View of the 17th edition of SP-Arte, in the ARCA shed. Photo: Disclosure

By Julia Garcia e Marcos Grinspum Ferraz

Horizontal, color photo. View of the 17th edition of SP-Arte, in the ARCA shed. People circulate through the stands and corridors. Art market 2021.
View of the 17th edition of SP-Arte, in the ARCA shed. Photo: Disclosure

En 2020, after almost a year since the beginning of the Covid-19 pandemic, the arte!brasileiros spoke with a number of gallerists, auctioneers and market experts to make a balance of how the period had been for the sector, notably in Brazil. The finding, surprising at the time, was that after an initial shock with the enactment of the quarantine, the recovery of business was rapid and consistent, in contrast even to other regions of the globe such as Europe and North America. At the end of 2021, after another year of a pandemic, we again interviewed a number of professionals in the area to learn about the results of a period that, despite the restrictions, also involved a series of flexibilities. The conclusion, practically unanimous among the approximately 15 interviewees, is that the year was even better than the previous one, even in the midst of a scenario – sanitary, political, economic and social – so troubled in the country.  

“The year 2021 was much better than 2020 and better compared to the year before the pandemic”, he says. Luisa Strina, one of the most important gallery owners in the country. Auctioneer Aloísio Cravo, who had a more oscillating performance at the beginning of the quarantine, follows the same line: “The 2021 auctions had revenues comparable to those of 2014 or 2015, before we entered a very bad sequence with all the political and economic instabilities in the country. parents". With the particularities that involve each house, the statements of the gallery owners always follow in a similar direction. Vilma Eid, from Station Gallery, says that two of the exhibitions held at the house had all the works sold in the first days of exhibition. André Millan (Millan Gallery), in turn, summarizes: “Incredibly, at least here in Brazil, these times of pandemic surprised everyone and, in general, sales were very good, the art market reacted surprisingly well”.

Some of the reasons for this result, found in the first year of the pandemic, sounded unexpected: the longer time spent indoors and the decrease in other types of expenses, such as travel and restaurants, encouraged people to buy more works of art for their families. private environments; the migration of businesses to the virtual environment brought together a portion of younger buyers, less accustomed to the environments of galleries and fairs and quite inserted in the online world; in addition, the creation of partnership projects between galleries, previously rare, and experimentation with new sales formats have brought results. This is all considering, of course, that “the elite are the ones who buy art and are the ones who suffered the least from the pandemic”, as the evaluator and art market consultant Tamara Perlman highlighted at the end of 2020.  

What we saw, therefore, was even the opening of new galleries – HOA, Projeto Vênus and Index last year; Marli Matsumoto, 132 Art and Bailune Biancheri this year, among others – and branches of houses already established as Jacqueline Martins, DAN Gallery and The Gentle Carioca. But if they were two positive years, there are also notable differences between the performance of homes and the behavior of buyers in the two periods.

The role of online and the (de)acceleration of face-to-face

If in 2020 the online became the center of negotiations, doubling the number of sales executed there - as shown by the Art Basel and UBS annual report -, with the start of vaccination and the reduction in the number of new cases of Covid-19 in Brazil and in the world, 2021 had part of this scenario changed. On-site activities were gradually resumed throughout the year, galleries and museums reopened their exhibitions and national and international art fairs adopted a hybrid format. 

In the case of auctions, “online is established as a solid operating alternative”, as guaranteed by Aloísio Cravo. The auctioneer points out that his two events this year took place virtually and had good results, even doubling the value of the pieces. There is also a profusion of small auctions through virtual channels, with lower price levels, as stated by Tamara Perlman. 

Galeria Nara Roesler's booth at The Armory Show 2021. Photo Charles Roussel

However, this does not seem to be the general picture for the arts. The hybrid model establishes itself as a path of no return, the online one does not seem willing to retreat, but perhaps it does not persist in the way that was expected. “I think that, this year, the virtual was more a process of approximation, less of a sale. It has not lost its importance, but the sale has become more face-to-face,” he says. Murilo Castro, from Belo Horizonte. Vilma Eid and Alexandre Roesler, partner at Nara Roesler Gallery, chorus and highlight the viewing rooms as a complement, more than a business front. The director of ArtRio, Brenda Valansi, was able to verify this in this year's edition of the carioca fair: “The virtual platform ends up being widely used as research, for those who later want to see it in person, or sometimes the person sees it physically and finalizes the purchase in the online”. for the founder of Gomide & Co. (formerly Bergamin & Gomide), Thiago Gomide, the comparison between the results of face-to-face and virtual events is unfair: “I think viewing rooms are here to stay, but the comparison is ridiculous. The sales that were the result of something online were derisory in my earnings”. 

Although digital programming does not have the same power as physics, as Roesler points out, it is much cheaper. This seems to be one of the key factors for the success of 2020. If, on the one hand, sales were lower, it was the ability to reduce operating costs that allowed some gallery owners to maintain profitability. The return of face-to-face services has an impact in this regard, especially with the rise in the dollar and euro exchange rates. “Participating in a physical fair, for example, is very expensive. It is currently even more expensive, because logistics costs have more than doubled”, highlights Roesler. 

In the years before the pandemic, fairs were responsible for almost 50% of sales by gallerists around the world, according to the report by Art Basel and UBS. In 2020, that number dropped to 13% as a result of canceled events. Several gallery owners in Brazil and around the world point out that this decrease in dependence on fairs may be here to stay. According to a report by The Art Newspaper, in 2019 alone, 178 art fairs took place alongside biennials or triennials and museum and gallery exhibitions. “It's a predatory system. There is no house that can finance all this investment”, shares André Millan. “When you stop for a while, realize that you didn't have any fairs [in 2020] and continued to sell well, then you ask yourself: do I really need to do all this?”, asks Roesler.

For Thiago Gomide and Thais Darzé (Paulo Darzé Gallery), the pause resulting from the pandemic allowed gallery owners – usually immersed in intense event routines – to think about how much the operational cost and the process of stress, fatigue and expectation revert financially and institutionally. The Brazilian result seems to match foreign forecasts, which point to a decrease in travel and participation in fairs by galleries. Márcio Botner, partner ofThe Gentle Carioca, on the other hand, believes that the trend is a resumption very close to what existed before. “Of course, it gives a feeling that maybe it's not possible to be that fast, that maybe it would be better in some other way, but I still find face-to-face contact essential”, says the carioca. Despite the disagreements, the opinion is not totally out of line with the attitude of the other gallery owners, who argue that even with the decrease in dependence on fairs, it is not possible to completely detach, either because of the bonding and socialization possibilities created, or the results in long-term sales. or by expanding into other markets. 

Cassia Bomeny Galeria stand at ArtRio. Photo: Disclosure

The results of the two largest national events in 2021 demonstrate, in fact, that interest in fairs remains high. During the five days of the event, SP-Arte – which this year changed the Bienal Pavilion (25 thousand m2) through the ARCA shed (9 thousand m2) – received about 18.500 people, selling out practically all available tickets, and had 40 thousand hits in its virtual version. For Gomide & Co., the fair presented one of the best results of the year. THE Verve Gallery sold 95% of the first exhibited collection and the Vilaseca doors sold all selected works even before the end of the event. ArtRio, in turn, had 14.500 people in the physical version and, shortly after the edition, announced its expansion into a new venture: ArtSampa, a fair in São Paulo with a date already set for March 2022.

However, it should be noted that both fairs – as well as the international ones – took place more locally, with fewer exhibitors and foreign visitors, due to the difficulties of transit between countries caused by the pandemic. Other changes in the public were also noticed, not only at fairs, but in the art scene as a whole.

Between activism and financialization

Even though it has been a noticeable movement over the last few years, the pandemic period has seen the intensified entry of new buyers into the art market, especially young people, some willing to take a more “activist” stance, others interested in doing business. This movement, verified globally, includes especially the so-called Millenials – a generation that is now between 20 and 40 years old -, as the research by Art Basel and UBS shows: “The shift to digital has brought improvements in price transparency, access to information and to artists. Reducing barriers to market entry allows for the development of a broader base of new collectors at different price levels,” the report says.

At least part of the Brazilian gallery owners noticed this movement in their daily lives. “There was a growth of buyers from 35 to 45 years old. It was not just traditional collectors that fed the art market in this period, but new ones. Or maybe people who are not yet collectors, but new buyers with the potential to become collectors”, says gallery owner Murilo Castro. Gomide and Strina, who work with works in higher price ranges, also noticed the change, as much as they emphasize that the maintenance of old buyers is essential.

“It's a consistent audience that already has a lot of information”, says Cravo, who has been in the market for 40 years. “Until the 1990s, I feel that we needed to inform the new client much more, who came willingly, but very raw. Today you observe the young person who has already researched, who knows what he likes, who already comes with material to start the dialogue. I think this also has a lot to do with the internet, with this huge access to information”. According to Perlman, it also has to do with the expansion of a network of qualified professionals aimed at supporting this market, from the so-called art advisors and evaluators to catalogers and restorers, among others. “In other words, an entire service infrastructure that facilitates market growth,” he explains. 

According to Brenda Valansi, the impact of this younger generation was felt at ArtRio 2021, and is also related to a more engaged production in the country: “What I perceive that happens in the market, as a result of the political and social context, is a change in the choice of artists and the subjects dealt with, which accompany the discussions that are taking place in society. Along with this, there is a strengthening of an activist collecting, a collector's concern to be more socially active, and this happens very strongly with the new generations. So the market also needs to be attentive and offer other paths”. On a global scale, the international focus on Latin American art produced by minority groups – blacks, indigenous peoples, women or the LGBTQIA+ population – also favors the Brazilian market. An example – in a higher price range – is the sale made by Gomide & Co. for the Abu Dhabi Guggenheim, in 2020, of a work by Lygia Clark for around R$10 million; or the recent transaction, at Sotheby's New York auction, of a self-portrait by Mexican Frida Kahlo for almost R$200 million – a record value for a work by a Latin American artist.

Self-portrait “Diego y yo”, by Frida Kahlo, auctioned by Sotheby's, in November 2021, for almost BRL 200 million – a record amount for a work by a Latin American artist. Photo: Angela Weiss/AFP via Getty Images

But there is still an increasingly significant portion of buyers, as shown by national and international surveys, who are little – or at all – concerned with the content of the works, but only with art as a financial investment. Perlman, when analyzing data released this year by the consultancy Deloitte, explains that there is a growing group of younger buyers, “connected with everything digital, including digital art”, who enter the market to do business, that is, to buy and sell works with relative speed, not collect them. In this sense, types of operations are increasingly emerging in which the buyer does not even own the work, but only a fraction of the work, like someone who buys shares on the Stock Exchange.

Inequality that does not affect the market

For Thais Darzé, this relationship of art as an investment is perhaps one of the reasons that lead the years of the pandemic to good sales results. “A work of art is a material investment, many people in times of crisis choose to do this type of transaction”, she says. With a diverse collection, Paulo Darzé Galeria presents works by emerging young artists, as well as established names such as Amilcar de Castro, Frans Krajcberg, Leda Catunda and Tunga. The two sides of the business had very different results in 2021. “We have a heated art market for more expensive works, because the crisis has less of an impact on the great fortunes of the country. From the point of view of young artists, the business is quite precarious. They are more affordable works by emerging artists and the sales impact is very significant.” 

The crisis imposed on the country, including in the cultural area – with the paralysis of the Culture Incentive Law, the lack of investment in public institutions and even the restriction of artistic creation – does not significantly affect the market. “I think we have a dismantling happening, a very complex moment in relation to the public resources of culture, but in fact the market in Brazil is very dependent on private collectors, and these collectors continue to capitalize, they continue to make money circulate in some way, so does not have a direct impact on the market”, says Bruna Bailune, from the young Aura Gallery e Bailune Biancheri. The findings are in line with the current context. As the report on global wealth made by the bank points out Credit Suisse, the concentration of income increased worldwide in the period of the pandemic. In Brazil, we are experiencing the worst level of income concentration since 2000, with 49,6% of the country's wealth in the hands of 1% of the population. “I think there's a lot of money in the art market. Every day new collectors and new patrons enter. I feel that we are at the beginning of a great tree, that the next decade will be the best the art market has ever had”, says Thiago Gomide. 

The gallery owner's forecast does not seem far from what the research shows. “The report of Deloitte shows that the number of the super rich in the world has grown a lot in recent years, and that this has not yet resulted in a proportional increase in the numbers of art sales, which means that this market still has a lot to grow”, points out Perlman. According to the survey, by 2025, we should see a great growth in investment in the arts not only in Brazil, but all over the world.

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