Art Market Blog – Profiting from the Rush for Russian Art
To say that the political and economic history of Russia is tarnished would be putting it nicely but their rich cultural history seems to have been one of their saving graces. Unfortunately due to the economic difficulties that Russians have experienced in the past many valuable Russian artworks and antiques have been in the hands of people outside Russia but this is starting to change. With a booming economy fuelled by the world’s hunger for Russian oil, gas, metals and minerals the fortune of Russians is rapidly turning to the point where there are now more Billionaires in Russia than in England and property prices in Moscow are some of the most expensive on the planet.
Although the Russians can’t rectify their political and economic history they can reclaim, preserve and promote their fantastic cultural heritage by using the wealth that they have acquired to buy back the important works of art that have until now been in the hands of collectors and investors outside Russia. Over the last ten years the value of Russia art has increased a staggering 589% resulting in the first ever all Russian art auction taking place in 2004 which was also the year that Macdougall Auctions, the only fine art auction house to specialise in Russian art, was started.
According to their website “MacDougall Auction House was established in 2004 by art collecting couple Catherine and William MacDougall; it specializes on Russian art, from icons to contemporary. In addition to its London base, it has an office in Paris, and was the first foreign auction house to have representatives in Moscow and Kiev. In June it opened new auction rooms in 30A Charles II St, off St. James Square, London”. Specialising in Russian art has paid off for Macdougall Auction House (http://www.macdougallauction.com) with their recent Russian post war and contemporary art auction trumping the big boys with US$5.9 million dollars worth of works sold which is a world record for this sector of the market. Further demonstrating the strength of the value of Russian art is the Aurora Fine Art Investment fund which was started by the Russian mining and oil billionaire Viktor Vekselberg and invests primarily in Russian works of art.
With a relatively short period of time since the traditional religious icon paintings gave way to the influences of modern art there are comparatively few works of modern Russian art available which although is a good thing for the value of these works raises questions as to whether an auction house devoted to Russian art will be sustainable in the long term. It is not as though the Russian’s will be quickly reselling their works to make a profit as they are more interested in the prestige of owning a valuable work of art and owning a bit of their cultural heritage than the financial gains that can be achieved. The wealthy Russian buyers of these works will either be donating them to galleries or keeping the works in their collection for a very long time which means that the supply of works on the market will continue to dwindle. For this reason I predict that the value of Russian works of art continue to rise and that contemporary Russian art will be a highly profitable and popular sector of the market once the Russian contemporary art scene expands and matures.
**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications.