Art Letter


December 2008 Archives

12/17/08

I've come to realize that art is a tool that can be used in so many different ways.

For years I've been talking to artists about the importance of having their art take care of their interests, be it money, career, legacy or personal growth.

Art has lots of purposes. It can be created and/or displayed for myriad reasons. But ultimately, Art is a Tool. If you are an artist, it can take care of you. If you are a viewer it can educate, stimulate, or placate you. If you are a patient it can soothe you.

And as collectors we have this amazing tool and asset that we can easily use to our advantage. This dawned on me like a hammer.

A few months ago I met Michael Mendelsohn, one of Art & Antiques' Top 100 Collectors who has a legal, tax and philanthropic background. After a number of conversations with him it struck me that it is vastly important that collectors, especially those with collections worth "real" money, enable their collection to take care of them.

A solid art collection, or a collection of any sort that has genuine value, is an amazing asset whose worth is invariably overlooked. Most collectors I know think of the collection's worth passively. They know the collection has a monetary value but they typically aren't honoring it, using it or enabling it to take care of them.

Let's say your collection is worth a half million dollars -- or more. And let's say you die. The law says your estate needs to be settled within 9 months. I know you have a will, or a living trust, but did you include your art in those documents? Or did you just assume that your kids are going to want it? (Most kids don't share our taste and are more interested in selling the art than keeping it. Ask them.)

Odds are that once you die your art is going to be sold to pay estate taxes and/or to take care of your heirs. Without a thorough plan in place, your lawyer or someone else your executor trusts is going to tell your heirs to just put the art up for sale at Sotheby's or Christie's. A valuable collection, nine months to sell, a downturn in the market, commissions, fees, estate taxes and you're going to be lucky to pass on 20% of the value of your collection.

That's dreadful. You spend a lifetime building a collection, a labor of love, passion, research, pride and personality and you're going to dilute that to the tune of 80%? Excuse me for being blunt, but that's not very good -- at all -- especially when you consider the alternatives. Like being able to keep a minimum of 80% to perhaps as much as 500%. Think about it.

Wouldn't it be wiser to document your collection, create a database, identify which pieces are the most significant and why, explore issues of provenance, consider its ability to enhance your legacy and use it to get you what you want?

Do you want it to generate $10,000 a month of income? You could. Even more. How about current gifts to heirs and charities? Or a trust for the art. Or sell part and donate part of your collection to your favorite museum. You get money; you avoid taxes. The museum gets art they want at a reduced cost and everybody wins.

Long range options may include innovative post-mortem sales, distribution to heirs, gifts to charities and the creation of a family art legacy.

If you act while you're alive you can create trusts, remove the art from the estate, generate income, buy life insurance, travel your art to museums, build a legacy, give to charities, take care of your children and die with a smile on your face because you've become a philanthropist instead of just a taxpayer.

I mentioned Michael Mendelsohn at the beginning of this article. I was so moved by how he is empowering collectors, enabling collectors to be benefactors of significance, instead of just taxpayers, that I've joined forces with him. I am now part of the
Briddge Group. Mendelsohn has been doing this for going on two decades. He knows incredibly well how to shed new light on a major asset that might as well have been hidden in the closet for all the good it's done.

With Michael Mendelsohn and the team he's created, we have experts on all facets of the art and collecting world. We focus on the one asset that has been the most overlooked, fulfill the collector's wishes and aspirations, and work closely with his or her existing advisers.

I get to see fabulous art and work closely with some special people. Our art will outlive us. We have an obligation to do it justice -- to preserve and protect it and its integrity for future generations. Selling it at auction is like scattering it to the wind. Odds are that isn't why you assembled something so personal, significant and valuable.

To be able to aid your favorite museum or charity, to be able to help others, to leave behind something inspirational is beautiful and possible.

Perhaps you can tell, I find this very exciting. We've got lots more information, papers, and books available. Email me if you want to know more. Ask me about The 10 Questions Every Collector Should Ask. It doesn't cost anything to get started.

Art is Long; Life is Short,
Paul Klein


12/10/08

It worked out that I got to be in Miami for the art fairs last weekend.  And though I didn't manage to get everywhere I did get the pulse.



In years past I've found the
Art Basel/Miami show to be progressively more commercial every year - to the point that I found it offensive - or at least in bad taste. This year I was impressed by the mood. It felt like art fairs from a decade ago.  Lots more discussions about the art.  Lots fewer immediate sales. More considered discussions. More discounts.






The dealers had reduced expectations and across the board felt it was better than they expected. This provided a positive mood to the fairs, and to Miami.  The buoyancy of the art fairs had come to town.  Culture mattered for a few days. 
A Miami Herald survey of dozens of exhibitors at the Basel show and surrounding fairs found only 16 percent seeing sales growth, while about a third said sales were flat with two more days to go.  Nearly a fifth of the galleries surveyed reported sales down at least 30 percent compared with last year. The accompanying editorial suggested this was bad. It sounds damned decent to me.






I enjoyed seeing a lot of Chicagoans participating in a larger context.  Most impressive were
Kerry James Marshall's and Nick Cave's installations at the Rubell Collecton's exhibition 30 Americans.







At the
Margulies Warehouse was a weighty exhibition of Sculpture.  Big pieces in a big space.  I responded to the scale, points of view and pairings.

  




 
I heard insightful discussions.  With the recent hyperbole and corresponding inflation of prices at auction, a new level of 'gamesmanship' prevailed.  Artificial. With the economy on tilt those players are gone. But that doesn't mean all collectors are gone. Replacing the upper echelon are the more genuine collectors who were pushed aside 10 years ago. I saw
the Vogels at the fair.

I was told that the significance of the financial turmoil is highlighted in the financial markets of a communication center like New York.  However, the story goes, that it is not so bad in Hollywood, that contracts are booked months in advance, and that it is not all that bad in Europe either and collectors from there are taking advantage of smaller art at good prices.

It felt good to me.

There are some fun art events to check out this Saturday.  During the day,
Tony Fitzpatrick is having his biannual (every two years) studio sale.  This is a helluva opportunity.  And Saturday night is ThreeWalls Annual Holiday Ball. Use the link this is not at their usual space. A fabulous list of artists have donated work. (I'm torn here.  I'm on the board of ThreeWalls. I want you to support it,  But I get a better price on the art if you don't go.)  I hope to see you there.

Thank you,
Paul Klein

 


12/03/08

I asked those who receive my ArtLetters to grade Chicago's institutions that exhibit visual art. Here are the fascinating results. Thank you for participating.

The most votes were cast for:
   1. 
Art Institute of Chicago
   2. 
Museum of Contemporary Art
   3. 
Chicago Cultural Center (the top 3 were essentially a tie)
   4. 
Smart Museum
   5. 
Hyde Park Art Center
   6. 
Renaissance Society

The fewest votes were cast for:
   1. 
Cervantes Institute
   2. 
Sullivan Galleries of the School of the Art Institute (new)
   3. 
Little Black Pearl
   4. 
McCormick Freedom Museum

The highest grades were for (B or higher)
   1. 
Chicago Cultural Center
  2/3 
Oriental Institute
  2/3 
Smart Museum
   4. 
Art Institute of Chicago
   5. 
Hyde Park Art Center
   6. 
National Museum of Mexican Art
   7  
Museum of Contemporary Photography

The lowest grades were for: (D or below - - - perhaps more votes here would have made a difference)
   1. 
Cervantes Institute
   2. 
Southside Community Arts Center
   3. 
Little Black Pearl
   4. 
DuSable Art Museum
   5. 
Chinese American Museum of Chicago

The most controversial (those with the most range) in the votes were:
      
Renaissance Society
      
Museum of Contemporary Art
      
Chicago History Museum


The Institutions and their scores: (A=4, B=3, C=2, D=1)
  
Art Institute of Chicago 3.17
   Arts Club of Chicago  2.59 (No Website)
  
Balzekas Museum of Lithuanian Culture 2.20
  
Beverly Art Center   2.44
  
Block Museum   2.91
  
Cervantes Institute  1.60
  
Chicago Cultural Center 3.40
  
Chicago History Museum 2.93
  
Chinese-American Museum of Chicago 1.88
  
Columbia College galleries 2.71
  
DePaul Art Museum 2.52
  
DuSable Museum   1.86
  
Elmhurst Art Museum 2.56
  
Evanston Art Center 2.38
  
Field Museum 2.96
  
Gallery 400 2.50
  
Governor's State Sculpture Park   2.50
  
Hyde Park Art Center 3.09
  
I Space 2.56
  
Illinois State Museum, Chicago 2.90
  
International Museum of Surgical Science   2.46
  
Little Black Pearl 1.77
  
Loyola University Museum of Art  2.19
  
McCormick Freedom Museum 2.20
  
Museum of Contemporary Art 2.50
  
Museum of Contemporary Photography 3.00
  
Museum of Science and Industry   2.98
  
National Museum of Mexican Art 3.07
  
Oriental Institute 3.25
  
Renaissance Society  2.74
  
Smart Museum   3.25
  
Smith Museum of Stained Glass 2.67
  
Southside Community Arts Center   1.70
  
Spertus Museum 2.75
  
Sullivan Galleries 2.95
  
Ukrainian Institute   2.42
  
Vietnam Veterans Art Museum 2.53


Thank you,
Paul Klein