Contemporary art of investment takes root
Written by : Ooi Sue Hwei
Malaysians are viewing art as an investment vehicle with promising potential as the works of local artists garner popularity beyond our shores
INFLATED property prices and a volatile stock market have left fewer investment opportunities for those with a little bit of spare cash. However, savvy investors who are looking for more exciting returns have found a creative and artistic avenue to grow their funds in recent years.
According to Polenn Sim, a project director with Art Expo Malaysia, art collectors in the country are increasing. and many of them are in their 30s. They choose to invest in art portfolio by collecting artwork by upcoming artists.
Chris Tay, general manager of Henry Butcher Art Auctioneer, shares the sentiment. “I see a growing number of young people investing in art in the past five years. We have clients from as young as 16 years old up to over 80 years old. The highest demand is for artworks priced less than RM10,000. Those under 30 usually go for art that is priced under RM 20,000, with a closer affinity for contemporary works as they are more affordable and are value for money”, he says.
Judging by the growing number of young people at art auctions, such investments seem to be paying off. “Art is really subjective and its value can fluctuate wildly. For collectors who buy artworks from the right artists, the work can increase in value between 5% and 20% within a year, and even as much as 50% in exceptional cases “, Sim says.
One of the main factors driving this growth is the birth of several auction houses in the past four years(see Table 1). The pioneer was Henry Butcher Art Auctioneers which held the first art auction in Malaysia in 2010. The response from the public for the secondary art market was overwhelming due to pent-up-demand.
2010 -Henry Butcher Art Auctioneers is the first art auction to set up in the country
2012 – KL Lifestyle Art Space opened
2013 – Masterpiece Auction, which focuses mainly on Indonesian art, was set up
– The Edge Auction was set up
In 2012 and 2013, Henry Butcher Art Auctioneers recorded sales worth a total of RM8 million and RM7.8 million repectively. Last year, about 95% of the artworks up for auction were sold, and half of these were sold at prices above the initial estimate price.
“Last year alone, about 10 auctions were held in Malaysia. So, if each auction sold about 60-70 pieces of art, then last year an estimated 600-700 pieces of art were sold. That’s a lot of work being sold in Malaysia in just one year” Tay says, adding that the number of art auctions that will be held this year is expected to increase.
Another indication of the rapid development of the art industry comes from total sales figure at Art Expo Malaysia, which has undergone explosive growth in the past four years (see Table 2). The growth momentum for this figure is expected to maintain.
Value of paintings sold at art exhibitions
2007 – RM 2.3 million
2008 – RM 5.3 million
2009 – RM 5.6 million
2010 – RM 11 million (including artwork by Andy Warhol, father of pop art, worth RM 2 million)
2011 – RM 13.5 million
2012 – RM 17.2 million
2013 – RM 19.3 million
Quantum jump in value of artworks
Modern vs contemporary art
Art collectors can generally be divided into two main categories. Firstly, there are collectors who mainly invest in young artists. The risk here is, if the young artist gives up, the work will no longer appreciate in value as the artist has stopped his artistic journey.
Then there are those who prefer to buy more established artists who have created their own profiles, including the number of exhibitions they’ve participated in, locally and abroad, and the number of awards they’ve won.
The artwork of young local artists are usually priced at a few thousand ringgit. However, in countries like Japan, Singapore and South Korea, the price for artworks produced by young artists are generally higher as their societies have a better appreciation for art. Sim says young artists from China who just graduated can command a few thousand or even tens of thousands of ringgit for their work.
Many in the industry agree that the art movement in the past five years has mainly been driven by contemporary art. ” Before that, nobody really bothered to talk about art. However, that changed when contemporary art galleries began to mushroom everywhere ” says Scarlette Lee, owner of Core Design Gallery , adding that in the past two years, more than 20 galleries have sprung up in the country.
The most expensive piece of art was one by Datuk Ibrahim Hussein which was sold for RM 800,000 by Henry Butcher Art Auctioneers. Lee points out that, although modern art still commands a higher price tag, contemporary art has been experiencing a quantum jump in terms of value. “Just a decade ago, contemporary art was generally selling for between RM 3,000 and RM 5,000 , with the highest going up to RM 10,000. The price today for artworks of the same size would be around RM 50,000 to RM 60,000. That’s a huge jump”, she says.
Lee explains that contemporary artists are particular about quality, presentation, skills, effort and composition of their art pieces. Most importantly, they don’t want to associate themselves with the overproduction of art.
One example is Husin Hourmain, a contemporary calligraphy artist who took three years to complete a body of works, priced between RM 18,000 and RM 30,000 each, were well received even by non-Muslim collectors and have seen 20%-30% increase in value since they were first showcased early last year.
Paintings by Hamir Soib, another contemporary artist, are very much in demand because he only produces three paintings a year. One of the most well known is a 12ft by 5ft painting which sold for RM 150,000. Called The Auctionland, it is a 2013 acrylic and bitumen on canvas painting of a large koi fish in a lateral view.
” Today, contemporary artists are no longer desperate to sell their work, they would rather focus on quality. Buying art is not about buying a beautiful picture, it’s buying the intellectualism behind it ” says Lee, who considers Shooshie Sulaiman one of the top contemporary artists in the country.
That’s one reason why Art Expo Malaysia will showcase more contemporary art this year. In 2013, the ratio was 60% modern art, 25% contemporary art, while the remaining is for traditional art and the remaining is for traditional art and others. This year, however, Sim plans to dedicate up to 40% of the floor space to contemporary art due to the growing number of contemporary artists and the higher demand for such art pieces.
Sim observes that there has also been a change in the mindset of the parents of today, with the establishment of more local art institutions, he believes that the younger generation are beginning to embrace the idea of having an art career. Even more heartening is the fact that Malaysian art is now in demand by collectors from outside the country.
Lee concurs, saying : ” I have collectors who were only collecting artworks of non-Malaysian artists in the past. However, that changed when I introduced them to Malaysian art. They realized that our artists have a cultural identity that is truly on par with international standards”.
Tay foresees that in the next five years, although there’ll be even more art buyers, the number of works being sold that have never been seen before or fresh to market would become increasingly rare.
“Some people feel that the real collectors are still holding on to their best prices. Perhaps in five to 10 years, they may slowly release their collection when there’s further expansion of the art market and increasing interest in Malaysian art from outside the country”, he says.
Tips for art collectors :
- Collect artwork by artists who have developed a strong profile
- Collect artwork by artists who have mastered basic techniques
- Collect artwork by artists whose technique is easily recognisable, with their own style and expression
- Identify and collect the most important series among the artist’s artwork
- Do your homework and check auction records for the prices of similar artworks (compare artworks of similar sizes or from the same series)
- Visit more art expos and speak to gallery owners of the artist themselves
THE secondary market for Malaysian artwork was almost non-existent before the first auction house was set up in 2010. Since then, the growing demand for Malaysian art has inspired a small number of shrewd opportunists to forge paintings by local artists.
However, Chris Tay, general manager of Henry Butcher Art Auctioneers, believes there are only a handful of such cases and usually involve first generation Malaysian artists like Datuk Ibrahim Hussein , Latiff Mohidin, Datuk Syed Ahmad Syed Jamal and water-colourist Yong Mun Sen.
Another prominent example is Chen Wen Hsi, one of Singapore’s pioneer artists known for his avant-garde Chinese paintings. There are claims that 80% of Chen’s art in the market are fake and have been submitted for auction at well-known auction houses.
One art gallery owner says art forgery or imitation usually involves high value work by Yusof Ghani and Tew Nai Tong that are worth a few hundred thousand ringgit. The victims are often investors with little knowledge of art.
Tay points out that the company makes every effort to ensure the art pieces it puts up for auction are genuine. “Some auction houses do not do that; they only want to focus on the profits. I would advise collectors to learn how to differentiate between a genuine and imitation work, it’s only by looking at more genuine pieces that you can tell them apart”, he says.
When the company receives a consignment from a collector, it consults its panel of advisors, firstly, on whether an artwork is suitable for auction, and secondly, whether it is authentic before deciding to put it up for auction. ” We have come across cases where our panel felt that a particular piece of undocumented artwork looked dubious or questionable in terms of authenticity.
” If any member of the panel raises any concern about the authenticity of any artwork, we would simply not include it in the auction so as not to risk our reputation. All it takes is just one dubious artwork for clients to lose faith in you”, he says, adding that the company encounters fewer than 100 cases of dubious or questionable artworks per year.
Compared to Indonesia, forgery of Malaysian art is still in its infancy. “Most of our pioneer artists were abstract artists ; it’s not easy to imitate or produce fake works of abstract art, with the layers, textures and colours to consider. For instance, it would be incredibly difficult to imitate an art piece by Latiff Mohidin. That could be a contributing factor as to why we do not have as many fakes as Indonesian art”, Tan says.
He cites the controversial case of Dr Oei Hing Djien, who arguably owns one of the largest collections of Indonesian modern and contemporary art which is showcased in a private museum called OHD Museum in Magelang, Indonesia. There’s currently a heated debate on whether the majority of these works are fakes as no one knows where the paintings came from.
According to Tay, every artist has experts who can help authenticate artworks. For instance, if a collector wanted to authenticate artwork by Indonesian artist Affandi, he could go to the Affandi Museum. A collector who wants to authenticate a painting by Arie Smit can do so with the Neka Art Museum in Bali.
” Unfortunately, Malaysia has no such institutions or museums that are dedicated to particular artist. If one wanted to authenticate a piece of art by a Malaysian artist who has passed away, the only thing the person can do is to consult his assistants or family members.
” Sadly, there are very few art experts as the local art industry is relatively young. We do need people who have knowledge in this area because we want to educate the public to buy genuine artwork and not imitations “, Tay says, adding that he looks forward to the day when a museum dedicated to Latiff Mohidin can be established.
Shooshie’s take on the Malaysian art scene
MALAYSIAN artist and curator Shooshie Sulaiman is the first Malaysian to be engaged by Tomio Koyama Gallery, one of Japan’s most powerful contemporary galleries which represents major Japanese artists like Murakami Takashi and Nara Yoshitomo.
Born Susyilawati Sulaiman, this artist believes the Malaysian art scene is rather skewed towards commercial value, with very few appreciating critical value in a piece of art. ” I think that’s because of the way of life here. In school, we focus on getting good results, but we don’t take the time and effort to understand the knowledge we’re learning. It’s the same for every aspect of life here ” she says.
However, she doesn’t blame the public for that. Instead, she blames local art institutions. “Art is about knowledge, and it is their responsibility to disseminate this knowledge, but our art academicians do not produce any books that will help the public understand art. It’s our job to explain to the public, so you can’t keep blaming them for being ignorant”, she says.
Shooshie points out that the societies in first world countries have high regard for artists because of the knowledge they have. Unfortunately, that’s not the case here. According to her, many local art graduates fall for the temptation to produce artworks that are either commercially viable or make them commercially successful. Such artworks however, often lack depth.
” There’s nothing wrong with that. However, that is what we need to avoid if we want to create a first world country and for Malaysians to rise to become an intelligent society. Japan is a perfect example; how is it that they can enjoy a zero crime rate, a clean country and cultured people who are, at the same time, so rooted in their own identity?
” Why can’t we achieve the same? Naysayers may claim that is it impossible because we are a multiracial society and we have difficulty understanding each other. But I think the real reason is because, right from the start, we are confused about our own identity. What hope do we have for Malaysian art if we continue to harbour such mentality?”.
With a greater appreciation and rising demand for art in Malaysia, Shooshie points out that many gallery owners face the problem of sourcing for good art today. And one of the reasons for this is because young artists are not being provided with the right guidance. “It was so different back when I started out. We’d spend a lot of time planning, researching and giving thought to our work at every stage. Young artists today are so impatient, they want everything fast. But then again, they are living in a world where everything moves very fast. What makes it worse is the younger generation of artists seem to love courting controversy as a way of popularising themselves. It’s as if life is entertainment for them “, she says.
Not surprisingly, since she has established her reputation as an international artist, Shooshie has been approached by many young artists who want to follow in her footsteps. “Some people declare themselves as international in a neighbouring country. That’s not good enough. If they were to exhibit at international art events, they’d be stuck -unable to explain their work the minute the curator starts to quiz them about their artwork. You may become a commercially successful artist, but you can’t compare yourself with an international artist who contributes to knowledge. Your artwork must reflect a sense of maturity for that to happen”, she says.
Article was published in The Heat Newsweekly Paper (Issue 21)