. She already had exhibitions with Professor Ruff, twice, so he definitely wants to promote her also.
Now, this past summer galleries were calling me from Zurich asking if I could ask my collector to resell this photo—there are 10 originals and they are all sold—for €100,000. He wasn’t selling it, but he likes the feeling of choosing the winner, somebody who grows. This is the passion with art investment.
Q: Do most of your clients come to you with an idea of what they want?
A: We work with them sometimes for two years. Very often we go to art fairs and my only duty there is asking please, don’t buy it. It’s easier to buy than have money in their pockets. In the art fairs you can imagine this atmosphere; there is everything and thousands of galleries. If you are buying only because you like it and you are a beginner, a new or young collector, then you have to breathe a little bit and think: ‘what is the art, what is the artist, what is the gallery?’ When I am at the art fairs with my client and they want to buy something, I am asking the gallery what other art fairs they are going to, what is their future, what is their past—how will they promote the artist when my client will have this artist in their collection. It means how they will give a value to the art that he is going to buy now, in the future. … There are so many technical things that you have to consider.
For the very first consultation for the collector, somebody comes and says I would like to start but I don’t know how. The first question we ask is how strongly encouraged are they to go into the young art with the bigger potential of risk and how conservative are they. Let’s say the collector says 50/50 or 70/30 … we then create a collection which has some ideas, not only a group of art but something with [themes] for example, another country, another object, interior, there are some artists in the same generation, same idea. … Contemporary and conceptual art is so difficult, you have to know the concept, the idea behind it, and it’s not enough to just see it. So it’s so difficult and the people are extremely busy … so the gallery is helping them to bring a good creative team.
Q: Do you see the Czech contemporary art scene as something that could be interesting for collectors? Are there already some artists that are standing out?
A: There are. The young Czech artist knows that they should go to London for a year, they should go to New York. So now, I am sort of a little bit optimistic but what’s going on with these old classic Czech artists from the 1920s or so—collectors don’t want to hear it. Some of my collectors are selling their [Václav] Špálas or [Emil] Fillas and others because buying it now at the auction is being at the bottom of the trends. … For example I was recently doing a fantastic art exhibition in [international auction house] Sotheby’s, when I said Filla or Špála, they didn’t know them.
Q: What about current Czech contemporary artists?
A: There are some, three or five, that should be a good investment. If you love it, it is OK. And it is still very cheap. … In the Czech Republic there is still undervalued art.
Q: Approximately how much would it cost for a piece from, for example, a young New York artist from a good school and with potential?
A: It is very transparent. When the artist comes from a [good] school, it is a painting maybe 1.5 m x 1.5 m, and he doesn’t have gallery representation it is about $2,000 (Kč 38,000/€1,500) to $5,000. … What are the [requirements] for our artists that we recommend: the artist is from a very good school, is three to five years out of school with group shows or other shows in [New York-based contemporary art museums] P.S.1, MoMa, Flag Art Foundation or Jamaica Center … a very good institution, a ‘white column’ institution, for example a nonprofit institution but with very good credit, and the artist doesn’t have gallery representation. [During] the financial crisis the galleries are cutting the [younger] artists that they had. … For example, a gallery in New York has seven artists and they drop the younger two and stay with the five who have already spent five or 10 years at art fairs and they invest only in these artists’ careers. So there are so many good artists now without gallery representation. So this is our strategy. … If this mixture is OK, then everything else is only bonus. …
The better the exhibition the artist has, the better the price. … In three or four years with gallery representation it is usually double or triple the price. … Then for example he gets some award and goes to some Biennale and then again he triples the price but it is sort of logical how it goes. … Because we are going directly to the ateliers of the artists we don’t have this triple or double gallery price and we are able to find it at very low prices. … It is also the risk that [the collectors] know they pay less but they don’t have this security with having art from somebody with a gallery already caring for the career. But for example Dana Bell was having a flirt with Winkleman Gallery in [New York City neighborhood] Chelsea but with the tough situation with the financial crisis the gallery told her sorry, I don’t have time. After having the show here in Prague, she went there again and the gallery said ‘oh you already have representation in Prague come on maybe we could speak.’ So it was this factor.
Q: How has art investment been influenced by the financial crisis?
A: Very strongly. … For example one year in an evening auction in Sotheby’s, the whole amount of money from items sold in one auction was $380 million. One year after, it was $127 million. … A second influence of the financial crisis is that the auction houses are not selling so much. They are a little bit more conservative and they don’t take younger artists. Before the auction they need to have a minimum of two buyers before they put the piece into auction.
Q: What about for your business here in Prague?
A: People are thinking more about the money but they know that art is a beautiful investment. It’s not more trouble about the price. They say don’t speak about it because it’s art, it’s something between earth and heaven, it’s something so emotional, it’s not connected with speaking about the money. … It’s a pleasure having your money invested in something you can see.