Driven by demand, the overseas market for Chinese art reached a historic high in 2015, totalling US$2.6 billion in sales and reaching a size more than half that of mainland China for the first time. The average sale price increased by 8% year-on-year to $54,265.
Based in Hong Kong with offices in London, New York, Singapore and Malaysia, Art Futures Group (AFG), with over two decades of expertise brokering contemporary and classical art, became the first company in Asia to provide art investors opportunities to profit and monetise their collections by introducing guidance on art investment.
Macey & Sons Auctioneers & Valuers Ltd Acquires Art Futures Group in Cash Deal
Before Art Futures Group, art investments typically required a minimum of US$2 million to a specialist division of a bank like HSBC, where a financial advisor would then be assigned to you. AFG served the mid-range market invest in artworks with as little as US$30,000.
Close to 8 years on, the initial premise of the Group became the subject of investigative journalism from mainstream financial news media Bloomberg regarding allegations from investors regarding million dollar losses on overpriced Chinese art. The hook was simple – Buy contemporary Chinese art through AFG and then lease it to a corporation for a guaranteed 6% annual return. When some investors still saw their works still exhibited in galleries rather than leased out, their initial concerns were allayed as the dividend cheques kept coming. Until finally, it stopped and the leasing contracts allowed to lapse. Though Bloomberg retracted the story two months after initial publication, internet forums, armchair commentators, and even a submission to complaintsboard continued to fan unproven accusations of financial misconduct.
“This is a transformational deal for both of these businesses, at an immensely important time in the art market in Hong Kong and in Asia. AFG has a proven business and second to none back office systems, but the business as a whole and the opportunity in the market is really what attracts us.” – Jonathan Macey, Macey & Sons’ Chairman and founder
Yesterday, 21 August 2019, the reputable Macey & Sons Auctioneers & Valuers acquired Hong Kong-based Art Futures Group in an all-cash deal for an undisclosed fee. According to a statement issued by Macey & Sons, AFG’s business operations and staff will be completely incorporated, allowing the Auctioneers to offer the expanded range of their inventory to AFG’s existing customers.
The acquisition of Art Futures, one of the bigger brokerages specialising in Asian contemporary art will create one of the largest Hong Kong-based art dealers, creating a springboard for the newly expanded Macey & Sons during a crucial time for the art market in Hong Kong.
Art Futures Group will continue to operate with its own brand while the staff and operations team will remain status quo for the short term. Furthermore, Macey & Sons will also continue to develop its online sales platform to give clients new means of liquidating investments, additionally hiring experienced Hong Kong art advisor Benjamin Sigg, as part of a strategy to develop both businesses’ portfolios.
According to UBS 2019 Art Market Report, the sector has grown steadily in Greater China over the past few years, up from US$5 billion in 2008 to US$12.9 billion in 2018, mirroring growth throughout the region. Dealer sales have also been increasing, expanding 7% year on year in 2018.