If you have clients who want to start investing in art or expand their collections into areas where they lack expertise, working with them to hire an art advisor or consultant could be a good move.
Cheryl Perkey, owner of Perkey Fine Art Advisor in Los Angeles, Calif. and Constanze Kubern, managing director of Constanze Kubern Art Advisory in London, England, recently shared their insights into working with art advisors with AdvisorOne.
What services does an art consultant typically provide private collectors who are buying or selling artworks?
Cheryl Perkey: When buying art, the art advisor uses their experience and art world connections to give the private collector insider access to the most desirable artworks. Also, the art advisor builds financial value for the collector by sourcing and negotiating the best prices. Furthermore, the art advisor can research the market value, condition, provenance and authenticity of the art before buying, so the collector gains peace of mind and avoids costly errors.
The art advisor also can take care of custom framing, installation of the art and insurance valuation, and give guidance on any needed restoration and the proper care of the art. The collector gains additional benefits by working with their art advisor to identify their collection focus and develop an overall collecting strategy. When selling art, the art advisor can determine the current market value of the art, recommend the best method of selling, find a buyer and handle all of the transaction details.
Constanze Kubern: Art advisors typically advise private clients on collection composition and its management. Services range from identifying potential works to facilitating the acquisition process and taking on transport, import, insurance related matters among other.
In a market as opaque as the art world one needs to navigate very carefully and a good understanding of its inner workings is essential. By hiring an art advisor clients may not only gain access to unique buying or selling opportunities; preferential fee arrangements with third parties can result in great savings for the client.
What qualifications should a collector seek in an art consultant?
Kubern: Besides the required expertise within the art collecting category an art advisor should bring a thorough track record and an extensive network of key players to the table. There are no industry specific qualifications or accreditations required yet.
Perkey: Collectors should look for an art advisor who has been active in the business for many years, optimally at least ten years. Experience really counts. It takes years to develop the resources and art world connections that top art advisors use to access the most desirable artworks and get the best prices, such as knowing the right dealers, building direct relationships with artists, and knowing where to find rare artworks.
Your art advisor can, and should, be like a backstage pass to best of the art world. Similarly, only through years of experience does an art advisor gain the knowledge and finesse necessary to guide clients regarding the investment potential of their art collection, or to serve in an educational capacity that can enhance the client’s own art connoisseurship and their enjoyment of their art collection.
Is there a dollar minimum that a collector should have in mind for acquisitions or sales before considering working with a consultant?
Perkey: Most art consultants work with both seasoned and beginning art collectors with varying budgets starting perhaps at a few thousand dollars.
Kubern: No. Clients may benefit from the expertise and services provided by an art consultant at every price segment. Pure art investment which aims to maximize an investment portfolio´s performance requires a higher entry level, (so) a minimum of $200,000 is advisable.
How do you get paid for your services: hourly, retainer, project fee, percentage of transactions from the galleries you work with, etc.?
Kubern: That depends on the services provided. Either a monthly retainer or compensation following a fixed percentage fee structure, which ranges between 2 to 10%, is applicable. Constanze Kubern Art Advisory is an independent consultancy which acts on behalf of the collector not the art dealer or gallery. A transparent fee structure is provided to the client at all times.
Perkey: Usually when buying or selling art for a client, the client compensates Perkey Fine Art Advisor with a commission for the services, which is a percentage of the price of the art. We do not take any fee or commission from the gallery or artist because it is important to maintain complete objectivity in the interest of the fiduciary duty we have with our client. Certain services such as valuation or an ongoing project may be compensated with an hourly fee.